We have all heard about business, and Real Estate market roller coaster rides or cycles but what does that really mean? The following images show the typical stages of a market cycle and a brief history of business cycles:
When it comes to Real estate there are theories and researches that can be used as a guide. We should never forget that Real Estate is local and these information might only be used to help us get a better general understanding and in no way should replace the local market indicators. One of the famous theories is The Great 18-Year Real Estate Cycle:
The most recent real estate bubble in the U.S. is the largest in our history and there has been no pleasure in taking this ride for anybody. Losing an average of $70,000 per household and over 9,000,000,000,000 as a country is an unwanted set back for many of the homeowners! Following chart shows the effects of the bubble in the last 5 years in my local area.