factors resulting in the downward trend in the pricing

Abstract

Over the past five years, there has been a significant drop in the prices of the real estate properties in London. In this case, the prices of houses in the city have continues to drop, and even when an increase in pricing is projected, the growth is not determined. Various factors have been attributed to the drop in real estate pricing. The main factors that are thought to result in the decline in the pricing of Houses, land and similar property in London include the subject of Brexit.   Following the increased drop in the pricing of real estate, the study engages in elaborate qualitative research by the use of preexisting data to determine the various reasons behind the fall in the pricing of the real estate.  Through the analysis, the study further comes up with multiple factors s being responsible for the noted drop in the pricing.  The identified factors by the research include.  Among the significant factors resulting in the downward trend in the pricing include the income growth of the population, Supply, demands and regional patterns, Consistency in property type and monetary investments, and low interest rates.  This is in addition to the fact that Brexit is a fundamental force towards the drop in the pricing.

Introduction

The prices of real estate in London have experienced a significant drop over the last five years. The decline is although the city of London presents one of the most significant financial hubs in Europe and the rest of the world. Even with the fall in the prices, the real estate market in London is still undergoing increased losses as there are very view investors in real estate buying the properties in the city of London.  There is a need to understand the various factors that result in a drop in the prices of real estate properties in London.  There is a need to research on the topic to determine the multiple reasons why the prices in the real estate prices have been on the decline over the last five years. Among the reasons include the factors of financial constraints. Through the conduct of the empirical study to detail the perceived reasons for the drop in real estate prices, various groups get to benefit. Among the groups that benefit from the research include the government. Following the determination of the reasons leading to the drop in the house prices, the government can engage in the necessary planning for the city. The other group that benefits from the research includes the real estate developers, especially those who deal with the buying of the real estate house. The final groups of people who benefit from the study include those in need of the buying of the real estate property.

There are various aims and objectives associated with the research. The main goals of the study are to determine the multiple reasons that lead to the fall in real estate prices. Through the determination of the costs of real estate in London, the research could be essential in the resolution of the correct ways to ensure that the pricing of real estate in London.  The research seeks to respond to the research questions including

1. To what extent has Brexit influenced real estate prices in London?
2. Other than the Brexit, do other factors affect the real estate prices in London?
3. Are the prices of the real estate in London in coherence with the costs of other sectors in the country?

Following the answering of the research questions, the research would then be used towards the determination of the various ways and the multiple reasons that affect the process of the real estate houses in London. The research questions are essential in the achievement of the objective of the research. The essence of the study questioned includes guiding the research to ensure that the intended purpose is achieved. The success of the research study will be based on the ability to effectively answer the research questions and provide the correct responses to the queries. The first research question attempts to determine the factors associated with Brexit that cause the reduction 0of the real estate prices in London.  The second question acknowledges that the aspect of Brexit is essential to the decrease in real estate prices in London. Through the research question, the research seeks to determine other possible factors that affect the prices of real estate in London.   The third research question fulfills the aim of the study through the comparison of the costs of the real estate business in London with other companies. The research aims to determine if there are social factors that lead to the nature of the real estate pricing in London or if the pricing experienced in the sector is similar to other industries.

Research findings

The research findings suggest that various factors affect the pricing of real estate in London.  Among the factors that affect the real estate prices in London include elements such as the ripple factor. This suggests that in the case of an economic boom, the cost of the property, including real estate, increases. Similarly, in the case that thee there is either downwards move or stagnation in the economy, then the price of real estate also takes a downwards trend.  Following the fact that there has been a stagnation in the economic aspect of the country, the resulting factor is the downwards trend in the proceeds of real estate in London.  The income growth of the population also affects the price of real estate in the country.  The cost of real estate o real estate in the country is affected by twice as the economic income in the country.  In essence, as a result of a one percent increase in the financial profit of the country, the price of the real estate in the country rises by two percent. The drop in the amount of real estate in the country is a result of a decline in economic income.   The prices of real estate in the country drop by twice as the amount of the decrease in the economic growth rate in the country. The factor of supply and demand is also significant in affecting the prices of real estate property in London. Since there is a substantial increase in the amount of the available real estate property in London and a decline in the number of individuals interested in buying the property, there is a drop in the prices of the real estate property.   Following the fact that the regional patterns present a situation where there is less purchase of real estate property in the region, there is a drop in the real estate prices in London as a way of attempting to persuade more individuals to engage in the purchase of the real estate property. A large percentage of individuals are moving out t of the city in comparison to those getting into the city. The prices in real estate depend on the amount of the demand, and the increase in supply is, therefore, essential in facilitating the drop in the costs of the real estate property.  The factor in the consistency in the real estate property in London also affects the real estate prices in London. As there are significant similarities like the property in London, there is also a similarity in the way that the property is priced.   The comparability and consistency in pricing bring about the fact that as the houses are cheaply priced, then all the houses in the city of London are cheaply priced.  The flexibility in pricing is done as a way of ensuring that the real estate property in London remains attractive to the clients.  The aspect of monetary investments and interest rates also significantly affected the amount of real estate pricing in London.  There is the fact that the region over the past years attracts low interest rates for real estate property. The low interest rates in the real estate property are caused by the value, with regards to interests tied to them. As a result of the meager returns that the real estate sector in London has with regards to the interest rates that they attract, there is the fact that the property lowly priced with the intent of attracting investors in the real estate sector.

Discussion

Through this section, there is an elaborate analysis of the research findings following the extensive research on the various factors behind the drop in the price of real estate in London over the last five years. Following the conducted research, there is the fact that there are various aspects that have led to the drop in the prices of real estate property over the last five years. Through the section, there is an illustration of the findings of their significance to the existing literature. Following the conduct of the research that was done through the qualitative research method that involves the use of secondary data, the research ascertained the reason behind the drop in the real estate prices in London.  The extensive research that entailed the analysis of the descriptive data. The authenticity of the research is generated from the data used by the research as it entails pre-analyzed data that have been criticized and approved as being correct.  Through the b research, the study answered the vital answers on the prices of the real estate in London raised by the research question.  With regards to the research question that seeks to determine the extent to which the aspect of Brexit has affected the process of real estate in London, there is the fact that following the Brexit move, a large number of people and investors are moving away from London, and Britain in general. The movement is characterized by the uncertainties of what could follow after the United Kingdom finally leaves the European Union.  Following the fact that a large number of people are leaving London, the demand for housing and real estate is low, leading to the decline in prices as a way of seeking to attract buyers and investors in real estate.

With regards to ascertaining other factors other than the Brexit that affect that aspect of real estate in London, there is the fact that the Brexit is not the only factor that affects the pricing of the real estate properties. Other than the elements of Brexit, other factors affect the reduced pricing of real estate in London. The identified factors that are further responsible for the continuous drop in the real estate pricing in London are of a wide range, affecting the sector in various ways.  Among the significant factors resulting in the downward trend in the pricing include the income growth of the population, Supply, demands and regional patterns, Consistency in property type and monetary investments, and low interest rates.   Through the vivid exploration to determine the various ways through which these factors affect the pricing of real estate, there is the fact that their effects on the low prices of real estate in London as just as significant as the effects caused by other factors of Brexit. The determination of these factors and the various ways through which they affect the pricing of the real estate is significantly essential as they proved effective ways of devaluing with the pricing issue to ensure that the sector is adequately priced.  The determination of the answer to the research question is essential in the deliberate understanding of whether the problem with the pricing in the real estate sector is a factor that is exclusive to the real estate sector or if it also affects other areas.  Understanding the research question and effectively answering it is significantly fundamental in the effective planning of the affairs of the country, specifically London, on which the research mainly focuses.

If the determinant of this research question was that the subject of the drop in the pricing in real estate property was unique to the sector alone, the outcome would be to determine the various ways of ensuring that the pricing of the real estate in London does not face the downwards trend to the extent that the sector completely collapses. However, following the determination that the patterns of the real estate prices are consistent with the pricing of other areas in London, there is the need to employ more vivid economic research to determine the various ways that could be used to rectify the pricing issue.  Following the extensive understanding of the factors affecting the real estate pricing in London and the way all the identified factors affect the real estate prices, it is possible to use the research to determine the various ways through which the pricing factor could be rectified. The study could be used to act as the baseline to provide efficient solutions to the problems resulting in the continuous drop in the real estate prices in London.

Conclusion

The pricing in the real estate sector of London has been on the negative trend over the past five years. Understanding the reason behind the drop in pricing is an essential factor as it could facilitate the prevention of other adverse factors associated with the pricing of the real estate.  Following the study to determine the reasons behind this drop, various factors have been identified as being responsible for the fall experienced in the pricing of houses, lands, and other buildings. The effective use of the qualitative research method was employed to determine the reasons behind the drop in real estate pricing. The purpose of the qualitative method of research is essentially fundamental as it elaborates on the factor through the provision of detailed information on the pricing.

Further, the data used in the pricing entail secondary data obtained from other research articles already in existence. The use of the secondary data is essential In the research exercise as the information is easily accessible from reputable sources, a factor that then facilitates the saving of money and time that could have been used in the research. The limitations of the study include that it uses secondary data. From this, there is the fact that some of the data that it used could have been manipulated to present a specific idea on the research topic. Also, by the fact that the research is limited to the study of London only, there is no possibility of conducting a useful comparison with the adjacent areas to determine the extensive nature of the trend. Among the recommendations for the research include that a similar exercise should be conducted by the use of primary data to determine better results for the study. Also, rather than relying on qualitative research only, it is necessary to incorporate the quantitative approach and use the two methods together to generate better results for the study exercise.