Overview of Mini Episode
Craig Fuhr and Jack BeVier discuss the state of DSCR rates in real estate. Many investors remain on the sidelines, waiting for interest rate cuts. They expected these cuts after the Fed’s recent decision on September 18th. However, the five-year bond rate has risen since then.
Market Reactions to DSCR Rates
Jack explains that while short-term rates decrease, long-term rates, such as five-year bonds, may not follow. Consequently, this inconsistency keeps many potential investors hesitant. Investors should act now, rather than wait for possibly unfavorable conditions.
Activity Levels in the Market
Despite lower mortgage rates, showing activity remains sluggish. Jack worries that investors dropping prices may waste money. Instead, they should pivot to rental properties. This strategy allows for cash flow and future buying opportunities.
Understanding Bond Market Dynamics
Craig notes recent increases in bond rates amid political uncertainty and rising national debt. He argues against relying on returning to 2021’s low rates. Therefore, investors need to take action now, even with rising rates.
Final Recommendations on DSCR Rates
Both hosts conclude that investors should stop waiting. They emphasize proactive strategies, such as refinancing and adjusting investment approaches, to navigate the current market effectively. By focusing on DSCR rates, investors can better position themselves for future opportunities.
