Mortgage Rates Around 6.69% — How Are You Stress-Testing Deals Right Now?

With the 30-year fixed mortgage rate around 6.69%, I’ve been thinking about something that matters more than simply whether rates are “high” or “low.”

How much room for error does the average rental deal have right now?

Take a property that appears to work based on:

$2,800/month projected rent
5% vacancy
Expected operating expenses
A reasonable repair budget
Today’s financing
A future refinance at a better rate

The spreadsheet might look good.

But change a few assumptions:

Rent comes in at $2,650 instead of $2,800.

Insurance is higher than expected.

Repairs run $8,000 over budget.

Vacancy lasts longer.

The future refinance doesn’t happen at the rate you expected.

Suddenly, you’re analyzing a very different investment.

That’s why I’ve become increasingly interested in the difference between analyzing a deal and stress-testing a deal.

Instead of only asking:

“Does this property cash flow?”

I’m asking:

“How wrong can I be before this property stops working?”

For example:

• What happens with 5–10% lower rent?
• What happens with 10–15% higher expenses?
• What happens if financing remains expensive?
• What happens if the exit value disappoints?
• What happens when two or three of those occur simultaneously?

I think that last question is particularly important in today’s market.

A deal that works only when every assumption is correct isn’t necessarily a good deal. It may simply be a fragile one.

This thinking is also part of why I’m building CDealAnalyzer. The goal is to give investors a deterministic way to underwrite and pressure-test deals before committing capital.

But I’m interested in how other investors are approaching this.

What assumption are you stress-testing most aggressively right now — rent, expenses, interest rates, vacancy, or exit value?

And how much downside do you require a deal to survive before you’re comfortable buying?

The deal is not the risk. Being wrong about the deal is.