Here’s another way to look at the Property Cycle

We all know the property market moves in cycles.

And we also know that the markets have moved to the next phase of the cycle…

But today I’d like to introduce you to another way of looking at this cycle to help predict what’s ahead for our property markets.

Typically the cycle is depicted in 4 stages.

The boom is followed by the downturn, which is followed by the stabilisation phase, which leads to an upturn, which in turn sets us up for the next property boom.

I’ve drawn it as follows:


I’m often asked how long between one property cycle and the next

A  “7 year property cycle” is often referred to by property market commentators, but it’s rarely seven years. 

In fact, average Australian capital city prices have had multiple cycles over the last 15 years with booms around 2003, 2007, 2010 and 2017 the one we’ve just experienced on the east coast of Australia.

Of course the length of a property cycle has nothing to do with the number of years.

Cycles are driven by a series of socio-economic factors, but over the years I’ve noticed that the nature of our property cycles is changing and up until recently they seemed to be getting shorter.

Also the cycle is better seen in terms of the rate of property growth, as not all downturns or bust phases have price declines, but some just experience a slowing.

However the current property cycle is likely to be different!

It seems that our current climate of low interest rates, low inflation and low wages growth that should produce a different cycle – one that has lasted longer and one where prices won’t fall as cycle

By the way… we’ve experienced similar conditions before in the 1990’s.

Looking back these were good years in property – at least they were for me – and I’ve already set myself up to take advantage of the next few years.

Of course the cycle can also vary from city to city.

Recently only the Sydney and Melbourne property markets experienced strong boom phases.

And there are even cycles within cycles within each capital city.

Interestingly in all the years I’ve been tracking real estate, I’ve never seen our property markets  as fragmented as they were this cycle.

House price growth



The main factors driving the property cycle are:

  1. Interest rates and the availability of funds to buy property – when money is cheaper (interest rates are low) this is positive for property markets – Clearly the availability of finance (or lack of it) has been a  major influencer over the last few years
  2. The Economy – business confidence , employment prospects, jobs growth and wages growth all create demand.
  3. The availability of supply of property to meet this demand.
  4. Consumer confidence
  5. Demographics – in particular household formation (again affecting demand.)

The Wilson Curve

Interestingly Dr Andrew Wilson, one of Australia’s leading housing market experts, presents the cycle in a different way.

He uses another model that he calls the Wilson Curve which gives a very different perspective of what’s going on.


Wilson also says house prices typically rise and fall in an underlying cyclical pattern.

The house price cycle also typically follows the business cycle with local supply and demand factors determining its characteristics

The house price cycle, as with the business cycle, consists of growth and decline phases.

The Wilson Curve above describes the growth and decline phases of the house price cycle in relation to its price peaks and price troughs.

The 30 second video below shows you the Wilson Curve in action:

The Wilson Curve consists of…

  1. The Correction Phase   – House prices are below the previous price peak of the cycle but above the previous price trough of the cycle
  2. The Contraction Phase – House prices are below the previous price trough of the cycle
  3. The Recovery Phase – House prices are above the previous price trough of the cycle but below the previous price peak of the cycle
  4. The Expansion Phase – House prices are above the previous price peak of the cycle.

Where is each State in the Wilson Curve?

At my upcoming round of national property seminars in 4 capital cities in March and April I have organised a panel of experts, including Dr. Andrew Wilson, to give you their unfiltered and unedited analysis of where we are heading as a country and how that will affect you, your family, your business and your real estate investments.   property time market clock house cycle investment timing watch growth

Andrew will give all attendees a detailed handout of his latest research including where each state in the Wilson curve plus a lot more.

Click here now and get all the details of my National Property and Economic 1 day trainings and reserve your place.

If you had attended my seminars last year or the year before – and more importantly if you would have taken the correct action – you would now be sitting feeling pretty smug.

By the way…since we have no properties for sale, it’s always been easy to give independent unbiased facts about what’s going on.

The world is changing, our property markets are changing and we can’t wilfully ignore the changes, but for those at this event, we help you discover how to prosper in the next few years.

So please click here now to get all the details and reserve your spot and a FREE spot for a friend.

See you there.


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Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and one of Australia's 50 most influential Thought Leaders. His opinions are regularly featured in the media. Visit

'Here’s another way to look at the Property Cycle' have 18 comments


    February 14, 2018 steve weingarth

    Michael I ‘m a follower of real estate cycles and believe that it is more like 14 years rising land values that also push along the economy and shares-so the period 2011 to 2025 should be good for home prices. About every 14 years there is a 4 year recession, then a repeat of the good times. On this basis,backed by history,we should see a recession around 2015/26 with a milder mid year correction in housing values in 2019. Up until then there will be price growth but not as much as the crazy prices of the last few years,especially in Sydney and Melbourne.
    Can’t make your Sydney seminar this time but what do you think of this? Also when should Brisbane housing finally show some decent gains for investors as it has been very slow growth there for a decade.

    Steve Weingarth


      Michael Yardney

      February 14, 2018 Michael Yardney

      Steve – sure the future will resemble the past – but it won’t mirror it.
      Clearly the concept of a recession every 14 years is not correct – the RBA and APRA have done a lot to flatten out the cycle – so in the future our highs won’t be as high, but our lows won’t be as low.
      Interestingly the concept you’re asking about is one of the models that Dr Andrew Wilson will be discussing at our upcoming seminars



    March 1, 2017 Harri Saharinen

    Hi Michael,
    What about the investors’ “investment cycle ” ? Most people invest for the long term, without thinking of a exit strategy. When to sell ? Why sell? How does it effect your retirement ? How to cash in on the increase in values without continuing to purchase more properties ?
    How many people want to manage properties in their retirement? I understand it is very personal and varies greatly by individual circumstances. Just I have never seen a viable “exit plan ” as such , or even know if there is a such a thing.


      Michael Yardney

      March 1, 2017 Michael Yardney

      Harri – of course there is an end strategy – if you don’t have one you shouldn’t begin.
      I explain it clearly in my books – have you read any of them?



    March 1, 2017 John

    Hi Michael,
    There is a danger investing in “apartments” in capital cities, one I purchased in Adelaide, 2Br + Office + 2Bath + 2 Car parks, purchase price $520k. Now current replacement cost valued by professional auditor is $2.5M and is also certified by an accounting firm, chartered accountant.
    Seems a lot of people think all apartments are the same, which is probably a big mistake. Regards,



    February 17, 2016 David Pillinger

    Hi Michael , I have been to one of your seminars and enjoy your articles,I find them very much focused around Sydney and Melbourne , not that this is a problem for me personaly however being based in Perth and hhaving the majority of my investment focus in Perth i find the details limited on the lower populated citys , i appreciate the demand on the big cities but the opportunities particularly in entry level propertys is vast in the lower populated citys such as Perth, so do you have any data or focus you would like to share with us on the perifial citys or is it all about the big 2 and the rest just wait for the next sea change or mining boom to get there time in the spotlight?.


      Michael Yardney

      February 17, 2016 Michael Yardney

      David, you make some good points, but I’ve been conducting seminars in Perth for 12 years now.

      I’ve seen a number of cycles come and go. When it was appropriate I recommended attendees at my seminars, and my clients, invest in Perth and they did very well. I regularly had local Perth experts make recommendations to attendees. With affiliates helping our clients in Perth for many years so I’m not biased to just the East Coast.

      However as the property cycle moved on I was concerned about the Perth property market and (now in retrospect) correctly recommended that attendees at my Perth seminars looked further afield. Those who did and invested in Sydney and Melbourne have done very, very well.

      Similarly for a number of years (2003-2008) I did not recommend Sydney, but as the cycle changed I again correctly recommended investing in the Harbour City.

      As I have no properties for sale, so I’m not biased where my recommendations are, and similarly you shouldn’t be focused on investing in your hometown.



        February 17, 2016 IRENE

        Hi Michael,
        I enjoyed your articles on email and find them very much focused around Sydney and Melbourne.
        Please help me to decide.
        Where to invest in Brisbane, Qld and Sydney?
        Is Macquarie Shopping ‘s Apartments, Maroubra, Kingford’s apartment (Airport), Killara, Parramatta, Eastwood, Epping, Carlingford, Chatswood, Randwick good pick?
        Will try to attend your seminar, one of these days.
        Thank you.


          Michael Yardney

          February 17, 2016 Michael Yardney

          I can’t advise you without knowing your budget, your aims, your timeframe’s, your risk tolerance, your current investments etc.

          But I would avoid new apartments.
          And why wouldn’t you come to a seminar this year? We have no properties to sell. And it sounds like you still need to learn a few things

          By the way…you say I’ve been focussing on Sydney and Melbourne over the last few years- that’s true, but think about it – which have been the best performing markets?



    March 2, 2015 Craig Turnbull

    Steven, I agree with Michael. I used to spend a lot of time examining statistics and trying to work out where to next for the market or particular suburbs. But stats don;t take in to account the macro-economy or other external factors that we can’t account for. Best thing to do is to educate yourself, make a great plan, take a long term view – invest for 20-30 years not 2-5 years



      February 17, 2016 Sean

      I think the point being raised, is exactly the point being missed.

      As Michael points out time and time again, as does the Wilson curve. The property market continues to repeat itself, why change a system that works? Inventing a new ‘curve’ or system won’t change what history has already told us.

      We need to learn from what has already happened, be prepared for the cycles and invest for the long term. And keep drawing up the Wilson curve to out children, family and peers to help them understand that property is a powerful tool to become financially independent!

      Keep up the great work Michael!



    February 25, 2015 Steven Kay

    So we all understand how the property cycle works. I would like you to predict based on this curve the next 5 years Sydney prices.
    And of course, forget the word depends !!! Give or take a few %


      Michael Yardney

      February 25, 2015 Michael Yardney

      I have never tired to predict the future – anyone who thinks they can is fooling themselves.

      I don’t even know who our Prime Minister will be next month



    February 25, 2015 Harry

    The Wilson curve is hardly a great revelation, anyone with any history in property investment could have come up with that.


      Michael Yardney

      February 25, 2015 Michael Yardney

      Yes they could Harry
      But they DID’T



        February 25, 2015 Craig Turnbull

        Michael, thanks for the continuing great work on your blogs. Always fabulous to read well-informed viewpoints. I must agree however this time with Harry. The “Wilson Curve” that your economist friend Mr Wilson has so importantly named, has been around for many years. I was drawing it up on whiteboards in the early 2000’s for seminars I was teaching. And I didn’t invent it. I do hope your one day trainings go well – I am sure they will be informative.


          Michael Yardney

          February 25, 2015 Michael Yardney

          Great to hear from you. Yes we all know how the property cycle works. Maybe it comes across better when Andrew Wilson explains it


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