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英国房价上涨的历史-英国essay格式范文
The History Of Rising House Prices
没有一个经济学家不屑于研究平均房价在英国历史上达到顶峰，并且关于市政局租金增加一倍的问题。或说，英国房地产市场是从根本上不稳定。直到1971年英国房地产市场总体通胀水平为10%。自1971年以来，英国并没有通胀波段在10%。它上升到近40%。这主要是因为低成本租金最终取代了私人租用的部门。英国的房地产市场一直不稳定，自1971年以来，主要因为英国房地产市场价格不便宜，因此影响了非常灵敏的市场需求。
The above figure explains an increase precisely the highest increase in the house prices in 1973. It was a drastic increase as house prices reaching peak for the first time. It involves many factors for leading the house price rise. One of the major factors was that UK was facing a downturn in the economy and was in recession. Due to the recession and downturn in the economy the job market is slow and less of consumer spending as well.
None of the economist bothered doing research about the average house price reaching its peak in the history of the UK and about the council rents being doubled. It is said that UK housing market is fundamentally unstable. Until 1971 UK housing market followed the general inflation level of 10%. Since 1971 UK was not on the 10% inflation band. It went up to almost 40%. This was all mainly because the low cost rent was brought to an end by Mr Heath replacing private rented sector. UK housing market has always been unstable since 1971 majorly because of the no cheap alternative to the UK housing market and thus the demand responds to the market very sensitively. (Largest house price rise in 1971 p1-2)
The current crises has somewhat confused the policy of housing market. Also in the figure if compared the UK housing market is more unstable than France or Germany. Germany and France have been more stable likewise during the downturn as well. If compared in the figure above France have been quite stable but Germany has been affected to an extent since 2001, this was probably because UK was the only country to introduce council housing benefit and France and Germany did it with multiple organisations such as, Trade Uniouns, Charities, Churches...etc.
The above diagram is the indication of the house price growth in the UK comparing with the Euro zone and the US. The graph clearly explains that UK had a major rise in the house price supporting to the correction while the severe down turn in the economy. As mentioned the house price inflation should be 10% but UK’s economy was unstable since 1970’s. It made a drastic growth during the time from 1990’s after coming out of the recession till 2007 ending but then it faced a drastic fall in the house prices. There was very little or no scope for the rise in the house price.
It had been one of the major factors of the current economic downturn and recession in the UK.
Policies to overcome Crises
Almost every part of the world is under recession. Many OECD member countries are facing severe recession like United Kingdom as well, due to a series of global shocks, expecting a slow recovery by 2010. House prices have fallen sharply whereas at the other end unemployment has risen unexpectedly. The financial crises have severely impaired the supply of credit. Large rise in the government deficit is providing support to demand but increase in debt to GDP ratios will increase substantially. Due to the rise in government deficit to fulfil the demand, debt to GDP ratio will rise as well providing very little room for additional fiscal stimulus. As a result monetary policy has eased and the policy rate has fallen to close to zero and also the monetary transmission is impaired and financial conditions while improving somewhat remain restrictive. The Bank of England has begun Quantitative easing as a measure to improve the economy and to create a stable financial condition. Although it would not be that transparent and would take time to recover. These measure have somewhat helped to stabilise the financial system. (policies to overcome crises 2009 p 25)
Now let us go back in the past and analyze the growth of the UK before taking it in the recession. As this downturn is partly correction of the past growth from 1992 and the related downturn in the world economy. It follows a long period of continuous and strong economic growth.
GDP growth in the UK up to 2007 was 2.8% per capita outpacing Euro Zone substantially.
Increase in employment from 29 million to 29 million.
Fall in unemployment rate to 5%.
Inflation on an average has been on target after Bank of England gaining independence.
Also the volatility of output and inflation was low on historic norms.
Strong inflow of immigrants.
Further development of an internationally oriented financial sector (OECD 2008a).
Introduction of a solid monetary policy.
Openness to foreign trade and investment.
Mainly and largely a prolonged and relatively large boom in the housing market.
These were quite few of the reasons which needed correction and it gets some credit to let the UK face the severe recession. The project would be mainly targeting on the prolonged and unexpected growth of the housing sector and its fall. However a number of substantial financial imbalances have also built up.
UK economy has seen an unsustainable growth in past few years and this recession is probably the reversal of it. UK GDP has contracted over 4 % since the peak in 2008 and has contracted more. UK has always been on open economy and highly influenced by international trade and investment. This also contributes towards the current recession as it
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