The failures of SVB and Credit Suisse Banks have left investors feeling confused about how to interpret the market and recent economic news. This video explains what the market turmoil means to you if you’re a real estate investor and how you can take advantage pf the changing environment.

Get started here:

0:00 Banking system failure
0:35 Inflation
1:25 Emergency help from Federal Reserve
2:16 Betting against a rate hike
3:22 Time to invest in Real Estate
3:58 Go!

Nicole Purvy is a toddler mom, author, TEDx speaker, real estate entrepreneur and the CEO of the Better Than Success Real Estate League.

Nicole is also the founder of Philly Real Estate Week and WIRE (Women in Real Estate Summit).

Although Nicole resides in LA, she continues to invest remotely in Philly. She is also a partner of BTS Funding

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The Better Than Success Real Estate League is the The World’s Most Comprehensive and Robust Real Estate Club for first-generation entrepreneurs, investors and wealth builders. With the leadership of our 12 BTS Certified Real Estate Executives, we guide our member-investors through our unique engineered psychology-based approach that has been proven to help:

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Inflation, Interest Rates, Bank Failures, and Real Estate Investing Explained

In the realm of economics, there are several crucial factors that play a significant role in shaping the financial landscape. Amongst these factors, inflation, interest rates, bank failures, and real estate investing hold utmost importance. Understanding these concepts is essential for anyone involved in the financial world or even for those looking to make informed investment decisions. In this article, we will explore these topics in depth and explain their interconnections.

Let’s start with inflation. Simply put, inflation refers to the sustained increase in the general price level of goods and services over time. When inflation is high, each unit of currency buys fewer goods and services, leading to a decrease in the purchasing power of money. This can be attributed to various factors such as increased production costs, a surge in demand, or excessive monetary growth. Central banks and policymakers often aim to keep inflation at a moderate and stable level to maintain a healthy economic environment.

One tool used by central banks to control inflation is the management of interest rates. Interest rates are the cost of borrowing money or the return on investment provided by financial institutions. When inflation is high, central banks might opt to increase interest rates to curb excessive spending and investing. This increase in interest rates makes borrowing more expensive, thus encouraging people to save money instead of spending it. On the other hand, during times of low inflation, central banks may lower interest rates to stimulate borrowing and spending, effectively boosting economic activity.

While interest rates can influence inflation, they also have implications for the banking industry. Banks play a vital role in the economy by accepting deposits from individuals and lending money to individuals and businesses. When interest rates increase, borrowing becomes more expensive, and this can have a negative impact on banks. Individuals and businesses may be less likely to take out loans, leading to a decrease in bank profitability. In extreme cases, high interest rates combined with economic downturns can contribute to a rise in bank failures.

Now, let’s segue into real estate investing. Real estate investment involves purchasing, owning, managing, and selling properties to generate a return on investment. Real estate, including residential, commercial, and industrial properties, has long been considered a stable and potentially lucrative investment option. However, various factors, including inflation, interest rates, and the overall health of the economy, can significantly impact real estate investments.

Inflation can affect real estate investments both positively and negatively. On one hand, during times of inflation, the value of properties may increase, which can be beneficial for real estate investors. Additionally, rental incomes tend to rise with inflation, providing investors with higher cash flows. However, inflation can also lead to increased construction costs and higher mortgage interest rates, making real estate investments more expensive in the long run.

Interest rates also bear considerable influence on real estate investing. When interest rates are low, it becomes cheaper to finance real estate purchases. Lower borrowing costs incentivize investors to take on more debt and invest in properties. Conversely, high interest rates can deter investors from entering the market or expanding their real estate portfolios. This dynamic relationship between interest rates and real estate investing highlights the importance of monitoring the prevailing interest rate environment when making investment decisions.

Moreover, bank failures can impact real estate investors indirectly. When banks fail, it can create financial instability within the economy. This instability can lead to reduced lending and tighter credit conditions, making it more challenging for investors to obtain financing for real estate projects. Additionally, the overall economic downturn resulting from bank failures can lead to decreased property demand and lower property values.

In conclusion, inflation, interest rates, bank failures, and real estate investing are interconnected elements of the financial landscape. Inflation influences interest rates, which, in turn, impact the banking sector and real estate investments. Understanding these concepts and their interplay is crucial for investors to make informed decisions, manage risks, and optimize their investment returns.