Activity 6.2 Intergenerational trends in homeownership in
the UK
Allow 15 minutes for this activity.
1 Briefly describe the main trends of homeownership shown in Figure 6.2 for people born in the 1970s and early 1980s.
2 From your own experience or from news accounts, suggest what might be some of the reasons for the different patterns of ownership for people born in different decades
Activity 6.3 Improving rental accommodation
Allow 5 minutes for this activity.
Suggest some ways in which the experience of renters might be improved, and possible drawbacks of the changes you suggest
Activity 6.4 The importance of checking leasehold terms
Allow 30 minutes for this activity.
1 Read the extract from a Guardian article reproduced in Box 6.1 and summarize its main points in no more than 150 words.
2 The article says a typical starting ground rent for a house built by Taylor Wimpey was £295 per annum, which would double every ten years. Calculate what the ground rent would be after 10, 30 and 50 years.
Based on the measure used in Figure 6.3, describe the affordability of housing in the UK compared with:
(a) Romania
(b) Germany
Activity 6.6 The balance sheet as an aid to understanding
risk
Allow 20 minutes for this activity.
1 Which elements of the balance sheet will be affected, and how, by the process of saving for a deposit?
2 Which elements of the balance sheet will be affected, and how, by the process of:
◦ paying the deposit
◦ taking out a mortgage
◦ purchasing a property?
3 In the light of your answers to Question 2, suggest how the current asset ratio and leverage ratio are likely to change as a result of purchasing a home and what this tells you about the household’s financial situation.
Activity 6.8 Non-price influences on the demand for housing
Allow 15 minutes for this activity.
1 What influences other than price and income do you think might increase the overall quantity of housing demanded at every price level and so shift the demand curve to the right?
2 Using Figure 6.10 (or a copy if you prefer), draw in an upward sloping supply curve and describe the effect of the shift in the demand curve on the equilibrium price and the equilibrium quantity
