Real estate economics has always been an ever-evolving field, with new trends and dynamics shaping the market every year. Recently, Real Estate Economics announced a call for papers for a special issue on sustainability and affordability.
This special issue aims to explore the relationship between real estate markets and sustainable environments, and how race and class intersect with real estate markets for space and assets. The call for papers welcomes submissions addressing various aspects of sustainability and affordability, such as variation in disaster exposure by race and income, discrimination and disparities in urban development, zoning and regulation, gentrification, access to affordable housing and neighborhood quality, green finance and more.
One of the key factors that influence the supply and demand of real estate is the availability of homes on the market. The number of active listings and new homes being built can affect the supply of real estate, as well as the number of permits being issued for new construction. Additionally, land use regulations and zoning laws can also play a role in the supply of real estate, as they can limit or encourage the development of new homes in certain areas.
On the demand side, interest rates, the economy, population growth, consumer confidence, and government policies can all have an impact on the real estate market. When interest rates are low, it makes borrowing money to buy a home more affordable, which can lead to an increase in demand for real estate.
A strong economy also tends to lead to an increase in demand for real estate, as more people are likely to have the financial resources to purchase a home. Population growth, particularly in urban areas, can also lead to an increase in demand for real estate. Consumer confidence is another key factor, as people are more likely to buy a home when they feel financially secure and optimistic about the future. Finally, government policies, such as first-time homebuyer programs, can also affect the demand for real estate.
When demand for real estate is high and supply is low, prices tend to be higher, and vice versa. However, understanding the interplay of these factors can be complex, as they are all interconnected and can affect the real estate market in different ways. For example, a decrease in interest rates may increase demand for real estate, but if there is also an increase in the number of homes available for sale, it may not result in a significant increase in home prices.
Canadian housing market: According to recent predictions, home sales are expected to bottom out in early 2023, making it the weakest sales year since 2001. Additionally, home prices are also expected to bottom out in early 2023, with a peak-to-trough decline of around 20%. However, this forecast could change depending on the Bank of Canada’s interest rate policies.
Experts say that in 2023, the average home price in the Atlantic Region, Ontario, and British Columbia will drop sharply, while the average home price in the Prairies and Newfoundland and Labrador will drop less because they are more affordable.
By 2024, it is forecasted that home sales and prices will return to positive growth. However, it is important to note that the supply picture could change this forecast. For example, if significant amounts of forced selling were to happen due to higher interest rates, it could result in weaker price growth than expected.
The forecast above emphasizes the importance of a thorough understanding of the various factors that drive the supply and demand of real estate, and their impact on home prices. Additionally, it seeks to provide a fresh perspective on the field by underscoring the vital role that race, class, and the environment play in determining sustainability and affordability
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