Interest Rates & The Numbers - Mark Jensen on Fundication Show
BRRRR it is getting cold in here. You bought a Fix n Flip at a 70% After Repair Value. Hard money quick close. You then fixed it tried to sell it but the market started to turn. So you kept it and went for the BRRRR method. Your $200,000 wholesale deal is now worth $300,000 at a 2.5% interest rate your payments are $1,197.00 on a 30 year loan.
So what is the problem why are you still underwater and not making it. Let me guess you are a short term rental type. There used to be 300 homes on airbnb at $197.00 a night and rented at 60% occupancy. However, with homes not selling more people tried to do short term rentals and rates dropped to $88.00 for a whole home.
$1,197.00 / $88.00 a night = 13.6 night to break even & we haven't even added in other risks yet. No one wants to work for free either.
This high-light gets into just that. Mark Jensen is an amazing human follow him on
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I think the interest rates need to stay higher for longer. If they do we solve homelessness but our kids can not afford homes and will live with their parents longer. 8:27 seconds in Julie Tallman asks the guru of numbers this question.
If we lower rates than inflation runs. Why because more people buy things. With 10,000 baby boomers a day retiring we just do not have the people to fill the orders of low cost of capital orders.
Check out the full episode on Here with out my edits.
Real Estate Trends & Affordable Housing with Mark Jensen | The Fundication Show #realestatepodcast
• Real Estate Trends & Affordable Housing wi...
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