How a housing market works

Supply, demand and why prices are sticky

Members

In this lesson

Understand what drives housing supply and demand, and why house prices move more slowly than stock prices.

Key takeaways

• Demand comes from population, jobs, incomes and access to credit.
• Supply comes from existing owners listing and from new construction, which takes years.
• Prices are 'sticky': sales volumes usually turn before prices do.
• Housing is seasonal — compare with the same month last year.

Next lesson: Buyer's market or seller's market?

Educational information only - not financial advice.