Factors Affecting Demand In Economics

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Introduction

Demand is a very important law for becoming a successful business because we need to know what determinants effects customers to buy a particular good, then we can choose the right way to sell it .

Body

The relationship between demand and price is simple: when the price of good rises, the quality demanded will fall. Similarly, when the price of good falls, the quantity demanded will rise. To explain this more we need to know that there are two reasons for this law: Firstly, the purchasing power which leads to the income effect concept. Secondly, having related goods leads us to the substitution effect.
So based on that, we have several factors that affect demand in Oman:
1- Price - If the price of houses increases then …show more content…
If the supply of rented accommodation is less, then there is an increase in the price of rented apartments. Therefore, in the long run people find that it is cheaper to buy houses than to live in a rented accommodation. Hence, then they will tend to purchase a house. Thereby, increasing the net demand for houses.”

The factors that affect supply are:
1- Price
2- Cost- for example The alternative to buying a house is renting. If the cost of renting to buying rises, we would expect to see a fall in demand.
3- Size of market, the more options you have the cheaper prices you get.
4- Price of related good
5- Technology- this factor isn’t playing a major role in the process as in country we intensive labour with intensive capital.
6- Consumer expectations, I mean here that people normally wouldn’t by buy when house prices are going to decrease knowing that they will buy it later …show more content…
There have been great developments in the sector and many investors are earning good money from their investments. Market, demand and supply are key issues that have impacted the growth of the real estate sector. These factors have helped determine the pattern of allocation of interests and resources in land utilization. In addition, these factors have impacted demand and supply shape and elaborate how technology demand and prices substitute as a change in price of resources.”
Based on that, we need to analyse the rent-control-policy in country.
First, there is a freedom in market entry and exit, this helps with having variety of housing supplies. When the size of market is bigger, the more choices we have.
On the other hand, having rent-control-policy distort market mechanism but it is important to organize and protect both the landlord and the tenant rights and duties.
Government rules and legislation are existed to impact the supply and demand of housing in a number of ways. For example the regulations of planning approval of new house building may discourage investors/buyers. On the other hand some better housing policies will encourage building business and related services.
Here I elaborate on few terms in a regular rent contract in Oman:
Article 1
“The second party shall pay to first party a sun of ….. Within fifteen days from the due
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