The rental market in England in recent years has been mainly influenced by the financial crisis. This is partly because high property prices exclude many first-time buyers from the housing market. First-time buyers are young people who have recently left college or are ready to move out of their parents' or other homes. In most cases there is not much money available yet, just some savings and there are fewer and fewer properties for first-time buyers on the current market. As financing becomes increasingly difficult and income prospects become less and less good, young people in particular are struggling to get onto the property ladder. For them the rental market is an important alternative because it does not take away all their savings and is more convenient. However, this will have an impact on the rental market in the coming years, as more and more people tend to rent properties today, both young and old. The supply of rental units in London is inelastic in the short term, due to the time it takes to build new houses and apartments. There is an increase in the demand curve, as more people demand housing, this is shown in diagram 1, the demand curve shifts to the right, so rents will increase from P1 to P2. On the other hand, in the long run the supply of rentals will be significantly more elastic, as there will be sufficient time to build new properties or to transform them into new and improved properties. Therefore, if the increase in demand is maintained over a period of time, there will be an increase in rents on the rental market, from the first to the second quarter, and an increased supply of rental properties on the market, as shown in diagram 2. The usual demand and supply curve changes as follows in the real estate market. If there are also… half of the paper… those who cannot afford the high prices are interested in the rental market, and as the demand in the rental market increases, with it the price of rental properties also increases as well. The options for those looking for accommodation in the UK are currently expensive. The government is working to provide more properties to sell and buy at a cheaper price, but it will take a few years before the property market is cheaper again. Works Cited Begg, D., 2009. Fundamentals of Economics. 4th edition. Berkshire: McGraw-Hill Education.Blink, J. and Dorton, I., 2007. IB Diploma Programme: Economics Course Companion. Oxford: Oxford University Press.King, M., 2011. Rents hit record highs as housing demand outstrips supply. The Guardian, [online] 15 July. Available at [Accessed March 20 2014].