ARTICLES ABOUT REAL ESTATE CYCLES
This small collection of articles is what Wikipedia would call a ‘stub’ (Wikipedia has its own excellent survey article about real estate bubbles). We attempt to list here a few only a few of the most important articles about housing market cycles.
Real estate cycles and their strategic implications for investors
Stephen Pyhrr, Stephen Roulac, and Waldo Born, 1999
A survey of the existing literature on real estate cycles.
While the presentation is encyclopaedic, the cycle theories presented seem less strongly supported empirically than the writer imagines (though in fairness, the article makes a point of calling for future research into cycles).
The 1985-94 global real estate cycle - Its causes and consequences
World Bank, Bertrand Renaud, May 1995
During the 1985-94 there was massive inflation in many OECD countries’ office and housing markets, peaking in 1990. The boom was linked to the Japanese ‘bubble economy’ set off by lower Japanese interest rates. This prompted Japanese investment at home and overseas. The ‘bubble economy’ ended in 1990, when Bank of Japan governor Mieno raised interest rates from 2% to 6%.
The article shows how the transition of EU banking systems from highly controlled, cartelized systems to much more competitive systems also helped trigger the boom.
Finland was particularly badly affected because its pre-deregulation system had been so tightly controlled. GNP fell 15% in two years, and unemployment rose to 22% by end 1992.
Contrasts in Europe's recent house price cycles
The latest European Union housing bull market cycle is not unique, says Ball, since it resembles the upswing in the 1970s. But resemblance does not mean predictability, since housing price upswings are of irregular duration, and individual countries’ volatilities vary over time.
There does not appear to be a world house price cycle, since Japan, Germany, Austria and Switzerland have been left out of the current cycle.
The factors usually cited as causing this ‘world’ cycle are important (e.g., interest rates). But more important are local supply and demand, demographics, migration, taxation, subsidy policies, macro-economic changes.