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Demand Vs Supply

For those of you that have studied Economics you might remember that price is a function of demand and supply. In other words, the price of something is based on how many people want it (demand) and how much there is of it (supply).

It is very easy for the apartment market to be oversupplied as developers bring on hundreds of apartments at one time and they can’t stop building halfway through the project. In the case of houses, it is possible to build just one house and it is relatively easy to halt supply.

A project home builder generally builds one or two display homes and once contracts are signed, they start building other homes. If they don’t have signed contracts, they won’t build, thus halting supply.

Sourced from Realestate.com.au - click here to read more...