4 Lessons All Property Investors Must Understand About Property Cycles
Shane Hiscock
Director at Locate Buyers Agency | Brisbane’s 5-star property buyers agent | Taking the stress out of property acquisition
Hi all. Found an excellent article that I am sure many will relate to. Hope you get something useful out of this...
The economy and our property markets move in cycles
And the main cause behind these cycles is that we’re human and tend to share the general optimism or pessimism of others.
It’s a common fallacy that Australian property cycles last 7 – 10 years.
They vary in length and are affected by a myriad of social and economic factors and then, at times, the government lengthens or shortens the cycle by changing economic policies or interest rates.
For example, the current property cycle is being prolonged by a period of historically low interest rates.
Yet it’s my observation that investment markets often “overshoot.”
That is, they move by more than changes in the fundamental influences would seem to require – on the upside as well as the downside.
Take the Perth property market which experienced significant growth (overshooting its fundamentals) during the recent mining boom.
And now home prices have fallen 20% from their market peak in Perth and are likely to fall further.
Looks like really useful info, eh? Just click the link https://propertyupdate.com.au/4-lessons-property-investors-must-understand-property-cycles/ to find out more from the horse’s mouth! If you’d like to share perspectives or discuss how it relates to your business, call me on (0402) 024-625 or email me at [email protected].
Director at 3D Retail Economics & Australian Lease and Property Consultants Pty Ltd seeking to expand SaaS across Globe
8 年Hi Shane ............. I am not talking up a market correction; just FACT or based on FACT. There are IDIOTS calling for further ZERO bound interest rates; these are people who clearly are clueless about economics; monetary policy; metrics and modelling on minor movements in interest rates off low low metrics. Or consequences ............. it will be negative multiplier effect when interest rates go up. The consequences will be far far worse than if Central Banks had moved towards "neutral" monetary position of 3.5 to 4.5% in 2010/2011 ............ or thereabouts.