Lands

(1) Movement in Populations

An increase in population may put greater demand on landed property for both occupations and investments. Land is not only a necessity for providing shelter, land is also the fundamental platform of all human activities. More the people pour in an area more the land needed to accommodate the various activates. The per capita allocation of space for various needs reduces in an urban area with the growth in population. This is very prominent as supply of land is fixed. As a result the gap between demand and supply widens and price rises.

(2) Economic Activity

With a rise in economic activity such as industrial growth land needs for other purpose such as commercial centers, roads, house, hospitals, aerodromes and the like grow. So demand for land for these services and faculties increase steadily. With economic prosperity general income of people rises and demands for individual facility etc. Also increase. So economic activity pushes up demand for landed property in every sphere.

(3) Improved Accessibility

With opening up of new communication facility and transport routes more outlying districts gain advantage of accessibility to urban service center. This gives rise to a demand for residential land use in the outlying areas and a demand for trade, commerce and service centers in the central areas.

(4) Inflation

The demand for investment in landed property may rise due to inflation, as land is not only a factor of production but also can be advantageously utilized as a store of wealth. Any purchase of real property is an investment. Capital conscious investors prefer landed property as their channel for investment. This is particularly so as landed property shows a steady and certain rate of appreciation in value and certain rate of appreciation in value and is indestructible in character. For this reason land is regarded as an ideal medium for maintaining real value of money in inflationary times. With inflation occurring in an economy there is a strong demand for investment in an amongst the business communities.

(5) Change in taste and social circumstances

A Change in social circumstances may trigger new set of demand s for a particular type of landed property. For example, increased trends for independent small family units in urban areas have given rise to large scale developments of small flat and flat-lets for upper middle class society.

Factors affecting supply of landed property

The factor affecting demand of landed property that in turn go to influence its value,  we shall now examine the supply side.

The following aspects are to be noted on the supply side.

  • In the short supply of property cannot be increased.
  • In the long run there is a limited upto which property supply could be augmented.
  • Once property has been constructed and demands suddenly recedes away then supply cannot be reduced Property is a durable capital asset and is a durable capital asst and is consumed slowly over time.
  • Supply of landed property is dependent upon availability of finance for property development.
  • Due to unfavorable legislation property development may be unattractive to investors.
Land

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