Vitas: First of all the 18 year Real Estate cycle is not mine, but it is a cycle recognized by the Foundation for the Study of Cycles. Also note, that it is a rolling cycle for different parts of the country.
The cycle is 9 years up and 9 years down. However, it can vary slightly. The up/down cycle phase can sometimes just be a reduction of momentum or flating of the dominant trend. That is what happened in California for years during the down cycle until the eighties.
The 18-year Real Estate cycle should continue to head down and start accelerating.
Sorry, my above statement was really inaccurate! I was just a getting a little exuberant and a little premature. <g>
For instance, Texas started down in the early eighties. I guess the top was around 1981/82. The market has recovered, but prices never made it back to the previous highs. However, timing would put Texas near the next peek. And just as last time, the cranes are everywhere.
New York is not a beacon for the rest of the country. I believe Texas lead the last slump. I moved to Denver in early 1982 and it followed Texas by a couple of years. I then moved to Southern California in late 1983 and its market topped about 1985/86. And for the first time for living Californians the prices began to fall. I knew several individuals that wanted to refinance in the early nineties, when rates dropped big time, but could not because they owed more on their homes than they were worth. Homes had dropped 15% to 40% depending on location and price range. A big shock for the Southern California crowd.
I am not familiar with the New York real estate market, but I did market some land to real estate developers in New Jersey for a family member. The family member had been receiving request to purchase the land from developers for several years prior to the peek around 85/86 if memory serves me correctly. She passed up a great offer and held out for more. The market tanked and she eventually sold years later for 30% of what I could have sold it for.
You will have to do your own math for your area.
Regards,
LG |
