Canada Housing Market To Collapse Fall Economy Fall
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Should Government Prevent House Price Crashes?
House prices in the UK have been rising at phenomenal rates. However many economist predict in the future house prices could fall. If this were to occur what would be the economic implications and should the government do anything about it? Arguments for government intervention to prevent house price falls 1. House prices tend to be volatile, this is because Supply and demand are inelastic (if price changes people keep buying them). Also the ho Read More... -
5 Myths of UK housing Market
1. A shortage of supply means prices will never fall. Often people will say because of high demand a shortage of housing in London, prices will always be high and never fall. This is not true. House prices in London may always be higher than elsewhere in the country but there is nothing to stop house prices falling in London. 2. House Prices will keep rising. Perhaps the most dangerous myth of all. Yes there is a shortage of housing in the UK, b Read More... -
Interest Rates and Housing Market
Interest rates are the effective cost of borrowing money. In the UK, the base rate (repo rate) is set by the Bank of England, Monetary Policy Committee. In the US, interest rates are set by the federal reserve. Central Banks usually set interest rates in order to try an meet an inflation target. In the UK this inflation target is CPI = 2% + / - 1. Basically this means that if inflation is forecast to rise above the target the Bank will raise int Read More...
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