What if the best way to predict the housing market isn’t found in complex data, but simply by reading the price trends?

In this episode, Stefan Tsvetkov, founder of RealtyQuant, breaks down how simple price trend analysis can outperform traditional real estate forecasting models. He explores why relying solely on fundamentals may overlook key insights and explains the importance of understanding downside risk in today’s market. Through decades of data and hands-on experience, Stefan shares how investors can build confidence, reduce risk, and make smarter decisions by developing their data-driven intuition.

[00:01 - 05:45] What Price Alone Can Reveal

• Why price trends often outperform fundamentals in predictive accuracy.
• The significance of irrational overvaluation in housing markets.
• How using fewer variables may yield better clarity.

[05:46 - 10:05] The Power of Knowing Less but Knowing It Well

• How building your own data intuition boosts investing confidence.
• Why investors should stop overlooking downside risk.
• The need to simplify decision-making using clear signals.

[10:06 - 15:30] The Truth About Downside Risk

• What makes undervalued markets safer during downturns.
• How historical patterns can forecast future volatility.
• The importance of recognizing where you are in the market cycle.

[15:31 - 21:28] Stability Beats Hype

• How low-volatility markets can offer protection.
• Why investor hype can lead to greater exposure.
• What investors can learn from those who survived the 2008 crash.

[21:29 - 26:31] Making Rational Decisions Your Way

• Why trusting one’s own process matters more than any single model.
• The value of collecting multiple data points to cancel out bias.
• How mindset impacts action more than metrics alone.

Connect with Stefan:

https://www.linkedin.com/in/stefantsvetkov

Key Quotes:

“Real estate isn’t that hard. It’s driven by the same fundamentals: population, income, and housing supply.” - Stefan Tsvetkov

“If you don’t derive your intuition, you’re not going to take action.” - Stefan Tsvetkov

Visit sponsorcloud.io/contact today and unlock $2,000 of free services exclusively for REI Rocks community members! Get automated syndication and investor relationship management tools to save time and money. Mention your part of the REI Rocks community for exclusive offers. Help make affordable, low-cost education summits possible. Check out Sponsor Cloud today!

How can knowing a market’s fundamentals help investors better understand the real risk behind rising property prices?

In this episode, data-driven real estate analyst Stefan Tsvetkov breaks down the relationship between real estate fundamentals and market overvaluation. He explains how factors like income, housing supply, and regression-based forecasting models help reveal where markets may be overheated. Drawing on lessons from the global financial crisis and updated metrics through 2021, Stefan explains how seemingly booming markets may carry hidden downside risk—and why timing corrections is nearly impossible. With county- and state-level insights, this episode is a valuable guide for any investor who wants to gauge risk more accurately and avoid misleading hype.

[00:01 - 06:00] Fundamentals Don't Lie

• How price-to-income ratios reveal overvaluation risk
• Why state-level data shows stronger correlation than county-level analysis
• The significance of 83–87% correlation during the 2008 crisis

[06:01 - 12:00] Real Estate vs. Stock Market Logic

• How real estate is easier to value than equities
• Why appraisals and valuation models make market inefficiencies more visible
• The importance of knowing whether your asset is fairly valued

[12:01 - 18:00] Warning Signs from Western States

• Why western states showed early signs of overvaluation in 2021
• How wage growth lagged behind real estate price growth
• The need to balance asset appreciation with rising downside risk

[18:01 - 24:00] Forecasting vs. Fundamentals

• Why price forecasting and market valuation are not the same
• How income-based models don’t need interest rate adjustment
• The value of long-term trends in identifying safe markets

[24:01 - 28:11] Where to Look Now

• Why undervalued states like Indiana and Kentucky might offer better downside protection
• The importance of mixed-method analysis for forecasting and risk
• How to approach hot markets like Boise and Phoenix with caution

Connect with Stefan:

https://www.linkedin.com/in/stefantsvetkov

Key Quotes:

“Real estate is a fundamental asset. If prices deviate from fundamentals, corrections follow.” - Stefan Tsvetkov

“People say real estate is hyper-local, and that's true. But it's also harder to predict at the hyper-local level.” - Stefan Tsvetkov

Visit sponsorcloud.io/contact today and unlock $2,000 of free services exclusively for REI Rocks community members! Get automated syndication and investor relationship management tools to save time and money. Mention your part of the REI Rocks community for exclusive offers. Help make affordable, low-cost education summits possible. Check out Sponsor Cloud today!

Why does using just price data often outperform traditional market fundamentals in predicting real estate trends?

In this episode, financial engineer and real estate investor Stefan Tsvetkov explains why relying on price trends can be more accurate than using population, income, or job growth to forecast appreciation. Drawing from years of data modeling and firsthand investment experience, Stefan breaks down the mechanics of momentum in real estate markets and introduces tools for predicting downside risk. He also shares lessons from the 2008 crash to highlight the risks of ignoring valuation. This is a numbers-based look at smarter, leaner ways to evaluate and choose real estate markets.

[00:01 - 06:00] The Case for Price Over Fundamentals

• How price data leads to fewer forecasting errors.
• Why adding more variables increases uncertainty.
• The importance of simplifying your analysis.

[06:01 - 12:43] Momentum in Real Estate

• How last year’s prices help predict this year’s.
• Why many markets show strong trend patterns.
• The significance of autocorrelation in market forecasting.

[12:44 - 18:51] Forecasting with Models

• How tools like ETS help spot short-term trends.
• Why 2021 broke from historical patterns.
• The need to update models as trends shift.

[18:52 - 24:37] Population Growth vs. Price Performance

• Why population explains only part of the trend.
• How combining metrics offers a fuller view.
• The importance of watching overvalued markets.

[24:38 - 27:44] Measuring Downside Risk

• How past crashes linked to overvaluation.
• Why fundamental misalignment increases risk.
• The importance of tracking valuation gaps.

Connect with Stefan:

https://www.linkedin.com/in/stefantsvetkov

Key Quotes:

"You commit a five times bigger error trying to model future appreciation with fundamentals than if you just look at prices alone." - Stefan Tsvetkov

"Real estate is a fundamental asset. When prices deviate far from fundamentals, downside risk increases significantly." - Stefan Tsvetkov

Visit sponsorcloud.io/contact today and unlock $2,000 of free services exclusively for REI Rocks community members! Get automated syndication and investor relationship management tools to save time and money. Mention your part of the REI Rocks community for exclusive offers. Help make affordable, low-cost education summits possible. Check out Sponsor Cloud today!