The real estate market cycle
I am in the process of reading the rei beginners guide and was looking at the real estate market cycle. I understand how this works, but I was wondering. Can be small areas on a different stages of the market cycle being completely different separate from the big picture?
If so how to the relate to one another?
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- Realtor, General Contractor, and Developer
- Redding, CA
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Joey Meighan Welcome to BP! Maybe you can put a pic on your profile, so that all of us can see you, makes it a little more personal.
As the saying goes, 'all real estate is local'. Every area has their own set of issues that drive local markets. From the types of industry, employment rate, educational opportunites, training of work force, and family income. Along with all of that is the political aspects, and the overspending of local governments (in California anyway) All of those things impact local markets.
On the other hand, say in California. We have areas like Orange County which is doing relatively well, and is strong in all those things I mentioned, and other areas that have unemployment up around 20% still, with no economies to speak of.
As the market picks up in the more stable areas, and grows to full strength again, people start looking at investing in 2nd homes, etc., and oftentimes those homes are in areas that are great tourist areas, but were very hard hit in economic downturns. As investors begin buying properties in those area, their local economies begin to pick up, along with housing, etc. and the cycle begins!!
- Karen Margrave