>>Furthermore, there is little hope that interest rates will do anything but go up in the near term.
I see you are smarter than the collective intelligence of Wall Street and the rest of the investment world, which is pretty certain than interest rates are NOT going up anytime soon, which is why the rate in 30 year bonds is LOWER than the overnight rate. With this ability to outsmart the rest of the investing world, you will soon be a billionaire via shorting long-term zero-coupon treasuries.
>Certainly, if you can make more on the bank’s money than your after-tax cost of borrowing it then paying off your mortgage early doesn’t make sense. I just don’t see how that can be done in this RE climate.
Very easy. Plenty of cash-flowing properties in Texas, Michigan, upstate New York, just to cite a few examples. I won’t say it’s easy work. Broken down houses that need rehabbing in crummy neighborhoods with troublesome tenants. Been there, done that, don’t want to do it again. But for some enterprising young person who wants to make their fortune, there gold in this sort of thing. There is no housing bubble in most of the country.
Now I admit, the book is taking advantage of the current real-estate mania and most people are not cut out to be part-time RE investors. In fact, many people are not cut out to be owners of real-estate period. But for a significant fraction of the population, part-time and eventually full-time landlording is and always has been the easiest way to get rich in this country, precisely because of the possibilities of leverage. There is another group of people who are cut out to run other types of businesses than real-estate, and for these people, it makes sense to borrow money using a home mortgage, at a low rate, rather than trying to get a bank business loan at much higher rate.
