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To clear up PK's questions about the 18.6year cycle there are 3 points that weren't made: 1) Everything that happens in the World's largest economy (The USA) will eventually spread and happen in all other Capitalist Economies. Hence why it's relevant to Australia even though the study was done in the USA, the UK. 2) He didn't mention on the fundamental of this cycle hypothesis and that's 'Economic Rent' how everything in the economy will flow back into the land values, everything flows back into the land. So the effects of the mid-cycle down turn for example will take effect first in the Stock Market indicated by the bond yield curve inverting (short term bond yield is higher then long term bond yield) . This is another factor that backs this hypothesis up. 3) In the same way that the USA is the major economy and everything that happens there will happen across other economies around the world. This Cycle Hypothesis also holds true first and foremost in Australia's major economies first and that's Sydney and Melbourne. All other secondary economies that PK specialises in (Regional or smaller markets) will see this cycle hold true after the major economies of Syd & Melb see the effects first. Hence why PK sees two tiers of markets and why he can't tie it together and when he posed this question he didn't get the answer he needs to tie it together.
Some interesting points. You're right that the first markets to boom after the recovery tend to be the major metropolitan centers and financial hubs (London, New York, Sydney), and then in the 2nd half of the cycle this flows out to the secondary cities and regional towns as it turns into more of a "general land boom". However, this seems to be a bit of a general truth rather than an absolute truth, as there are exceptions to this rule.
Well done, I think PK needs to look further into this - I'll even buy the book for you! Can you do further questions with Pumped on Property or Jason pizzino?
Inflation. Property prices went up, and so did cost of living. Which means from all that money printing, its crashing up. Everything is getting more expensive, the currency is loosing purchasing power.
Look at the 1970s and what happened to Australian property during that decade. We are at the end of the 50year property cycle. I’m surprised the 50 year cycle wasn’t mentioned
I agree , example my suuburb 10 years growth was 1 percent, which os also common with suburbs I'm perth, so perhaps the next 8 years could be good. There was 22 percent growth in 2 years how're compared to 10 years it was only 2 %, so the 10 year roi was minimal
The housing shortage wasn't really the topic of this discussion. The current housing shortage is the cause of a supply & demand imbalance, but it is not causal of the longer wave-form RE cycle. There is something important to consider with the housing shortage, as it relates to the 18 year cycle... There are other times in history where there are large housing supply imbalances, not associated with these boom conditions.There are also times when housing supply is in balance and booms occur. It's not the only factor - credit availability is a key ingredient.
People normally have a ‘strategy’ call with my team to explain their situation and what they are trying to achieve. During this call we discuss your personal circumstances and your property goals, and honestly we will tell you whether we believe we can help you. If it's a fit, we go through everything so you know exactly how the course will help achieve your goals. Then we'll work together and get it done.
This is perhaps the most unscientific concept we've seen on your channel yet PK 😆 I always prefer pragmatism, this reminds me of horoscope readings - reality can't be modelled like this IMO. Interesting & entertaining video to watch though, enjoyed it😃
Perhaps, the future is never certain so we will have to wait and see! The scientific method is; observe, form hypothesis, test, analyse, prove / disprove, and then repeat! We will only know for sure after the fact. Invest accordingly...
There are just too many other factors for this crap to hold water- women in the workforce, people having kids later/and less of them, cheaper and cheaper goods from China. Baby boomers retiring. Immigration. Foreign investment. Easy credit-tighter credit. First home buyer grants. Tax breaks.
Anyone following Stock market, would know - we are now well beyond winners' curse since 2021-Nov, (most stocks down 20%, with Tech stock even worse near pre-pandemic) & my Guess is there is a Lag from when Stocks are down vs. when Real estate feels the impact. A large weight in CPI is Shelter (say 33%) likely to get impact from FED's hawkish rate hike (2 x 50 bps could be revised even higher) after US CPI hit new high last Friday at 8.6% (led by Energy & Fuel 50~100%). My gut feeling real Inflation is much higher simply because CPI probably doesn't capture how Owner-occupier (upgraders who sell & buy in same inflated market) inflates Existing Property market with renovation stimulus during 2020 (say in Sydney & Mel), must have increased their monthly Repayment to a higher weight than 33% as US FED, AU RBA starts hawkish rate hike to min 2.5% by year end. ATO just released that Construction development sector owes a staggering $7.22 billion for FY2020 (I wonder why? even after Real estate made > 30% growth)
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To clear up PK's questions about the 18.6year cycle there are 3 points that weren't made:
1) Everything that happens in the World's largest economy (The USA) will eventually spread and happen in all other Capitalist Economies. Hence why it's relevant to Australia even though the study was done in the USA, the UK.
2) He didn't mention on the fundamental of this cycle hypothesis and that's 'Economic Rent' how everything in the economy will flow back into the land values, everything flows back into the land. So the effects of the mid-cycle down turn for example will take effect first in the Stock Market indicated by the bond yield curve inverting (short term bond yield is higher then long term bond yield) . This is another factor that backs this hypothesis up.
3) In the same way that the USA is the major economy and everything that happens there will happen across other economies around the world. This Cycle Hypothesis also holds true first and foremost in Australia's major economies first and that's Sydney and Melbourne. All other secondary economies that PK specialises in (Regional or smaller markets) will see this cycle hold true after the major economies of Syd & Melb see the effects first. Hence why PK sees two tiers of markets and why he can't tie it together and when he posed this question he didn't get the answer he needs to tie it together.
Thank you!
Some interesting points.
You're right that the first markets to boom after the recovery tend to be the major metropolitan centers and financial hubs (London, New York, Sydney), and then in the 2nd half of the cycle this flows out to the secondary cities and regional towns as it turns into more of a "general land boom".
However, this seems to be a bit of a general truth rather than an absolute truth, as there are exceptions to this rule.
Excellently articulated points.Its so true since US market is what needs to be seen as they have benchmarked n formulated the cycle like this.
31:09 important point. Austin Mackell has written about that.
As an economist it surprises me that people who study the property cycle haven’t looked at the inflation cycle. They have blinkers on.
Well done, I think PK needs to look further into this - I'll even buy the book for you! Can you do further questions with Pumped on Property or Jason pizzino?
Thank you
That was a great discussion.
Inflation. Property prices went up, and so did cost of living. Which means from all that money printing, its crashing up. Everything is getting more expensive, the currency is loosing purchasing power.
Look at the 1970s and what happened to Australian property during that decade. We are at the end of the 50year property cycle. I’m surprised the 50 year cycle wasn’t mentioned
This is a great explanation, I love this
Credit to jarryd!
I agree , example my suuburb 10 years growth was 1 percent, which os also common with suburbs I'm perth, so perhaps the next 8 years could be good. There was 22 percent growth in 2 years how're compared to 10 years it was only 2 %, so the 10 year roi was minimal
great video looking forward to next cycle.
great explanation as property being a derivative that they can make money from lending.
Have you looked at price of gold by comparison?
Love this!
Was the housing shortage mentioned?
The housing shortage wasn't really the topic of this discussion.
The current housing shortage is the cause of a supply & demand imbalance, but it is not causal of the longer wave-form RE cycle.
There is something important to consider with the housing shortage, as it relates to the 18 year cycle...
There are other times in history where there are large housing supply imbalances, not associated with these boom conditions.There are also times when housing supply is in balance and booms occur. It's not the only factor - credit availability is a key ingredient.
Where does Elliot 3 wave theory fit in? I can see 3 waves in it. I wanna be a property guru.
I'm looking to buy my own town house to live towards the middle to end of next year, a 5-10% drop is good, 15-18% is even better.
I got a new idea my bro.. bhpl
Like buy now pay later
House now pay later lol, like zip and only monthly interest
Hi PK
How do I purchase your course asap?
It says I have to book a call?
People normally have a ‘strategy’ call with my team to explain their situation and what they are trying to achieve.
During this call we discuss your personal circumstances and your property goals, and honestly we will tell you whether we believe we can help you.
If it's a fit, we go through everything so you know exactly how the course will help achieve your goals. Then we'll work together and get it done.
This is perhaps the most unscientific concept we've seen on your channel yet PK 😆 I always prefer pragmatism, this reminds me of horoscope readings - reality can't be modelled like this IMO. Interesting & entertaining video to watch though, enjoyed it😃
I agree 😂
Perhaps, the future is never certain so we will have to wait and see!
The scientific method is; observe, form hypothesis, test, analyse, prove / disprove, and then repeat!
We will only know for sure after the fact.
Invest accordingly...
There are just too many other factors for this crap to hold water- women in the workforce, people having kids later/and less of them, cheaper and cheaper goods from China. Baby boomers retiring. Immigration. Foreign investment. Easy credit-tighter credit. First home buyer grants. Tax breaks.
Hmmmm
Anyone following Stock market, would know - we are now well beyond winners' curse since 2021-Nov, (most stocks down 20%, with Tech stock even worse near pre-pandemic) & my Guess is there is a Lag from when Stocks are down vs. when Real estate feels the impact. A large weight in CPI is Shelter (say 33%) likely to get impact from FED's hawkish rate hike (2 x 50 bps could be revised even higher) after US CPI hit new high last Friday at 8.6% (led by Energy & Fuel 50~100%). My gut feeling real Inflation is much higher simply because CPI probably doesn't capture how Owner-occupier (upgraders who sell & buy in same inflated market) inflates Existing Property market with renovation stimulus during 2020 (say in Sydney & Mel), must have increased their monthly Repayment to a higher weight than 33% as US FED, AU RBA starts hawkish rate hike to min 2.5% by year end. ATO just released that Construction development sector owes a staggering $7.22 billion for FY2020 (I wonder why? even after Real estate made > 30% growth)
Winners phase is only starting now mate. 2026 or so is when the crash is expected.
Thanks guys!
I’m learning so much with your content PK 🫶🏼
Thanks so much mate