Real Estate and Interest Rates

The Surprising Truth About Interest Rates and Real Estate Values

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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During Kenny's decade in finance he bought many single family rentals in rural areas, as a hobby. Along the way, he talked some brave souls into joining him as investors and recently retired from finance to take his hobby to the next level. Keep up to date with everything he's doing on twitter!

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One thought on “The Surprising Truth About Interest Rates and Real Estate Values

  1. EL @ MoneyWatch101

    This is a timely post, as many people get really scared to purchase if they see interest rates going up. I personally felt that way, but when you pay a bigger portion in cash for a home then you don’t need to worry yourself with interest rates. I am planning to leave a 40-50% down payment no matter the rate.

    Reply

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