Thursday, January 27, 2011

Will there be a bull market in Real Estate Sector world over?

It is being mentioned in main stream media that there will be bull market in real estate sector. And there is a perception among the investors that real estate prices are going to move up. Will there be really a bull market in this sector?

Earlier, it was in 2008, there was a big bull market top. The top was followed by a big correction and as everybody knows, it has been a bull market since 2009. Now it is being projected, that the bull market will continue its trend in 2011-2012 period also.

If the present rally continues its uptrend for the next two years, then real estate market is growing after a brief correction. Is it possible for a back to back rally in this sector, that’s to in a span of 4 years. As for as speculative markets are concerned, markets after peaking for a long time takes five to 10 years to consolidate its position.

So back to back rally is not possible in this sector within this 4 years. My view is, the present rally in this sector is a temporary one and it is going to be followed by a big bear market which could last even for a decade. Investment in this sector can be avoided at current levels or you can postpone the decision of buying for another 1 year

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