ABSTRACT
Generally it is important to recognize that demand and supply in each property sector are tied to property cycles and that these have occurred at regular intervals during the post-1945 period. In the commercial property market the reduction in interest rates has resulted in a substantial increase in investment demand. From the bottom of the cycle, housing demand increases as first-time buyers enter the market with the perception that house prices can only rise and that they should buy before that occurs. The supply of new properties for occupation is tied closely to the economic cycle because it is only in good trading conditions that firms are willing to occupy additional space. Land-owners additionally recognize the need to find an investor who is willing to purchase the property when it is complete, and therefore much development occurs when both the occupier demand and the investment demand are expected to be strong.
