What is the impact of economic cycles on housing and land prices?

Economic cycles have a profound impact on land and housing prices, as evidenced by historical events such as the 2008 financial crisis. During economic expansions, demand for housing typically increases due to rising incomes, consumer confidence, and access to credit, which generally drives up prices. Conversely, during economic downturns, demand can plummet, leading to oversupply and a decline in property values. The 2008 crash serves as a prominent example where the burst of the housing bubble caused significant and rapid depreciation in housing prices and land values. This cycle highlights the relationship between economic conditions and real estate, where fluctuations in economic health directly correlate with changes in land and housing prices.