英语论文网

income ratio. It was a risky factor for observance for both banks and the consumers, but people were optimistic about the housing markets during that tenure of time.

2.4. Availability of Finance for Mortgage:

While in the years 1950's, 1960's, and 1970's, it was found that there was rigorous restrictions imposed on the availability of money or finance for mortgages. However, due to the fact that there was a deregulation of both the finance and the banking sector which aggravated the fierce competition led to the rise in the number of products offered by the banks, financial institutions, and building societies for mortgages. There were many products available in the market such as mortgage interest-only, self-certification mortgages, and mortgages up to 6 times income were more prevalent thereby enhancing the demand for housing. However, due to the recent recession of 2008, most of the financial products or mortgage products which were on offer fell drastically leading to shortage of money in the market.

2.5. Demographic factors:

It was found to be a very constant rise in number of households in United Kingdom. The current population is less than the number of households and if there is an average calculated in each instance, it would result that more single people are living alone on their own, so this factor resembles many other reasons which could impact both the households and the family members. Some of the reasons are more people coming in as immigrants from eastern European countries.

The second reason is most likely to be the number of people getting divorced thereby increasing the number of households with single person living alone.

2.6. Speculation:

There is an increasing rate of mortgage products to suit different group of individuals depending on their preferences and income levels. In today's economy not every individual has the will and potential to buy the houses. The individuals who invest in the house property try to make the profit by renting the property. They usually invest when the rates or prices of the property increases and sells the property when the market is about to take a turn. But buying a property involves the costs like estate agents fee, stamp duty, registration fees etc.

Prices of rented property: In the past few years the prices of renting the houses has increased rapidly which has in turn increased the demand for the individuals to but the property and rent them which is a reserve to gain profits. Individuals buy houses or mortgage them and later they rent the property.

2.7. Inherited Wealth:

Most of the households would buy houses with the wealth which has been inherited by them. This also would explain as to why there is a rise in the ratio of house prices to income levels. Nowadays, it is quite a common practice for most of the parents to lend some deposits for their children when they are buying new properties or houses for the first time.

2.8. Unemployment:

People are earning enough to invest in property as buying a property is a mode of saving where in they have the option of renting or selling if needed

2.9. Supply side factors:

Looking from a short run perspective supply of housing is most probably is assumed as fixed, because it takes a while to build houses. After analyzing it is deeme