"Buy at the trough" is advice you can only follow backwards

It's falsifiable if you make it about deliveries instead of about prices. Permits pulled today become units delivered in roughly 18 to 30 months for a garden product, longer for wrap or podium. So the delivery schedule for the next two years is already fixed and it's public in most jurisdictions. You can count it. If your submarket's deliveries drop 45% in 2027 and absorption holds anywhere near trend, occupancy improves. That's a checkable claim about buildings, not a mood about the cycle.

At my scale the trough shows up as who's calling me. When the wholesalers go quiet and the listing agents start returning calls, something changed. It's a lagging signal too, just a cheaper one to collect.

The version I can act on is the boring arithmetic. If the price supports the debt service and a reasonable reserve at today's rents with no growth assumed, then whether it's the trough stops mattering very much. Every deal that needs the trough to be the trough is a deal that needs to be right about timing.

The trough isn't the constraint for most buyers right now anyway, the debt is. A lender sizing to a 1.25 coverage ratio at today's rate gives you a loan amount, and that loan amount sets the price you can pay regardless of what you believe about 2027. Values are 20 to 30% off partly because the debt got smaller. If rates come in, that reverses before any of the occupancy improvement shows up.

girder's point about counting deliveries is the only thing in this thread I could actually do on a Saturday. Where do you get the permit data, is that county by county or is there somewhere it's aggregated?

Census building permits survey covers the metro level and it's free. Submarket granularity you're either paying a data vendor or driving around counting cranes, and I know people who genuinely do the second one.

The institutional version of "do something with it" is pacing. Nobody credible tries to hit the bottom with one check. They set a deployment schedule, three or four acquisitions a year across two or three years, and accept that some will be early. That's not sophistication so much as an admission they can't call it either. The advantage patient capital has isn't better timing, it's the ability to be wrong by eighteen months without a lender forcing a sale.

Construction costs are the part I'd watch that nobody in this thread has counted. If materials and labor stay where they are, the replacement cost side of that gap doesn't come down to meet the value side, and new supply stays off the table longer than the permit data alone suggests. If costs actually fall, builders come back sooner and the whole recovery window narrows. rigging, that's at least a number you can check quarterly.