Home › Forums › Housing › 4% 30 Year Mortgage › Interest rates are headed
Interest rates are headed back down.
Already, real interest rates are -3% (7% inflation 4% mortgage).
Inflation is probably headed back down in a year or two. We’ll be back to 1.5-3% inflation and 2.5-3% rates.
But while inflation itself can be hard to predict, real interest rates are easier.
Rich people have more and more money they want to invest rather than purchase consumption items.
The pool of creditworthy borrowers, however, is in permanent demographic decline.
Places like Germany and Japan, where demographic decline is more advanced than the USA, have had deeply negative real rates for a long time.
