The Wilson Curve – a model
of housing market dynamics
House prices typically rise and fall in an underlying
cyclical pattern.
The house price cycle also typically follows the business
cycle with local supply and demand factors determining its characteristics
The house price cycle, as with the business cycle, consists
of growth and decline phases.
The Wilson Curve describes the growth and decline phases of
the house price cycle in relation to its price peaks and price troughs.
The Correction Phase
House prices are below the previous price peak of the cycle
but above the previous price trough of the cycle.
The Contraction Phase
House prices are below the previous price trough of the
cycle
The Recovery Phase
House prices are above the previous price trough of the
cycle but below the previous price peak of the cycle
The Expansion Phase
House prices are above the previous price peak of the cycle
