Understanding the 3 Stages of each Property Cycle Phase offers many benefits in property investment.
These benefits include;
- Risk minimisation
- Proactive investing
- Contrarian investing
- Wealth growth acceleration
- Decision making confidence
- Identifying optimum buying and selling times
- Clarity of which strategies to employ and when
Interested in the NZ property cycle?
Then click here for more on the historic view of the Auckland Property market cycle and the Property Cycle Clock.
WHAT ARE 3 STAGES OF EACH PROPERTY CYCLE PHASE?
Within each of the Boom, Slump and Recovery phases of the property cycle, there are three distinct stages.
These stages signal the beginning, middle, and the end of each stage within a phase.
People often refer to the current property cycle phase without defining whether the phase is at the beginning of that phase or its end.
WHY ARE THE 3 STAGES OF EACH PROPERTY CYCLE PHASE IMPORTANT TO KNOW?
The importance of knowing which stage the cycle is in at any given time is paramount. Why? Because there are different cyclically sensible strategies to employ which are dependant on which stage of the phase the cycle is in.
For example, it is smart to land bank during the Recovery and beginning stage of the Boom. However not so wise to do so at the end stage of the Boom and beginning of the Slump.
Evidence exists in the form of clues that indicate which phase the property cycle is in. Equally evidence also exists to indicate the specific stage of each phase at any given time.
When it comes to property investment it pays to have a good understanding of which stage the property cycle is at, in relation to the phase it is in.
That way we can know which strategies to employ, when and why. Rather than just blindly investing in any property we can be more strategic about our investment decisions.
We can make timing our friend instead of a potential enemy!
