The micro- and macroeconomics of the UK housing market

In this article, Dean Garratt and Caroline Elliott demonstrate how both microeconomics and macroeconomics provide insight into the challenges facing the UK housing market. By the end of the article you should be able to see the links between the microeconomic and macroeconomic analyses and how each informs the other.

demand and supply, the interaction of markets, methods of government intervention, housing market, monetary policy

The UK housing market is great to analyse from an economics perspective as many economics concepts can be used to provide us with insight into how this complicated sector operates. What is especially interesting about housing markets is that they offer an opportunity for us to use both microeconomic and macroeconomic concepts to understand the market. It is more common to find microeconomic and macroeconomic concepts used in separate analyses.