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Rates on the move up? Track the 10 year treasury bill as it climbs higher and higher.

I’ve been licensed and a Realtor since 1978. Look at the chart below and you’ll see I spent 12 years wandering the desert of double digit interest rates. Also note that my first year was my last year of single digit interest rates for some time. How did I do? I was a top producer in my office all through the double digit storm. When we dropped under 10% it was cause for mass celebration in the Realtor ranks! I remember my fellow agents stating, “Man if we could get single digit interest rates we’ll tear this market wide open!” And we did.
Then notice it took almost 20 years to get down to the 4% range. If you’ve been in the business 5,10, 15, years you’ve KNOWN no other rates and experienced a historic low. Well, guess what boys and girls, rates DO go up, markets WILL go down, and recessions will come and go. Enjoy this while you can but remember to stack some cash aside, buy some investment properties with your big commissions today and prepare for the inevitable. I remember some of the infamous phrases used before the BIG BANG of 2007, “We’ll always have appreciation”, “We’ll refinance you out of this loan next year and pull cash out.” We all need to guard against, “Irrational Exuberance”. (thanks to Erik Oquist of Wells Fargo Home Mortgage for the graphics!)

You really didn’t think rates would stay down here forever-did you?

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