For the last five years or so the Federal reserve has been working hard to keep interest rates low (by printing money and calling it “stimulus”). Last week, they announced they would taper their stimulus, which should cause a spike in interest rates. As a fellow real estate investor, I asked the obvious question: how will this influence the home prices?
Pundits love to get television and spout how increased interest rates will make it more expensive to borrow money, which in turn will deflate home prices. Any talking head can come up with a theory, but you can’t place any value on it until there is evidence to support it.
So…what does the data say?
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