![]() Thus, the real estate market and individual renters and homebuyers will start generating demand once again. The expansion phase is when the general public will start regaining their confidence in the economy. The general economy is improving, job growth is strong, and there is an increased demand for space and housing. You can wait out the rest of the recovery period by adding value to these properties so that they are ready to sell or rent outright as the economy shifts into the expansion phase. This is a great time to pounce on below-market value properties that are in various states of financial or physical distress. ![]() However, this is where real estate investors must keep a close watch and act quickly at any signs of recovery. Rental growth will remain stagnant, with no signs of new construction. Identifying the recovery phase of the cycle can be tricky, as most of the nation will still be feeling the effects of a recession and have a bleak outlook. This may induce some anxiety for you as a real estate investor, but fear not! The great news here is that investment strategies make it possible to invest successfully across these cycles. This implies that historically, there has never been a sustained expansion or hyper-supply period without an eventual recession, followed by recovery. The real estate cycle comprises four main phases: recovery, expansion, hyper supply, and recession.
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