With the rising inflation in the economy, the rents are riding in the housing sector as well. This makes it feasible for the people to borrow money to buy a house than to rent and pay extra charges without investing in an asset which can be liquidated later.
Moreover the demand for housing is income elastic as it is a luxury. And the increasing incomes of people inUKare raising the demand for housing in the region as well.
The long term interest rate in the UK economy is predicted to be low for a long period of time. This makes it more attractive for people to borrow and build or buy houses therefore increasing the demand for housing in the region. Moreover these interest rates are likely to remain low due to the technological advancements, globalization and competition in the market. Lastly the increasing number of households in theUKregion, specially triggered by increase in single member households and changing social trend for divorce and separation is also increasing the demand for houses in the region.
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