The real estate market is a complex and dynamic system of property ownership, investment opportunities, and development. Global trends reveal a diverse landscape, with growing urbanization in developing markets driving demand for residential and commercial properties (World Economic Forum, 2019). In addition, technological advancements and innovations in construction are shifting real estate practices. For example, the COVID-19 pandemic has prompted a shift towards sustainable and energy-efficient buildings, driven by environmental concerns and supportive government regulations (World Green Building Council, 2021).
Understanding real estate market trends is critical for investors, developers, homebuyers, and sellers. It helps them identify the best investment opportunities and ensure that they make informed decisions. As a result, it’s important to follow economic news and stay up-to-date on job growth, interest rates, and tax policies that affect the real estate industry.
In the expansion phase, high demand for properties typically drives up property prices and construction activity. This can be fueled by low-interest rates, economic growth, and positive demographic trends. The plateau phase, or stabilization period, usually occurs when supply and demand balance, resulting in stable property prices and slowdown in construction activity.
The contraction phase usually occurs when the economy contracts, leading to decreased demand for properties. This can be a result of economic factors, such as an increase in unemployment or decreasing consumer spending, or a change in government policies that impact the real estate sector. As a result, real estate investments may become more risky and volatile.