Real Estate and Other Markets are All About Cycles

Real Estate Agent with GreatWest Realty DRE# 00827565


Without a doubt one of the more surprising things I’ve experienced in my better than 3 decades as a Real Estate Professional, is just how quickly markets can change direction, after what has been a prolonged downturn.  I saw it occur in the early 1980s, and then again in the 1990s. 

This more recent brisk housing turn in the Greater Sacramento region, is a testament that it’s happening once again.

I have followed home listing and sale statistics for years.  In fact, I often create the little graphs, which I post here on my blog.  If you want to know the difference a year can make in Sacramento housing, try wrapping your arms around the idea that there were approximately 10,000 homes on the market at the peak of the recent Buyer’s Market; BUT with this current Seller’s Market we are experiencing a significant shortage of available homes for sale – approximately 1200.

The lesson learned from housing and other economic cycles, is just that!  They are mere cycles!  It takes time for markets to find their equilibrium when a shift has occurred.

The especially good news emerging recently is home prices in the region rose approximately 7% in 2012, with a prediction of about 12% increase for this year.  More homeowners are finding themselves in a more positive equity position, with fewer being underwater.

Real Estate Professionals, who once were predominantly performing short-sales, now report more activity spent on traditional listings and sales.  And, that is certainly a good thing!

I’m not known for making predictions, because it’s far too easy for unknown events and factors to shake up the marketplace.  However, I suspect the shortage of available homes listed for sale will improve somewhat, as homebuilders continue to wake from their long slumber to create habitats for us all.  What do you think?


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Tom Arstingstall, General Contractor, Dry Rot, Water Damage Sacramento, El Dorado County - (916) 765-5366
Dry Rot and Water Damage Mobile - 916-765-5366 - Placerville, CA
General Contractor, Dry Rot and Water Damage

Myrl - We do see cycles in so many industries. Those that have been around for a while have learned how to succeed in all phases of the cycle.

Mar 21, 2013 05:55 PM #6
Sheila Anderson
Referral Group Incorporated - East Brunswick, NJ
The Real Estate Whisperer Who Listens 732-715-1133

Good morning Myrl. I think you are exactly right and markets, all markets are cyclical whether it is real estate stock or food. Everything changes bases upon factors that impact them. Grat post: suggested.

Mar 21, 2013 10:27 PM #7
Steve and Jan Bachman
RE/MAX Gateway, Reston, Herndon, Ashburn, Sterling, Fairfax - Herndon, VA
Realtors - Northern Virginia

Same here Sept. 2008 there were 21,000 homes for sale in Northern VA. Last week there were 4300. Good for sellers. Tough for buyers.

Mar 21, 2013 11:28 PM #8
Chris Ann Cleland
Long and Foster REALTORS®, Gainesville, VA - Bristow, VA
Associate Broker, Bristow, VA

The one cycle that's surprising me is the call for less restriction in mortgage underwriting.  Didn't we learn our lesson by making money easy to borrow?

Mar 21, 2013 11:38 PM #9
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Endre - Ain't it the truth!  Markets are often truly ran on "Herd Mentality."

William - For years I have said I'd like to see consistentcy in both price increases and inventory.  Alas, the pendalum often swings exhuberantly in one direction or another. . .Balance please - Balance - Balance - Balance!

Tom - You are correct about cycles hitting many industries.  Building trades are closely aligned with housing and real estate.  Survival for the professionals navigating the terrain can sometimes be very difficult.  I recently read somewhere that New York City had something like 27,000 real estate agent, with only a tiny fraction of that equating to sales.  There is sometimes a place where the reality of numbers drowns out any knowledge of being able to succeed.

Mar 22, 2013 12:03 AM #10
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Sheila - The market often looks like a Tango on the dance floors with the dancers carrying switchblades:-)

Steve - The difference between the inventory of last year in comparison to this, makes the market appear totally schizophrenic!

Chris Ann - You and I are on the same page with restrictions!  How in the world can we even contemplate returning to practices, which caused so much of the housing collapse?

Mar 22, 2013 12:08 AM #11
Gayle Rich-Boxman Fishhawk Lake Real Estate
John L Scott Market Center - Birkenfeld, OR
"Your Local Expert!" 503-755-2905

Myrl, there are 4 million less this year who are underwater....that's just one of the facts I learned yesterday on an NPR program about the housing market, the good and the bad. I just wrote a post about it last night, with some positives/negatives and some words of encouragement from Lawrence Yun, the chief economist for NAR.

There are some thoughts about California, we're on the same wavelength!


Mar 22, 2013 02:16 AM #12
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Gayle - That number of people who are no longer underwater is very encouraging!  I am reminded of my own home which I purchased in 1983.  I watched it go up to double in value in less than 10 years, and then lose some, then gain once again, and even at the very worst of this latest crisis, the house was worth twice what I had paid for it.  Sometimes, when folks are in the thick of it, they have difficulty understanding it's a cycle.

Mar 22, 2013 02:46 AM #13
Tony & Darcy Cannon
Aubrey and Associates Realty - Layton, UT
The C Team

Myrl, It is certainly cyclical!  We are in a market with little inventory as well.  Have a great weekend!

Mar 22, 2013 10:22 AM #14
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

This year, we have really seen how quickly the real estate market can change.  Home buyers are facing a major inventory shortage and multiple contract competition when they were expecting bargains.

Mar 23, 2013 09:01 AM #15
Joni Bailey
101 Main St. Realty - Huntsville, TX
Your Huntsville / Lake Livingston Area REALTOR®

Like you, our buyers do not have nearly as many choices as they have in the past. It is a bit frustrating. Properties priced right, and in good condition are moving. Our market doesn't see a lot of multiple offers.

Mar 23, 2013 01:53 PM #16
Wayne Johnson
Coldwell Banker D'Ann Harper REALTORS® - San Antonio, TX
San Antonio REALTOR, San Antonio Homes For Sale

Myrl-Your cogs with the interlinking gears is right on point. Jobs, provide funds for home buying. Where there is good employment there are home sales.

Mar 23, 2013 02:55 PM #17
Mary Douglas
United Country Ponderosa Realty, Red Feather Lakes, Colorado - Red Feather Lakes, CO
REALTOR, Red Feather Lakes, Colorado

Hi Myrl, I hope more sellers will get back in the market and provide Sacarmento with much needed inventory, and bang, bang, bang get those nail-guns  out and get back to building....I agree!

Mar 24, 2013 10:39 AM #18
Kwee Huset
Kwee Huset Realty - Venice, FL
Venice Florida Homes For Sale

Hi Myrl,  you are right real estate market is all about cycles, just like the water cycle  and weather

Mar 24, 2013 12:21 PM #19
Kristin Hamilton CA Realtor
Sun Lakes Realty - Banning, CA
(909) 557-6966- Specialize 55+ Communties Banning

Hi Myrl,

We are getting so many standard sales and very few short sales and REO's. This is showing a great turn around in the market. Thanks for sharing and Suggest!

Mar 24, 2013 03:29 PM #20
Toni Weidman
Sailwinds Realty - Trinity, FL
20+ Years Selling Homes in New Port Richey, FL

I've always compared it to a roller-coaster ride, Myrl. I like your cycles although this last one lasted way to long. I too see a better market ahead. Suggested.

Mar 24, 2013 11:16 PM #21
Patricia Feager, MBA, CRS, GRI,MRP
Selling Homes Changing Lives


Not only are you a great REALTOR® you make an excellent Reporter too!

You're right about it being a Roller Coaster Ride and you're the woman who can make the ride enjoyable too. You're exceptional at what you do and your years of experience is a feather in your cap. You can handle change and get the job done too.

I would have confidence in you if you were representing me - and that's the truth!



Mar 25, 2013 03:56 PM #22
Yolanda Cordova-Gilbert
Richmond, TX
Myrl, I know I commented on this before, but like others have said some of these comments seem to be disappearing! I hope you are having a wonderful Good Friday. Yes the real estate market is cyclical but if you buy in a good neighborhood you can stay the course.
Mar 29, 2013 07:09 AM #23
John G. Johnston
John G. Johnston & Associates, LLC - Westcliffe, CO
An Exclusive Buyer's Agent ~ Westcliffe, CO

Myrl   Isn't it funny how we consider real estate an investment.  I always ask clients "What do you really want?"  I have always lived life to be happy, not as an investment.  Happy Easter

Mar 30, 2013 02:00 PM #24
Carol Williams
Although I'm retired, I love sharing my knowledge and learning from other real estate industry professionals. - Wenatchee, WA
Retired Agent / Broker / Property Manager

Hi Myrl,
The only thing constant is change, isn't it? 

Jun 13, 2018 05:21 PM #25
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Myrl Jeffcoat

Greater Sacramento Real Estate Agent
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