What Phase of the Real Estate Cycle are we In?

[David Lamb]

Economists:

It is said that there are 4 phases of a real estate cycle: (1) RECESSION (supply greatly exceeds demand and high vacancy rate); (2) RECOVERY (rental growth remains stagnant with little signs of new construction but the economy feels like it is headed in right direction); (3) EXPANSION (job growth is strong and increased demand for housing.  Public has confidence in economy) and (4) OVER SUPPLY (Due to expansion, supply is now starting to exceed demand.  We are at tipping point to return to recession.).

Seems to me (at least in California) like the past 10 years have been in EXPANSION but inventory remains low.  

Do you agree on where we are today and do you have any crystal ball predictions on when we will move to the next phase?

Thanks,

Dave