Pakistani 10 years property cycle
Economic cycles are famous worldwide and are used by economists to predict the future of economy. These economic and empire cycles were derived by famous scholar Ibn Khaldun. The biggest question is what these cycles are, are they real or what is the philosophy behind these cycles?
Economic cycles are definitely real. When something is at bottom, the only direction that can move is upward and vice versa. In property we can say when property prices are record high, the only direction property prices can move is downward and vice versa.
One complete property cycle
Things to observe in the property cycle, or how property cycle works:
Property price peak is followed by price crash or correction
Price crash is followed by price stagnation
Price stagnation is followed by gradual price rise
Gradual price rise is followed by peak price, and another cycle starts
10 years real estate cycle in Pakistan
Every country has real estate cycles and these cycles have different time period. But in Pakistan property cycles are of 10 years. Pakistan property market was at peak in 1995. After 10 years we saw another peak in 2005. Similarly we saw third peak in 2015-2016. So according to these trends we will see next property price peak in 2025-2026.
Global property price trends
Every country has real estate market that has its own fundamentals and works on certain patterns but one thing is for sure that every country’s property market is connected to global property market. When one country’s property market crashes we see global property crash. Many people know that due to credit crunch every country saw property price crash in 2008. Same is true now as we can see property prices crashing in Dubai, UK, India, Pakistan, Europe and many more countries.
New Year property predictions
Everyone is busy in predicting the future trends as we have entered 2017. Many property gurus have predicted real estate price trends. Some are bearish and some are bullish. But what intrudes me is the prediction by one of greatest economist of USA who is predicting 90% property price crash in USA, which will have worldwide effects. Hope it’s just a prediction otherwise Pakistan property market will face bloodbath. I personally wish for stagnant property market in Pakistan that will corrects itself according to new taxes.