interest rates going up?!

[David Rubin]

Hi

i'm starting out in real estate trying to buy my first properties but seeing the interest-rates going up keeps me still being 

what are the best options in the real estate market  even with high rate

please if you can help me out 

thanks 

md rubin

[Karl B.]

"what are the best options in the real estate market even with high rate"

For those of us who have seen the writing on the wall, we've been stacking cash. In no time, interest rates will be up another 2-3 points and in most markets prices will fall, as will the level of competition. 

[Theresa Harris]

Find a market where the numbers work.  Interest rates will keep going up as they have been artificially low for too long.

[David Rubin]

Quote from @Theresa Harris:

Find a market where the numbers work.  Interest rates will keep going up as they have been artificially low for too long.

 thanks for your reply. another small  Q - even if i find something that the numbers make sense now (for a rental income ) if the interest-rates goes up can it effect my rental income ?

[Scott E.]

Quote from @Karl B.:

"what are the best options in the real estate market even with high rate"

For those of us who have seen the writing on the wall, we've been stacking cash. In no time, interest rates will be up another 2-3 points and in most markets prices will fall, as will the level of competition. 

 I am envious of your ability to predict the future

[Scott E.]

Quote from @David Rubin:

Quote from @Theresa Harris:

Find a market where the numbers work.  Interest rates will keep going up as they have been artificially low for too long.

 thanks for your reply. another small  Q - even if i find something that the numbers make sense now (for a rental income ) if the interest-rates goes up can it effect my rental income ?

 As long as you get a fixed rate loan, then no your cash flow will not be impacted if you buy now and rates continue to go up.

[Patricia Berman]

Hi David,

Considering the rising interest rates and the uncertainty in the market, my belief is that the best way to enter the market and build a portfolio is through purchase of primary residence.  

You only have to live in the property for one year and then you can move out and purchase another.  I know this seems like a drag to move after one or two years, but the trade off is that you get to purchase with the lowest rates available, you get to put less money down on the property and it is a legit way to build a portfolio.  

If you are up for it you could purchase a single family and rent out the rooms, if you don't want to share space you can find a small multi-family with two, three or up to four units and live in one while you rent out the others. 

This process will also give you experience in managing your properties. 

There are a lot of benefits to this process. Additionally, if your properties appreciate in value, you can leverage a heloc to gain more access to cash for additional investments. 

Let me know if you have any questions!

Patricia

[Steven Foster Wilson]

Quote from @David Rubin:

Hi

i'm starting out in real estate trying to buy my first properties but seeing the interest-rates going up keeps me still being 

what are the best options in the real estate market  even with high rate

please if you can help me out 

thanks 

md rubin

I think it all depends on the numbers and if you are patient to wait for that good deal. You should check out Columbus or Cincinnati. Your money will go very far, you'd be able to pick up a multifamily portfolio and start your cash flow. Not to mention Ohio is a landlord-friendly state.

[Mike Anderson]

Quote from @Karl B.:

"what are the best options in the real estate market even with high rate"

For those of us who have seen the writing on the wall, we've been stacking cash. In no time, interest rates will be up another 2-3 points and in most markets prices will fall, as will the level of competition. 

I agree with you. It's a math game at some point and people try to add emotion to numbers. Prices have to go down as interest rates go down. We are already seeing it.

[Lexey Vezzoso]

Hey David!

Now is the time to learn about Creative Finance. 

Look up Pace Morby on YouTube and you can learn a ton about it!

Let me know how else I can help.

Good Luck!

-Lexey 

[Vaughn Smith]

@David Rubin a solid deal can be found in most markets even with rates on the rise. Keep in mind rates are currently about where they were pre pandemic the increase in rates has been rapid, but don't let that deter you. If you find a solid deal now go for it, you can always refinance if rates decrease in the future (im assuming you're thinking about using a 30 year fixed rate loan)

[David Rubin]

Quote from @Vaughn Smith:

@David Rubin a solid deal can be found in most markets even with rates on the rise. Keep in mind rates are currently about where they were pre pandemic the increase in rates has been rapid, but don't let that deter you. If you find a solid deal now go for it, you can always refinance if rates decrease in the future (im assuming you're thinking about using a 30 year fixed rate loan)

 thanks for your help

what do you mean by a solid deal (if rates goes up eventually prices go down afterwards rental income goes down too?)

also is there a refinance penalty

if i may ask what do consider a solid deal ?

thanks

[Eliott Elias]

Seller financing is going to be key. Sellers don’t have the power right now, we as buyers have been waiting for this for a long time now. Time to capitalize 

[Chris Seveney]

Quote from @David Rubin:

Hi

i'm starting out in real estate trying to buy my first properties but seeing the interest-rates going up keeps me still being 

what are the best options in the real estate market  even with high rate

please if you can help me out 

thanks 

md rubin

 best options in real estate have never changed. Buy something you can afford in a great location and hold it long term. I have never found anyone to lose money long term on real estate in a good location. 

[Wale Lawal]

@David Rubin

When interest rates rise, mostly in periods of economic expansion, various asset classes react uniquely. Rising rates erode the principal of bonds, affect the value of stocks and other financial assets and influence interest payments on debt.

However, real estate investments have the characteristic of performing well in a rising rate environment. In particular, income-generating real property and multifamily have historically — and as I’ve witnessed from experience as an investor and developer — shown a greater ability to grow net income during expansionary periods than securities and other assets.

Owning real estate has a number of benefits during periods of high inflation. First of all, owners will see appreciation as property values keep pace with inflation. Also, with fewer real estate development projects due to rising labor, material, machinery and other costs, property supply slumps, leading to more price increases.

Second, inflation pushes all prices upward, rents included. As housing development slows and demand for existing properties rises, occupancy rates typically skyrocket. In such environments, landlords raise rents, which generates higher revenues (and increases property value) — as demonstrated by CoreLogic data, nationwide rents increased 10.2% year over year in September 2021.

Finally, mortgage payments on fixed-rate instruments do not change over time, i.e., the payments remain constant while equity growth accelerates. Furthermore, inflation reduces the value of money owed in the future.

Read this article for more information https://www.forbes.com/sites/f...

Good Luck!