House Price Changing Factors

Description

⦁How demand and supply view determines housing market buyer behaviorsHow can demand and supply determine property market price ? Property price is arrived at by the interaction between house buyers demand and property developers' houses number supply. Property price is dependent upon the house design and environment and facilities characteristics of both these fundamental components of a property market. Any properties demand and supply represent the willingness of house consumers and property developers to engage in properties buyers buying needs or desires. An exchange of a house purchasetakes place when properties buyers and properties sellers can agree upon a agreed property price. This module will look at property price in a competitive market. When imperfect property market competition exists such as with a property developer monopoly or single peoperty selling firm, property price outcomes may not follow the same general rules.Equilibrium Price in property marketWhen a property exchange occurs, the agreed upon price is called an "equilibrium" property price, or a "market clearing" price. This equilibrium property price occurs at the intersection of house demand and house supply as presented are in balance at the moment in property market short time, e.g. one month.Property price determination depends equally on the moment house buyers' living demand and the moment house number supply. It is truly a balance of the two market components. To see why the balance must occur, examine what happens when there is no balance, for example when the moment property market price is below than the past property market price, the property quantity demanded is greater than the property quantity supplied. In such a situation, property consumers would be clamouring for a property that property developers would not be willing to supply; a property shortage would exist. In this event, property consumers would choose to pay a higher price in order to get the property they want, while property developers would be encouraged by a higher price to bring more of the properties onto the property market.The end result is a rise in property price, when the moment has many proprety buyers feel living desire needs. where the property supply and demand are in balance. Similarly, if a property price is above were chosen arbitrarily the property market would be in shortage properties are supplied, too less properties supply are relative to high living desire demand. If that were to happen, properties developers would be willing to take a higher price in order to sell, and property consumers would be induced by higher prices to increase their property purchases desire, because they feel afraid that there will have less properties to be supplied to sell later and their prices will continue to raise in long time. Hence, a property market price is not necessarily a fair price, it is merely an outcome. It does not guarantee total living satisfaction on the part of house buyer and property seller. Typically some assumptions about the behaviour of property buyers and property sellers are made, which add a sense of reason to a property market price. For example, property buyers are expected to be self-living comfortable interested and, although they may not have perfect property living and house price knowledge, at least they will try to look out for their own living interests. Meanwhile, property sellers are considered to be profit maximizers. This assumption limits their willingness to sell to within a price range, high to low, where they can stay in business.Change in Equilibrium Price of property marketWhen either property demand or supply shifts, the property equilibrium price will change. Look at the modules on understanding property number supply for a discussion of why of that property market component may move. So, what factors can influence the property equilibrium price to be raise.

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