TBT: Is It Wise to Buy Real Estate When Interest Rates are Rising?

In this Throwback Thursday episode of Passive Real Estate Investing, host Marco Santorelli revisits a timely and enduring question: Is it wise to buy real estate when interest rates are rising? Addressing concerns from listener John, Marco argues that rising mortgage rates should not deter investors, especially when they focus on fundamentals over timing. He emphasizes that real estate investing is about long-term wealth creation, not short-term market timing. Using historical data from Freddie Mac, Marco shows that current 30-year mortgage rates—around 6-7%—are still below the long-term average of 7.77% since 1971, and dramatically lower than peaks like 16.63% in 1981. He stresses that while rates may rise further in the near term, they are not permanent, and refinancing opportunities will likely return. Marco’s core message is that investors should focus on the right market, property, and team—what he calls the 'turnkey investment property' criteria—rather than waiting for perfect conditions. He warns against 'penny-wise, pound-foolish' behavior: delaying investment to wait for lower rates may cause missed opportunities in cash flow and appreciation. The episode concludes with a powerful reminder: real estate can thrive even in rising rate environments, especially as fewer buyers enter the market, increasing rental demand and investor advantage.