Increasing Interest Rates and affect on REI

[Mike Terry]

Hi Biggerpockets community. I am a rookie investor in Southwest Florida. I have a vacation rental that I have owned since the devastating real estate crash of 2009. We bought it because I knew that never again would you be able to buy a second home at that kind of discount and with extremely low interest rates. We were both mid career professionals with good incomes. We rented the home during the winter to snow birds to help cover the expenses. The value of the home has doubled, with the additional tax advantages it has served it purpose. Fast forward to last spring we both lost our jobs. Time to panic!!! We immediately sold our house in North Carolina and moved to our Florida vacation home. We have since invested the equity from the sale of our primary residence and bought a live in flip on the water that we are very pleased with. We both have decent jobs and we want to start building an REI business. We are going to turn the vacation rental into an annual rental that should cash flow 700$ a month. Ok sorry that was a long preface. The discussion I would like to start is centered around interest rates and the future of the housing market. I am ready to sink our retirement funds about 600k into this business so of course we want to be careful. I read this article by Wolf Richter on his blog and it has given me some pause. Please read and let’s start a discussion any input would appreciated. https://wolfstreet.com/2018/04/25/what-will-these-mortgage-rates-do-to-housing-bubble-2/

[Charlie DiLisio]

I do mostly flips myself and Palm Beach County prices have gone up considerably which makes it hard to find good deals to flip.  I think lots of people are trying to cash in on their property.  Interest rates are helping to sell because of the lower payments but if they start going up less people will be able to qualify.  Have considered investing out of state but just my two cents.