Need help with my writing homework on Microeconomics and Property Market. Write a 1500 word paper answering; The property market is basically the system by which land and buildings are bought and sold. There is no central institution for this market, which works through an informal network of estate agents and other specialized intermediaries. The property market is extremely imperfect, as every property is different in location, and properties in close proximity differ in several characteristics. These include the type of buildings on them and their condition. access to transport facilities. and amenity aspects, such as proximity to either source of pollution such as rubbish dumps or sources of pleasure such as parks. Also, most individuals move fairly seldom, owing to the high costs of movement, and firms move even more seldom. Thus most buyers and sellers have little recent experience of the market, and most properties are not available to be traded at any point in time. Property prices are thus subject to large fluctuations (Black, 2002). As there are several fluctuations involved in the property market, it is important to use some sort of a system to predict these changes in prices, supply and demand. That’s exactly the point where microeconomics lends a helping hand.
Here, it is worth mentioning that when people speak of the real estate economy, they are using nationally-based statistics. For example, Fortune magazine reported recently that since the early 1960s, average residential real estate values have never had a down year. This statement is true. But while these numbers are measurable, they do not reflect the intricacies of local real estate markets. The stock market is based on the national, even the world economy. The real estate market is based on local, and, in many cases, micro-local economies. Whats happening in Los Angeles does not directly affect whats happening in Toledo (Bronchick). .