The real estate expansion cycle is at a mature stage, nevertheless it is still growing. Supply of new housing is still less than demand. Los Angeles is one of the big cities with a supply deficit, new construction is less than population growth. That’s why rents, occupancy and returns are rising. “There is nothing imminent that suggests that this [growth] cycle is about to end,” said a prominent real estate analyst last week. The housing market is at a 30-year low of inventory of home for sale. There may be an increase in housing starts.
Uncertainty in the stock market makes investors cautious and there is presently a lot of uncertainty. The strongest part of the current bull market is probably over. It looks like lower returns ahead, yet the consensus is that the bull market is not finished.