Answer to Question #199053 in Macroeconomics for Zalikha

Question

Based on the above article, is the expected increase in the residential property prices caused by demand or supply factor? Explain and ilustrate your answer

Answer 1

The property market is a great example of how supply and demand work in the business world. Property prices tend to rise when there is a high demand for property but a limited supply. Because there is less demand when there is an oversupply of properties available in a market, homeowners may lower their prices.