The Property Market

Question 1

State the key non-price factors that drive the property market

Answer 1

1. Interest rates
2. Demographics
3. Government subsidies/policies

Question 2

Elaborate on demograophics (a nonprice factors that drives the propetty market)

Answer 2

Demographics- the statistical data relating to a population and groups within it, this provides insights to charachteristics, preferences etc. Examples:

1. Age and housing needs differ
2. Millenials and first time buyers have student debt

Question 3

Elaborate on interest rates (a nonprice factors that drives the propetty market)

Answer 3

Interest rates play a crucial role in influencing the property market as the impact property prices and overall market dynamics. Some examples would be;

1. Property prices. Low interest drives prices up due to competition in demand and vice versa
2. Morgage affordability. High interest makes borrowing money for housing more expensive

Question 4

Elaborate on government, subsidies and policies (a nonprice factors that drives the propetty market)

Answer 4

Governments policies and legislation is can boost or slow down the demand for property. Some examples of how it does this are;

1. Affordable and access to housing incentives: subsidies to first-time homebuyers to make homeownership more accessible

Question 5

How do the non price factors affect the equilibrium in the property market

Answer 5

1. Demographics affect the demand side
2. Interest rates affect the demand side
3. Government policies/subsidies affect the supply side and demand side.