Determinants of the upswing phase in the South African real estate growth cycle

Author:

Franken Marika,Bloom Jonathan Z.,Lötter RousseauORCID

Abstract

Understanding and predicting cycles in real estate prices would allow investors to maximise their investment in real estate. This paper builds on the work of a previous study and includes a regression analysis of the upswing phase of the residential real estate growth cycle, which is intended to identify potential leading indicators of an upswing phase in the residential real estate cycle. The results for the upswing phase indicate that house prices, interest rates, growth in household consumption, growth in the South African All Share Index and growth in the Rand-Dollar exchange rate, all lagged by one quarter could be considered to predict the upswing phase of house prices.

Publisher

Virtus Interpress

Subject

General Business, Management and Accounting

Reference23 articles.

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3. Dokko, Y., Edelstein, R.H., Lacayo, A.J. & Lee, D.C. (1999), “Real Estate Income and Value Cycles: A Model of Market Dynamics”, Journal of Real Estate Research. Vol. 18 No. 1, pp. 69-95.

4. Du Toit, J. (2004a), Property Trends: 21 September 2004. New and Existing House Price Comparisons: A Meaningless Exercise?, www.absa.co.za

5. Du Toit, J. (2004b), Property Trends: 25 May 2004. The state of the South African Residential Property Market: Bubble or Boom?, www.absa.co.za

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