Have you noticed If you talk to investors generally they always...

Have you noticed If you talk to investors generally they always understand there are cycles, times when its worth being invested and times when you move out into something else for a while. Or times when you want to buy but its best just to sit it out a little longer first before entering in.

Housing is the only option i have found where even though history shows very clearly it goes in up and down cycles, always returning back to its lows, and just follows CPI over the decades, that the majority of investors seem to ignore the historic data and truly believe this cycle is different it will just only go up now.

I would love to understand what causes this as it is very frustrating to listen to, and worries me as some of these people i know well and are buying up to 3 or more houses with their super (which is a great thing to do if they were buying at the bottom of the cycle).

They seem to also believe that inflation will eventually bring the house price back up to what they paid for it if it does go south on them. But dont understand that not only is the house now worth less in that situation, but the banks will always increase the interest rate to cover that inflation so they actually end up paying the inflation ontop of their principal as well.

The other thing I have noted is the people that this usually applys to generally only invest in property, You never see this kind of thinking with investors who will also invest elsewhere.

I know a lot of people who made a lot of money out of investing in houses, including my parents. They all admit though they made a lot more than they bargained for as they did not expect those increases 10 years ago.. those ones are out the market now and have no interest at buying in at these prices..