0:18

In this short market commentary, the speaker warns that underwriting real‑estate deals assuming a 4% borrowing cost is no longer realistic. Investors should now model a 5% rate on a 10‑year loan and anticipate mortgage rates approaching 7%. With rent growth expected to be only about 2% annually, the higher financing costs will erode equity unless investors first focus on cutting operating expenses. The message is a call to adjust financial assumptions and prioritize expense control to protect returns.

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