Introduction to Market Cycles Quiz

1 point(s)

In which phase of the housing market cycle is new construction limited due to stabilization post-recession?

Recovery

Correct Incorrect Correct answer

Expansion

Correct Incorrect Correct answer

Hyper-supply

Correct Incorrect Correct answer

Recession

Correct Incorrect Correct answer

1 point(s)

Which phase of the housing market cycle is characterized by an oversupply of properties leading to increased vacancies and possibly declining property values?

Recovery

Correct Incorrect Correct answer

Expansion

Correct Incorrect Correct answer

Hyper-supply

Correct Incorrect Correct answer

Recession

Correct Incorrect Correct answer

1 point(s)

The recession phase in the housing market cycle is often marked by high unemployment and reduced consumer spending.

True

Correct Incorrect Correct answer

False

Correct Incorrect Correct answer

3 point(s)

Identify three historical examples of the housing market expansion phase in the U.S. and briefly describe each.

Sort elements

Driven by a strong economy and increased housing demand
Characterized by easy access to credit, subprime lending, and rapid property value increase
Resurgence in housing market driven by low interest rates and strong economy

Mid-to-late 1990s

Correct Incorrect Correct answer

Mid-2000s

Correct Incorrect Correct answer

Early 2010s

Correct Incorrect Correct answer

1 point(s)

What is a recommended strategy for investors during the recovery phase of the housing market cycle?

Over-leverage on new construction projects

Correct Incorrect Correct answer

Invest in undervalued properties

Correct Incorrect Correct answer

Focus solely on selling properties

Correct Incorrect Correct answer

Ignore market conditions

Correct Incorrect Correct answer

1 point(s)

Arrange the phases of the housing market cycle in order.

Correct Correct Answer Incorrect

View Answers:

1 point(s)

During the hyper-supply phase, it is advisable for investors to heavily invest in new construction projects.

True

Correct Incorrect Correct answer

False

Correct Incorrect Correct answer

3 point(s)

List three tips for investors during the recession phase of the housing market cycle and briefly explain each.

Sort elements

Focus on maintaining a conservative investment strategy to preserve capital
Look for opportunities to acquire distressed properties at a discount but be cautious about the risks
Be prepared for potential declines in property values and rental income.

Preserve capital

Correct Incorrect Correct answer

Acquire distressed properties

Correct Incorrect Correct answer

Prepare for declines

Correct Incorrect Correct answer

1 point(s)

Arrange the following actions based on their advisability during the hyper-supply phase from most advisable to least advisable.

Correct Correct Answer Incorrect

View Answers:

1 point(s)

Reflect on how understanding the housing market cycle could inform a real estate investor’s decisions regarding when to buy, sell, or hold properties. Use historical examples provided in the chapter to support your reflection.

This response will be awarded full points automatically, but it will be reviewed and possibly adjusted after submission.

Introduction to Market Cycles Quiz