Influences on Supply and Demand Flashcards
Define real estate supply
Property available for sale/lease that is measured according to property classification: dwelling units (residentials), square feet (commercial/industrial), and acres (agricultural)
What is real estate supply influenced by?
Influenced by costs (labor), availability of financing, investment returns, and government and community regulations and planning
Define real estate demand
Property buyers and tenants wish to acquire that is measured in households (residential), square feet (commercial/industrial), and acres (agricultural)
Supply and demand are influenced by: Residential:
Quality of life/neighborhood, amenities, price/facility convenience
Supply and demand are influenced by: Retail:
Trade area, sales, competition, site access, visibility, growth patterns
Supply and demand are influenced by: Office:
Efficiency, costs of occupancy, functionality
Supply and demand are influenced by: Industrial:
Functionality, labor pool availability, regulatory compliance, supplies, distribution channels
What determines overall demand?
Base employment, total employment, and population
Define base employment
The number of persons employed in the businesses that represent the economic foundation of the area
Define total employment
Includes base, secondary, and support industries. Total employment creates a demand for a labor force
What happens in employment and population increase?
Demand and prices increase
What happens if employment and population decrease?
Demand and prices decrease
What are indicators of supply-demand?
Price, vacancy, and absorption
Define vacancy
Existing, unoccupied supply
Define absorption
The “filling up” of vacancy
