The cyclical nature of residential housing markets

Cycles are an integral part of most capitalist societies. They are openly acknowledged and researched in certain real estate segments, such as the commercial office market. Although the 'seven year cycle' is often discussed in regards to residential real estate, there has been relatively little research undertaken in this area. Therefore this paper seeks to fill this void by commencing an investigation into residential housing market cycles. It commences with an overview of established theories in cycle research. An analysis of a large number of Brisbane suburbs over an extended time period was then undertaken using Fourier Analysis. The results suggested cycles were observed in a number of Brisbane suburbs, with consideration also given to differences in spatial patterns and property values.