The Big Picture On The Real Estate Cycle: Understanding the real estate market cycle is an important guide for informed investment decisions.  Investors should focus on generating positive cash flow during recessions or uncertainties as a safer strategy, rather than relying on market appreciation. Using less leverage is recommended to minimize risk during market downturns, which allows investors to maintain stability and control over their investments.  Disclaimer The information provided on this website is for general informational purposes only and should not be construed as legal, financial, or investment advice.  Always consult a licensed real estate consultant and/or financial advisor about your investment decisions.  Real estate investing involves risks; past performance does not indicate future results. We make no representations or warranties about the accuracy or reliability of the information provided.  Our articles may have affiliate links. If you click on an affiliate link, the affiliate may compensate our website at no cost to you. You can view our Privacy Policy here for more information.    All markets are cyclical. As an investor, you need to understand the real estate cycle—or risk being a victim of the next real estate crash. But that doesn’t mean you should try to time the market. Instead, just understand where we are in the housing market cycle at any given moment and how to protect yourself against future housing downturns. The real estate market will dip, sooner or later, deeper or shallower. That leaves the question of how well you’ve prepared for the ups and downs of the real estate life cycle.   The Normal Real Estate Cycle In a real estate crash, demand disappears even as supply continues growing. Because construction takes many months or even years to complete, it takes time for new supply to slow down to meet lower housing demand. In point of fact, most investors are cautious these days, with investment volume going down 60% in Q2 2023.  Falling home prices spooked buyers and sellers alike, and the entire real estate industry contracted. But at a certain point, prices dropped low enough to spur demand again. Real estate prices level off and gradually start climbing again in the recovery phase. Real estate values rise alongside demand, and then, as values rise, supply follows suit. Property owners increasingly grow tempted by high housing prices to list their homes for sale. Homebuilders gradually pick up the pace of construction until, once again, housing inventory starts outpacing demand. Eventually, a housing bubble can form when prices outpace local supply and demand. Because it’s worth a thousand words, here’s a real estate cycle chart courtesy of Marshall Funding: Notice that vacancies are the metric used to measure the balance between supply and demand. In your particular real estate market, pay close attention not just to the actual vacancy rate but also to the direction in which

So I had heard that a must see when visiting New Zealand were the glowworms at Waitomo. It’s about a two and a half hour drive from Auckland and way back in 2018 when my Mom and I were originally planning this trip Down Under, we were going to rent a car and drive around … Continue reading Review: Glowworm Waitomo & Ruakuri Cave Tour From Auckland, New Zealand

Vanguard recently announced that they are selling their individual 401(k), multiple-participant SEP, and SIMPLE IRA plan business to Ascensus (press release). They’ve already updated their small business retirement plan page. One-person SEP IRAs will stay at Vanguard. Ascensus will provide custodial and trustee services, recordkeeping, client servicing, transaction processing, tax reporting, and other services, and plan participants will retain access to a diverse lineup of Vanguard mutual funds via the Ascensus platform. This will affect […]

YNAB and Empower are two of the most popular budgeting tools today. The right budgeting tool can help you achieve your financial goals. While You Need A Budget (YNAB) and Empower are both worthwhile options, the right choice will depend on your preferences and the tools you care about the most. In this breakdown of YNAB vs. Empower, we cover the features and user experience of both platforms. We also highlight the differences to help […]

I KEEP SEEING THEM—overly complicated, overly expensive investment portfolios. The most recent belonged to a widow in her 70s, with modest earned income, Social Security benefits and about $5,000 in taxable fund distributions for 2023. She was someone I helped during the recent tax-filing season, when I was volunteering at an AARP TaxAide site in Monmouth County, New Jersey. Her portfolio held about a dozen mutual funds, most of which I’d never heard of. It […]

By Dr. Jim Dahle, WCI Founder Real estate investing is almost synonymous with making mistakes. In few other fields of endeavor have so many learned the craft in the school of hard knocks. However, it’s far better to learn from the real estate investing mistakes of others than to make them all yourself. Whether you are investing actively or passively, avoid making these mistakes.   #1 Paying Too Much There are very few investments in […]

I had created this spreadsheet to help my wife and I keep up on our household chores. It worked for both of us. She wanted a paper list and I wanted something easy to maintain. I describe the spreadsheet and the process here. In this article I’ll go step by step how I dressed it up to sell on Gumroad. I wrote an article about the tool “Wait a second,” you may be thinking. How […]