Like every other market, timing the property market is never easy – and the slow-moving nature of real estate presents additional problems. If you’re a buyer, the drawn-out process can mean you wind up overpaying or underpaying for an asset simply because its value has moved after you placed your offer. That is not such an issue for most individual residential buyers and sellers, for whom a property is typically a roof over their heads, a long-term investment, or both. But for housebuilders and real estate investment trusts (Reits), the nature of the industry means they are developing assets for a market that could be completely different from when they first put a spade in the ground – or pen to blueprint paper.
Stock market investors can at least avoid these time lags. But better liquidity doesn't help answer the key question: when is a good time to buy, and when is a good time to sell? Clearly, there is no way of knowing for sure ahead of time, and individual shares offer their own valuation metrics for investors to analyse. When viewing the market in sum, a proper assessment of a range of indicators, as well as knowledge from previous downturns, can also help.