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0 pointsPaulRobinson9y ago0 comments

You don't say where you are based, but you are going to get a shock if you think interest rates are going to stay on the floor. If you can get a genuine 25-year fixed rate, great, but you need to tread carefully here.

Brexit, Trump, EU sentiment, China trying to deal with their own problems, they're all pointing to the same way: devalued currencies. Where they start, rising interest start to follow.

I'd also be wary of assuming commercial real estate was a lock-in. I've heard horror stories.

I'm glad it's working for you right now, I'm just saying: make sure you tread carefully and have done your research before you start gearing up.

0 comments

antr9y ago

The all-in fixed rate is 2.10%, and let me repeat: fixed. Not LIBOR + spread + you need to have you savings account with us + you need to buy my home insurance, etc.

I don't understand why you say "tread carefully"... when it's the bank bearing all the IRS cost. Plot any LIBOR curve, and you'll see that the bank is the one to lose here. Banks are fighting for customers, and cheap loans and mortgages is the game they are playing. I could go into more detail, but given that I have a 12 month DSRA account in place, I'm quite happy with the investment.

cylinder9y ago

I don't believe we'll see high rates in our lifetimes. The broad trends in developed countries are all deflationary.

brianwawok9y ago

Don't you lose if you can't find Tennant's for your property? Or do you plan to just go bankrupt if that happens?

antr9y ago

  > but given that I have a 12 month DSRA account in place, I'm quite happy with the investment.

1 more reply

lowpro9y ago

This isn't necessarily true. The US dollar is actually increasing in value as people want their money to be safe. If Trump does bring back American jobs, meaning less jobs in Asia, the dollar buy will continue, depressing Asia and strengthening the US for now.

But you're right, the OP definitely needs to tread lightly with property and the contracts. The devil is always in the details.

threeseed9y ago

The unemployment rate in the US is 4.9% which is basically full employment.

Now sure there are a number of people who don't report and those who wish to work more. But I don't think it's going to be easy to get those people back into work. Most are either in industries that are disappearing due to automation. Or they lack the skills/training to re-educate themselves.

And without tariffs (which will impact exports) there is little chance of US being all that competitive in most industries that compete with Asia (I assume you actually mean China).

bb6119y ago

Unemployment is only 4.9% because the participation rate dropped 3% points in the last 10 years: http://data.bls.gov/timeseries/LNS11300000

That's close to 10 million people who have stopped looking for jobs who we would otherwise expect to have them.

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FrancoDiaz9y ago

4.9% isn't even close to being the real unemployment rate.

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5511999y ago

You want to look into participation rate. Compare participation and unemployment rate over time and it's clear '4.9%' is pure fallacy.

bigboris9y ago

Roughly 100 million people in the US are out of work or no longer looking for work. That's approx a third of the population. "4.9% is basically full employment" is a terribly naive statement. The trend clearly shows things getting worse, not better.

https://fred.stlouisfed.org/graph/?g=4CRu

j / k navigate · click thread line to collapse

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antr9y ago

The all-in fixed rate is 2.10%, and let me repeat: fixed. Not LIBOR + spread + you need to have you savings account with us + you need to buy my home insurance, etc.

cylinder9y ago

I don't believe we'll see high rates in our lifetimes. The broad trends in developed countries are all deflationary.

brianwawok9y ago

Don't you lose if you can't find Tennant's for your property? Or do you plan to just go bankrupt if that happens?

antr9y ago

  > but given that I have a 12 month DSRA account in place, I'm quite happy with the investment.

1 more reply

lowpro9y ago

But you're right, the OP definitely needs to tread lightly with property and the contracts. The devil is always in the details.

threeseed9y ago

The unemployment rate in the US is 4.9% which is basically full employment.

And without tariffs (which will impact exports) there is little chance of US being all that competitive in most industries that compete with Asia (I assume you actually mean China).

bb6119y ago

Unemployment is only 4.9% because the participation rate dropped 3% points in the last 10 years: http://data.bls.gov/timeseries/LNS11300000

That's close to 10 million people who have stopped looking for jobs who we would otherwise expect to have them.

2 more replies

FrancoDiaz9y ago

4.9% isn't even close to being the real unemployment rate.

1 more reply

5511999y ago

You want to look into participation rate. Compare participation and unemployment rate over time and it's clear '4.9%' is pure fallacy.

bigboris9y ago

https://fred.stlouisfed.org/graph/?g=4CRu

j / k navigate · click thread line to collapse