Q) The demand for new houses in Australia has held up relatively well, compared to other developed countries experiencing the fall out from the global financial crisis. This has resulted in the state and federal government actively releasing new land to build on in order to meet the increase in demand. However, economists believe that the release of new land will not fully meet the increase in demand for new houses.

Using demand and supply analysis, explain what will be the impact of the Government action on price and quantity in the market for new houses.

A) New land being released to the public means an increase in supply. We will see a shift in the supply curve to the right resulting in an increase in quantity and decrease in price. The equilibrium quantity increases and the equilibrium price falls.

Is what I answered correct? How can I elaborate more on this?