Investing in real estate would be a profitable venture at this time. A

here is my reasoning

clearly A and B strenghthen,

C is irrelevant

between D and E , i will choose D because we dont know how many readers constitute 85%.

With the same opinion,

Say if there are 10000 citizens and only 1000 reads the House magazine then out of those only 850 are planning to buy a second home.

Thus actually it represents only 8.50 % of the citizens..

Hence with (D)

I second your reasoning. Perfectly highlighted.

Ok, but the last sentence is saying that ''the current supply of homes could only provide for 65% of THAT demand (or 65% of 850) each year''. If the study is regarding specifically the demand of House Magazine readers, D wouldn't be right. It was only me who had this interpretation?

I had the same interpretation.

TWIN QUESTION: https://gmatclub.com/forum/investing-in ... 69846.html

I have a doubt. The premise says that 85% of survey takers want to buy a 2nd house and only 65% of that demand could be met. *current supply of homes could only provide for 65% of that demand each year*. If only magazine readers want to buy a 2nd house, doesn't that mean demand > supply, therefore the prices will go up?

Please help me out guys

The weakness against the argument lies in the fact that it's pretty much unsure if this sample population of readers is representative of the demand for buying 2nd home. This in turn brings up the conclusion that these readers can be more willing to want to buy and hence do not actually represent the increasing demand.

As always, this problem is about a poor sample of respondents. The answer D is absolutely correct. On the other hand, planning something and actually doing it is different. For example, I was planning to buy a new house, but I wasn't able to do it, because I didn't have the money for it, lol. But two months ago I've inherited a house in Coventry and sold it to this https://www.thepropertybuyingcompany.co.uk company. Now I have enough money for the actual buying a house somewhere. And now I don't have only plans, but a possibility.

I would like to know if that statistic still stands today, notwithstanding the flaws in the argument anyway (the magazine may have only had 20 readers or 5 take the survey). With properties spiking at the moment, but expected to fall in Q1 next year I suspect there will be more people selling to companies than buying. The second home in the countryside is now more likely to become the main home. And buying pied a terres in the city seems less appealing.

There is a fundamental flaw in the language of the question, the questions says 65% of 'that' demand... even if there are 100 readers to the magazine and 85 of them are wanting to own a second home, the current supply is only enough to meet 65% of 'that' demand i.e. 65% of 85 people... Option E touches upon people actually building a home themselves and opening out an option for people to actually build a home rather than relying on the 'supply' of homes... as per the current language E should be correct, however, common logic says this is highly unrealistic to have supply for only 65% of magazine readers... I choose Option E as per the question

Please help if there is a flaw in my reasoning

I totally agree and used the same logic to choose E as the answer. Can any expert please throw some light on why D (and not E) is the correct amswer? If the passage itself states, *that* demand, then i think it is referring to the 85% magazine reader population, and not the entire population.

KarishmaB Bunuel GMATNinja

Posted from my mobile device

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Premises:
A survey in House magazine revealed that 85% of the magazine's readers are planning to buy a second home over the next few years.
A study of the real estate industry revealed that the current supply of homes could only provide for 65% of that demand each year.

Conclusion:
Investing in real estate would be a profitable venture at this time.

Based on the survey results, the author is assuming that 85% of the population wants to buy a second home and then reaching his conclusion. What is the weakness in the evidence cited? What if the this sample for the survey does not represent the population?
That is what (D) says.

(D) Readers of House magazine are more likely than most people to want second homes.

We get the 85% figure because people who buy this magazine are the ones who want to buy a second home. Say people who buy the National Geographic magazine have no interest in buying a home at all. Those who buy no magazine may want only one home etc. We don't know. The point is that a weakness in the evidence is that the sample may not represent the population accurately. If readers of House magazine are more likely than most people to want second homes, then the 85% figure for the whole population is inflated.

(E) House magazine includes articles about owning a second home as well as articles about building a second home.

Irrelevant. We do not know whether people want to themselves build new houses or not. We know their preferences for owning houses only. Just because the magazine has articles doesn't mean that people want to build their second homes themselves. Also, we are talking about investing in the real estate sector, not buying ready houses. One could invest in real estate sector by buying land. One would profit even if people want to build their own houses and not buy the current ones because they will need to buy land to do so.

Answer (D)

@KarishaB, the argument says that 85 percent of the magazine readers are interested in a second home. The second survey says that 65 percent of THAT demand can be met. The language of the argument suggests that only 65 % of 85 % of readers will have their demand fulfilled in the current market. As per the language of the argument, the demand will always be greater than the supply (considering all those who are interested actually buy the house).
So, how can we assume D weakens the evidence. The supply and demand in the argument is from the point of view of this small subset (readers of the magazine)

The best answer here is (D) Readers of House magazine are more likely than most people to want second homes. This choice points out a flaw in the survey's logic because it assumes that the preferences of House magazine readers represent the general population. Just because 85% of their readers plan to buy a second home doesn’t mean the same high interest exists outside of that group.

This is like when a prop trading firm routing system uses data specific to certain traders but doesn’t apply those results across the board. The magazine’s survey sample might not reflect the broader demand for second homes, which weakens the argument that investing in real estate is universally profitable right now.