State three reasons why prices of land for housing development have fallen in recent years in Ireland:
(i)
(ii)
(iii) - Leaving Cert Economics - Question 1 - 2010
Question 1
State three reasons why prices of land for housing development have fallen in recent years in Ireland:
(i)
(ii)
(iii)
Worked Solution & Example Answer:State three reasons why prices of land for housing development have fallen in recent years in Ireland:
(i)
(ii)
(iii) - Leaving Cert Economics - Question 1 - 2010
Step 1
Deflation
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Answer
The general decrease in prices across Ireland has contributed to a decline in land prices, reflecting the broader economic conditions.
Step 2
Recession and Economic Conditions
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Answer
Unemployment rates and falling incomes during the recession have led to a reduced demand for housing, which in turn lowers land prices.
Step 3
Overcapacity in the Housing Market
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Answer
The current housing market has an excess supply, with more properties being vacant than there are buyers. This overcapacity has diminished the demand for land for new housing developments.
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