From: Nigel W
Greetings All,
This is a question for those who were in the IP game during the heady days of 17% interest rates...
As I was just a mere lad in short pants at that time I'd like to hear from those who experienced that part of the cycle.
What happened to rents as the interest rates climbed to those stratospheric levels?
My guess is that there is a direct correlation between rental increases and interest rate rises.
My reasoning is that higher interest rates would:
a) force some people to sell up/distressed sales, pushing them onto the rental market ie an increase in DEMAND
b) dissuade the majority of investors from buying and thus causing a reduction in SUPPLY
(of course the smart/cashed up investors were probably picking over the distressed sale bargains...but I suspect there would not be enough of those to significantly impact the above)
I look forward to hearing from those with some more IP years under their belt.
Cheers
N.
Greetings All,
This is a question for those who were in the IP game during the heady days of 17% interest rates...
As I was just a mere lad in short pants at that time I'd like to hear from those who experienced that part of the cycle.
What happened to rents as the interest rates climbed to those stratospheric levels?
My guess is that there is a direct correlation between rental increases and interest rate rises.
My reasoning is that higher interest rates would:
a) force some people to sell up/distressed sales, pushing them onto the rental market ie an increase in DEMAND
b) dissuade the majority of investors from buying and thus causing a reduction in SUPPLY
(of course the smart/cashed up investors were probably picking over the distressed sale bargains...but I suspect there would not be enough of those to significantly impact the above)
I look forward to hearing from those with some more IP years under their belt.
Cheers
N.
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