What is the main concept behind the Principal of Supply and Demand?

The main concept behind the Principle of Supply and Demand is that market value is determined by the interaction between the availability of properties and the level of interest from buyers. This principle illustrates how the price of a good or service changes in response to changes in supply (the quantity of a product that producers are willing to sell at various prices) and demand (the desire of consumers to purchase a product at various prices).

When demand for properties is high and supply is low, prices tend to increase. Conversely, if there is an oversupply of properties and demand is low, prices generally decrease. This dynamic relationship highlights how both the quantity of properties available and the buyers' readiness to purchase influence the market value. Understanding this interaction is crucial for real estate professionals and investors, as it allows them to make informed decisions based on current market conditions.