Real Estate Myth: Rising interest rates means the prices will drop.

Real Estate Myth: Rising interest rates means the prices will drop.

Today's myth is rising interest rates means prices will drop. Is it true? Will the prices drop? Welcome to another episode of Myth vs The Truth.

So let's talk about it. Let's talk about the whole United States as a country, it might be, it might happen. But you know what, let's clarify. We are in South Florida. What happens in South Florida? Not only good weather, palm trees, coconut trees... paradise. We know that. We also know hurricanes come, but it doesn't matter. The main point is everyone wants to come to South Florida, as it's been famous for retirement. But not only that, let's talk immigration. A lot of people are coming in from different countries and where are they going? We have all the languages of the world in South Florida. We have Portuguese, we have Spanish a lot. And a large community from Creole to everything. All the flavors are here. Not only that, foreign investors, where they are going to come, have always been South Florida. So that is one of the reason we don't think the South Florida market will go down, even though interest rates bump up a little bit.

With all those people coming down to South Florida, where are they going to live? Look at the rental market. Rental markets today are so high, astronomically high. So it's either you rent and continue to pay the high rent or you purchase a property and you pay your own mortgage fixed for 30 years, your own property. 

Now get to the conclusion, even though the interest rate is rising a little bit or maybe a couple of points. So this population in South Florida, they are keep on going to buy more properties. There is no more land left. So we are expanding to the rural areas and people are going to, the families going to buy home because of those reasons, what Chantale and Sadie explained. And the market is going to keep on rising even though there is a little bit of a high interest rate. The rental market is super high and the rental market does not have a fixed rental compared to a fixed 30 year mortgage. The rent is going to keep on going up every single year.

Now, these are two very big reasons for Florida not to get affected with the rising interest rate. See you next week in another episode of Myth Vs the Truth.