Chat GPT and the Property Cycle

The 18.6-year property cycle is a theory that suggests that the real estate market goes through a predictable cycle of ups and downs that lasts for approximately 18.6 years.

The theory is based on the study of historical real estate data and has been observed in several countries around the world. In this article, we will discuss the stages of the 18.6-year property cycle and where we are currently positioned in this cycle.

The 18.6-year property cycle can be broken down into four distinct phases: recession, recovery, expansion, and hyper-supply. Let’s take a closer look at each phase.

The first phase is the recession phase. This phase is characterized by a decline in property prices, high unemployment rates, and a decrease in demand for real estate.

During this phase, there is usually an oversupply of properties on the market, and prices are low. This phase typically lasts for around 3-4 years.

The second phase is the recovery phase. This phase follows the recession and is characterized by a stabilization of property prices, a decrease in unemployment rates, and an increase in demand for real estate. This phase typically lasts for around 4-5 years.

The third phase is the expansion phase. This phase is characterized by an increase in property prices, a decrease in available properties, and a strong demand for real estate. This phase typically lasts for around 7-8 years.

The fourth and final phase is the hyper-supply phase. This phase follows the expansion and is characterized by an oversupply of properties on the market, a decrease in demand for real estate, and a decline in property prices. This phase typically lasts for around 4-5 years.

So, where are we currently positioned in the 18.6-year property cycle?

Based on historical data, it is believed that the US real estate market is currently in the expansion phase. This phase began around 2012 and is expected to continue until around 2020-2022.

During the expansion phase, property prices have been steadily increasing, and demand for real estate has been strong. However, in recent months, there have been signs that the market may be cooling off. Interest rates have been rising, which could lead to a decrease in demand for real estate, and there has been a slight increase in the number of properties on the market.

While it is difficult to predict exactly how the real estate market will behave in the coming months and years, understanding the 18.6-year property cycle can provide valuable insights for both buyers and sellers. Buyers may want to consider purchasing property during the recession or recovery phases when prices are low, while sellers may want to consider selling during the expansion phase when demand is high.

In conclusion, the 18.6-year property cycle is a theory that suggests the real estate market goes through a predictable cycle of ups and downs. Understanding the phases of this cycle can help buyers and sellers make informed decisions about when to buy or sell real estate. Currently, the US real estate market is believed to be in the expansion phase, but there are signs that the market may be cooling off in the near future.

Please read my comments below, VERY IMPORTANT!

Everything above in Italics was written by Chat GPT, the AI program making its rounds in the news for the last 5 months.

My team entered 2 questions into Chat GPT;
1) What is the 18.6 year property cycle?
and
2) Where are we at in the cycle right now?

The above text was the result.

Here is the issue, while it looks good, and largely correct, it is not totally correct.
I estimate it is about 65-70% correct.

Will it get better, sure.
Will it be perfect, no, nothing is..

The first big concern is that at 70% correct you are digesting info that is 30% wrong.
Do you want to make your decisions based on that percentage?
I wouldn’t!

The second concern I have is that we already have an abundance of information, but this is going to take it to the extreme. Right now we have info from people who take time out of their lives, time to create it, even if it is wrong.
Anyone not bothered to create an article won’t.

Now an article can be created in seconds by anyone.

This is good and bad.
It is good if the content is good or the right question has been asked.
but bad if either of these two things are not right.

I am sure some of you think I am just a sore looser trying to hold on to my job.
That is not the case. We have always embraced tech in our business as soon as it was proven to be reliable to use.

AI will be no different for us, however I will say this: It will not be at the price of creativity or flexibility in outcomes.

That is my third and largest concern. As far as I can see, this removes a vital piece of the human personality, creativity. The content becomes bland and without new or original thought.
It also delivers content that is ‘the solution’, the one answer you need, don’t worry, AI has got it!

That is never the case with information or advice, and quite frankly, the thought of people using it like that, is just plain scary.

Back to my bunker…

Final Words..
Want more than rambling from me?
Our team has been fielding requests from people who want to become more immersed in property info.

As such, we are in the process of planning monthly webinars, on top of the live shows, for you to get into one specific topic.

Stay tuned for dates to be released and reply to this email with your interest.

If you want to secure your financial future using property, then contact us here