REAL ESTATE CYCLES

 

Real Estate values move in a continuing economic cycle. Understanding the general principles of the economic cycle is key to successful real estate investing. Within the same market place Office, Retail, Multi-Family and Industrial properties may be at different phases in the the commercial real estate cycle.

Continuous Real Estate Cycle, Tampa Commercial Real Estate

A closer examination of an individual Real Estate Cycle shows that each cycle has definite phases and there are stages within each phase

Real Estate Cycle, Economics, Tampa Commercial Real Estate

Recovery Phase
  • Decreasing Vacancy Rates
  • Low New Construction
  • Moderate Space Absorption
  • Low to Moderate Employment Growth
  • Negligible to Low Rate Rental Growth
Expansion Phase:
  • Decreasing Vacancy Rates
  • Moderate/High New Construction
  • High Absorption
  • Moderate/HighEmployment Growth
  • Med/High Rate of Rental Growth
Over Supply Phase:
  • Increasing Vacancy Rates
  • Moderate/High New Construction
  • Low to Negative Absorption
  • Moderate to Low Low Employment Growth
  • Medium to Low Rate of Rental Growth
Recession Phase:
  • Increasing Vacancy Rates
  • Moderate to Low New Construction
  • Low Absorption Rate of Space
  • Low to  Negative Employment Growth
  • Low to Negative Rate of Rental Growth

 

 

 

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