This is facinating and I’m wondering if it is possible to actually predict some of these things with some degree of certaintly, unlike the stock market which is nearly perfectly efficient. New information and tracking past performance with stocks really doesn’t help (Modern Portfolio Theory) since everyone is doing the same thing and information absorbtion is nearly instantaneous. Even active portfolio managers have a worse track record than the S&P500 index.
It’s always been clear to me that housing presents opportunities to uncover hidden gems and underpriced properties, but do you think this advantage extends to analyzing past trends to predict the future? You gain information in doing so with stocks, but that does not give you an advantage because the market is too efficient. Since housing is very local, and far from a perfectly efficient market, it would seem that strong past analysis can in fact provide you with a huge advantage.
JGs great charts got me thinking about this the other day!
