The price of real estate tends to move in an 18-to-20-year cycle. From one top to the next bottom, as from one bottom to the next top, about 9 or 10 years usually elapses. The Moon’s Nodes move backwards or retrograde in an average 18.6-year cycle around the Zodiac. Most real estate price tops have occurred with the North Node in Taurus and/or moving into late Aries.
The Nodes are points where the Moon’s orbital path intersects with the Sun’s path. The Moon’s Nodes influence mass psychology, which translates economically to ups and downs in interest rates, employment and productivity. A real estate calculation called the Brennan Cycle moves in tandem with the Moon’s Nodes. Where real estate is concerned, the 20-year cycle of Jupiter-Saturn conjunctions is also of interest. Jupiter, the influence of optimism, energizes speculative buying, and cautionary Saturn is associated with land.
From an astrological perspective the expectation is that real estate prices should rise when the North (Jupitarian) Node moves through Cancer, the Sign most associated with Home. The North Node arrived in Cancer in April 2000 and moved into Gemini October 2001, when a bubble in stock prices crashed. The Fed lowered interest rates to stimulate the stock market, which in turn brought a dramatic rise in home buying, creating what is seen now in retrospect as a speculative bubble in real estate.
This latest surge in RE prices peaked in the spring of 2005 when the North Node moved from early Taurus into late Aries. Prior to this latest speculative bubble in real estate prices, history shows tops occurred with the North Node in Taurus or Aries—unless distorted by other planetary cycles, especially those coinciding with wars or depressions.
Through the 1800s, RE price tops were made in 1819, 1837, 1857, 1873 (distorted by the great depression of the 1870s) and 1893. In 1819, the North Node was in Aries; in 1837 moving from Taurus into Gemini; 1857 moving through Aries into Pisces; 1873 and 1893 moving through Taurus into Gemini.
The next top occurred in 1918, 25 years after the top of 1893 with the North Node moving into early Sagittarius. The Federal Reserve System (Fed) was created by Congress in 1913, shifting control of the US monetary system to a group of bankers, and institutionalizing a debt-based money system. Henceforth, the bankers of the Fed sold dollars into circulation. In effect, the government borrows money from the Fed’s bankers and sticks the public and/or taxpayers with the bill at ever-compounding interest.
Another definitive RE cycle top was made on the cusp of the Great Depression 1929. At this time the North Node was again in Taurus and moving into Aries. Through the roughly 40 years of the Great Depression and the aftermath of World War II, real estate prices made no dramatic tops, as the Fed now controlled interest rates. And to curb an expected spike of inflation, the Roosevelt Administration imposed price controls during and after World War II. Construction of new homes boomed through the late 1940s and 1950s. The next definitive RE top in prices came roughly 4 cycles after 1893, or 80 years later in 1973.
Prior to the creation of the Fed in December 1913, interest rates (which drive real estate development and buying) were unregulated. The prime duty of the Fed is to control interest rates. Nevertheless RE prices returned to their correlation with the North Node when calculated over longer periods of time, as evidenced by the most recent top arriving in 2005 with the North Node moving from early Taurus into late Aries, roughly five Lunar Nodal cycles after 1893.
By March 2007, with the Node moving through Pisces, there were plenty of economic indications that RE prices were on a determined downswing. Some “sub-prime” lenders and borrowers were in trouble. The number of building permits issued nationally had plummeted. In suburban Las Vegas, the fastest growing area in the USA, 9,800 of roughly 22,000 homes on the market were empty and desperate home sellers were cutting prices by 45%.
Based on past history, we can expect the downtrend in housing to turn around when the North Node reaches the constellation opposite Cancer, where it usually is when prices rise. That constellation is Capricorn and the North Node is due to enter it in August 2009, 20 years after the last low in 1989.
But don’t rush headlong into the real estate market in 2009 without being aware of two major reasons the RE cycle may again be distorted and its downside extended.
1. Astrologically, Uranus and Pluto will be within orb of a square, with Pluto opposite the US natal cluster of Venus, Jupiter and Sun in Cancer. And Saturn will be moving through Virgo, coming conjunct the US Neptune, which is square the US Mars—a combination that has coincided with stock market crashes historically. Also, in 2009 Pluto and the North Node will conjoin in Capricorn. The combined effect of these astrological patterns bodes ill for the overall economy, of which the housing industry is a major part.
2. Because the recent housing price bubble was extended and taken to new record highs, its deflation may be extended. We may experience a crash of the dollar and a subsequent spike in inflation, causing the Fed to raise interest rates dramatically. Also waiting in the wings is the weather-related effects of global warming, expected to bring catastrophic storms, Hurricane Katrina being a hint.
If the dollar crashes or continues its slide down against other world currencies, foreign investment in US assets (a major stimulus to the most recent housing bubble) will be withdrawn, worsening the situation by exacerbating US debt—federal, corporate and personal. The world’s monetary system, now based on the dollar, is likely to go through a wrenching change, mainly because US total debt is approaching the point where it will be un-repayable, which in turn could lead to a change in the existing Fed-dominated, debt-based monetary system.
When Congress created the Fed in 1913 and institutionalized a debt-based money system, it meant that, instead of the federal government lending money into the system at no interest, bankers lend money into the system at ever-compounding interest. In turn, this creates a gradual but snowballing rise of inflation, as the money to pay the interest must be “found,” and the primary “finder of interest” is inflation, called “the hidden tax.” What $100 bought in 1913 now costs around $2,000.
The Virtuous Circle