Rise in House Prices in the UK - Dissertation Example

Download file to see previous pages In response to the constantly rising house prices, other related prices such as rent and mortgage prices have also risen simultaneously over the years (Catty, 2010).
The constantly increasing house prices in the UK have led to widespread concerns regarding its likely impact on the economy in the long run. It is estimated that in response to such a phenomenon, the housing and mortgage market is likely to suffer serious negative consequences. It is estimated by some that the impact of rising housing prices on the economy will result in the country being pushed towards re-experiencing the boom-bust phenomenon of the 1980s and 1990s whereby the sharp rise in housing prices had resulted in a recessionary British economy (Richardson, 2011; Hallett, 1993).

This study on ‘Rising prices in the UK’ aims to explain the UK housing market - including an in-depth/comprehensive overview as well as a detailed explanation of the contemporary market and economy, and seek to understand the factors behind the exorbitant price rise as well as the implications of the same. This essay includes an overview of the recent trends and the factors causing price rises in the UK housing market, as the recent evidence regarding housing and mortgage market behavior in the UK. It also includes relevant case studies to explain the phenomenon and the implications and consequences on the country’s economy.

1.1. Thesis Statement:
The UK housing market has experienced high volatility over the past couple of decades causing a domino effect, significantly affecting renting, availability of housing, poverty, employment, as well as social structures in the process. The study of factors causing such volatility with the help of an extensive literature review and a case study is likely to help in policy recommendations and stabilizing the market in the long run.

1.2. Research Questions:
The following research questions will be addressed and answered through a case study:
 What are the key drivers of housing prices in the UK and how can they be addressed through policy implementation?
 What is the impact of the lack of housing supply on the housing market in the UK?
 How have the housing market and price volatility affected housing reforms?
 In what manner have the current trends in the UK housing market helped or hindered the policy reforms?

1.3. Research Objectives:
 To examine the various factors causing volatility in the housing market
 To understand the implications of such volatility on the economy
 To assess the changing trends in the UK housing market
 To evaluate the impact and influence of the changing trends in housing development projects on the housing market

2. Literature Review
2.1. UK housing market: Comprehensive overview
The housing market in the UK is going through significant structural changes which are likely to result in simultaneous and corresponding structural changes in the long run (Whitehead and Williams, 2011; Williams, 2007; Miles, 2012; Savills, 2011). There is a significant rise in privately owned house ownership as well as private renting which has almost tripled over the past couple of decades. Such rise in ownership as well as renting along with an influx of migrants from all over the globe has resulted in a serious shortage of homes resulting in the rise in privately owned as well as rented houses and ultimately leading to a mortgage crisis and a serious lack of social housing and accommodation. The situation is more serious for low-income and middle-income households. ...Download file to see next pages Read More