Epping Housing Market Analysis
2. Recent and future trends in Epping housing market
One contributory factor for this high demand could be because of the trend in the current levels of immigration, which is arguably the highest since the 1960s. Immigration should contribute to both sides of the demand and supply sector, however one could argue that current increasing demand is not being met by the slower responding supply sector.
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And there is also growing speculation that interest rates will continue to increase next month.
Due to the increase in interest rates, consumers would be reluctant to pay more in interest when buying houses. Thus demand would probably fall, but the quantity coming from the supply side may initially remain the same in the short term. As a result, the demand curve might shift to the left from D0 to D1, and the supply curve would maintain the same as before. The equilibrium point would fall along the supply curve from e0 to e1 (see Figure 3)
4. Factors influencing supply side of Epping housing market
The supply of housing is always going to be quite sluggish. Due to the raising cost of building materials and land value, builders tend to decrease the number of buildings in order to reduce the immediate building cost. However the demand for buildings would initially remain constant in the short run.
[pic] Above diagram from