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Article: The maturing of the real estate industry. (Executive Essay).
- Article from:
- Mortgage Banking
- Article date:
- January 1, 2003
- Author:
CopyrightCOPYRIGHT 2003 Mortgage Bankers Association of America. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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IN THE NOT-TOO-DISTANT PAST, THE REAL estate industry was considered by most as one of the last inefficient frontiers: an investment class where, with a little luck and perhaps a lot of "inside scoop," one could do quite well. Unfortunately, the converse of this axiom was also true, and the massive losses this sector suffered in the late 1980s and early 1990s proved that imperfect market information could lead to disaster.
The well-documented facts are that real estate markets entered the late 1980s recession burdened with significant oversupply. This supply problem was caused mainly by inappropriate tax laws and undisciplined borrowers and lenders.
The ...