Investors like when rates go upFor Investors
Why do some real estate investors like it when rates go up?
It’s pretty simple.
When the rate goes up, so does the rent.
In that case, we all have two options:
- we can either rent
- or we can buy real estate.
Well, there’s a third option if you want to go back to live with your parents.
Simply put, if the buyer decides not to buy in this market (for example, the client thinks that rates are rising and is not sure about the future), he needs to rent.
Investors understand this and raise the price of rent, because this person has nowhere else to go. He is afraid to buy, so he will rent for an indefinite period, and this is beneficial for the investor.
So remember, we all pay mortgages.
But we can pay either for ourselves or for someone else.