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Last edited 22 May 2019
The term ‘housing market’ is used to describe the state of all transactions in a particular area concerning the buying and selling of homes, whether private- or public-sector. It will encompass things such as finance, interest rates, confidence, mortgages, and supply and demand.
A major factor influencing the housing market is the level of confidence that exists around the buying and selling of homes. Thus, a depressed market will not only involve fewer house-buying transactions and possibly lower house prices, but also low investor expectations for the short – and possibly medium - term.
 Factors affecting housing market health
When low, mortgages will be cheaper and so more desirable. They will remain cheap if the economy is weak, with no or fewer hikes in interest rates. High interest rates increase the cost of mortgages, deterring some buyers from entering the market.
Like all markets, housing is affected by the interplay between supply and demand. When the supply is high, prices tend to be lower and vice-versa. If not enough homes are built over an extended period, the result could be an acute shortage of homes and a rise in the number of people renting.
 Economic growth
The more take-home pay is spent on a mortgage, the more unaffordable housing becomes. This can be a deterrent to potential buyers. Affordability is a much-discussed subject and potential buyers are acutely aware when homes are unaffordable.
Market confidence may act as a brake on growth. The housing market will likely only pick up when confidence returns.
 Related articles on Designing Buildings Wiki
- Affordable housing.
- British post-war mass housing.
- Domestic building.
- Flat definition.
- Home ownership.
- Housing associations.
- Housing standards review.
- Minimum space standards.
- Residential definition.
- Smart home.
- Terraced houses and the public realm.
- The future of housing.
- The history of fabric structures.
- Types of dwelling.
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