Demand for housing in the UK has been increasing for various reasons such as: An increase in divorce rates Ultimately rising the demands for separate house. The immigration from east Europe And the eastern countries give rise in the demand of houses in UK. Increase in life expectancy and more old single people. Children leaving home early for earning and a thought of getting independent.SpeculationThere are many people in UK who buy houses for the capital gains. The uncertainty in market and rise in unemployment has drawn all eyes away from this business. Increase in interest rates has even attracted the investors to save their money to earn interest. Not everyone buys a house to live in it. An increasing number of property investors buy houses to try and make both capital gains and income from renting. This buy to let investor is typically more volatile, they will buy when house prices are rising and sell when the market appears to turn. This makes house prices more volatile because speculators will buy in a boom and sell in a bust. The number of buy to let investors in the UK has risen in the past decade.However, there are quite high fixed costs in selling a house, such as stamp duty and estate agent fees. It is not like dealing in shares where you can easily buy and sell. Many buy to let investors claim they are in for the long term.The price of rented accommodationAlthough UK house prices have increased faster than inflation, renting has also become expensive which is the main substitute to buying a house.Inherited wealth Increase in life expectancies has decreased the death rates and hence the inherited wealth is distributed lately blocking the amount for a longer time.Division of properties divide the money too. Thus more people get the money to invest. Low unemployment is often associated with rising demand for houses