Login | Join Our FREE VIP Investor Group

REALTY411Guide.com

Serving the Real Estate Industry Since 2007

Real Loans

Are Lower Rates on the Horizon?

By

By Rick Tobin

Almost every housing boom and bust cycle over the past 100 years was directly related to access to third-party money sources. When rates are low and the loan approval process is more flexible, home values tend to be high. Conversely, higher rates and tighter loan approval processes usually make home prices stagnant or declining.

The average 30-year fixed rate over the past 50 years was about 7.7%, which is actually much higher than today’s 30-year fixed rate average that is about 1% lower as of the first week in August 2025.

The peak high 30-year fixed rate over the past 50 years reached 18.63% in October 1981, while the low rate average fell to 2.65% in January 2021.

On August 7, 2025, the 30-year fixed rate fell to a 6.63% rate average, as per Freddie Mac and the NAR. This was the lowest 30-year fixed rate average in about 10 months dating back to October 2024.

article continues after advertisement

The Fed’s Next Move

The next three scheduled two-day Federal Open Market Committee meetings held by the Federal Reserve in 2025, where interest rate directions will be discussed, will be on these dates:
● September 16-17
● October 28-29
● December 9-10

The FedWatch Tool, which is managed by the Chicago Mercantile Exchange (CME), now forecasts a 94.4% chance of a rate cut at the next Federal Reserve meeting to be held on September 16 and 17. This is partly due to a combination of weakening and revised past jobs reports, rising consumer debts and delinquencies, and increasing risks of future inflation trends.

On August 1, 2025, voting members like Federal Reserve Governor Lisa Cook shared that the recently revised jobs report from the Bureau of Labor Statistics (BLS) was a bit “concerning” to several Fed members. The BLS had provided a downward revision of its May and June payroll figures by a combined 258,000 jobs, which was the largest jobs reporting correction since 1968.

Back at the previous Fed meeting in July 2025, the Federal Open Market Committee (FOMC) decided to keep interest rates unchanged and within the 4.25% to 4.5% rate range. By early August 2025, the future near term probability of a rate cut skyrocketed to a 94.4% chance of at least a 0.25% rate cut and only a 5.6% chance of no rate cut at the next September meeting.

Some financial analysts believe that the Fed may be inspired to start cutting rates as much as 0.5% at a time and/or will continue cutting rates at the final three scheduled Fed meetings here in 2025 if the U.S. economy is seen as weakening more so than strengthening. This is partly due to the fact that the Fed is usually just as concerned about unemployment trends as they are about core inflation numbers.

Rising Home Inventory Numbers

Has there ever been a time when there is so much contradictory published data about real estate trends that can be viewed as both positive and negative at the exact same time as most metropolitan regions hit all-time record price highs?

There were 4,000,000 homes listed for sale as active inventory in 2007. Here in 2025, there are approximately 1,500,000 homes listed for sale. However, there are also 45 million more people across the nation today.

The vacant and distressed shadow inventory supply of U.S. homes absolutely dwarfs the national home listing inventory supply by a significant multitude. A recent study conducted by the Federal Reserve Bank of New York found that the average redefault rate over 12 months after a previous loan modification approval for a subprime mortgage-like mortgage was 56%.

Many homeowners have been able to keep modifying their delinquent mortgages for more than four years without making one payment. At some point, lenders and loan servicing companies will start filing foreclosure on a larger scale and the national home listing inventory supply will start to rapidly rise.

There were 500,000+ more U.S. home sellers than buyers in June 2025. How will these number trends look later this fall and winter?

The Declining Dollar

The US dollar has lost more than 28% of its purchasing power since 2020, as per the Truflation US Aggregate Inflation Index. Sadly, the purchasing power is declining at a faster pace now by falling somewhere between 10% and 11% through just the first seven months of 2025.

The M1 money supply (cash or cash-like instruments) went from $4 trillion in January 2020 to $20 trillion just 22 months later in October 2021. The more money in circulation, the less the purchasing power.

Upwards of nearly 1/3 of your savings has been severely damaged in half a decade between 2020 and 2025. Inflation is also akin to a hidden form of taxation.

The imploding value of the dollar over the past 50 years is a major factor why home prices have skyrocketed well above the annual published inflation rates. Historically, homes have been an exceptional hedge against inflation. Fifty years ago, $1 had the same purchasing power as 7 cents today here in 2025.

Real estate, however, is usually an exceptional hedge against inflation as homes have historically increased in value at least more than double the published inflation rates over the past 50 years.

article continues after advertisement

Interest Rate & Home Value Directions

Home values and interest rate trends are usually inverse to one another. When rates are low, home price directions are likely to rise. Conversely, rising rates can cause home values to fall. The 30-year fixed mortgage rates are tied directly to the 10-year Treasury yield, which is inverse to price and demand, while the Federal Funds Effective Rate impacts short-term consumer loans more. Many times, these different rates rise and fall together.

Even if the Fed pivots and starts aggressively slashing rates, a housing bottom tends to take somewhere between 24 and 48 months on average following a Federal Reserve rate cutting campaign such as the rate cuts after the 17 separate rate hikes between June 2004 and June 2006. From 2008 to 2015 when rates were near zero, it took upwards of seven years for some housing regions to rebound following the final June 2006 rate cut.

Record Home Equity and Locked-In Owners

U.S homeowners are now sitting on almost $35 trillion in net equity with or without existing mortgages in place. For homeowners who are locked in with sub-5% 30-year fixed mortgage rates, they may be hesitant to sell and lose these 5%, 4%, or 3% fixed rates.

For others (California homeowners, especially) who have built up equity far greater than the primary home sale capital gain exemption amounts ($250,000 for individuals and up to $500,000 for married couples filing jointly), they may be reluctant to sell and pay capital gains taxes on amounts over and above these maximum capital gains tax exclusion numbers.

In past housing downturns, the key factors that caused the price drops included:

* Rising home listing inventory (the distressed “shadow inventory” continues to be artificially suppressed and slowly released)

* Increasing unemployment numbers (the true unemployment rates are much higher than the published government data as I’ve said for decades)

* Rising foreclosures that later became neighboring home sales comps which, in turn, may drive down the non-distressed home values as well.

* Increasing “upside-down” or “underwater” homes where the mortgage debt exceeds the current market value. In California, it’s easier to walk away from a purchase money mortgage (the rules change, however, once you refinance your original California purchase loan) because the lender cannot pursue you for any financial losses and obtain a deficiency judgment like in other states like Texas.

* Unaffordable mortgage payments

What about long-term rate directions?

Please keep your eyes squarely focused on the next few Fed meeting decisions as well as the direction of the 10-year Treasury yield, which is a direct catalyst for the 30-year fixed mortgage rate directions.

Even if the Fed takes short term rates down to near zero again like in past years, the 10-year Treasury yield may still increase due to factors such as fewer foreign buyers for our Treasury bonds, rising federal debt, and future credit downgrades by credit rating agencies such as Moody’s, Standard & Poor’s, and Fitch.

The potential for any future credit rating downgrades for our federal debt may, in turn, drive bond prices downward and 10-year Treasury yields and corresponding 30-year fixed mortgage rates higher.

Money is needed to get you into and out of your real estate properties whether it originates from a mortgage broker, bank, equity fund, or your savings account. The more affordable the access to cash, the more likely that home values may rise rather than fall in either the short or long term.

We shall see what happens with future rate and home value trends. While there are no guarantees for real estate and life in general, the only constant in life, and also for rates, is change.

Rick Tobin

Rick Tobin has worked in the real estate, financial, investment, and writing fields for the past 30+ years. He’s held eight (8) different real estate, securities, and mortgage brokerage licenses to date and is a graduate of the University of Southern California. He provides creative residential and commercial mortgage solutions for clients across the nation. He’s also written college textbooks and real estate licensing courses in most states for the two largest real estate publishers in the nation; the oldest real estate school in California; and the first online real estate school in California. Please visit his website at Realloans.com for financing options and his new investment group at So-Cal Real Estate Investors for more details. 

Learn live and in real-time with Realty411. Be sure to register for our next virtual and in-person events. For all the details, please visit Realty411.com or our Eventbrite landing page, CLICK HERE.

The Interplay of Medical, Insurance, and Housing Financial Burdens

By

By Rick Tobin

For many American homeowners, the bulk of their net worth is created by the long-term equity creation in their primary home. Later in life, the home wealth may be used as a way to pay for medical expenses for the homeowners or other family members whether or not they have sufficient amounts of medical or life insurance benefits.

Here in 2025, the big three monthly expenses for a high percentage of Americans are medical, insurance, and housing costs for both owners and renters. Today, these big three costs are all at or near all-time record highs. As a result, this combination of so many unaffordable expenses are financially draining for more people and it’s incredibly challenging to set aside cash reserves.

article continues after advertisement

The #1 cause of financial insolvency and bankruptcy filings here in the U.S. is directly related to unpaid medical bills. Some past surveys found that upwards of 80% of those Americans who were forced to file for bankruptcy due primarily to medical bills did, in fact, have medical insurance coverage in place at the time.

Sadly, the medical insurance coverage wasn’t high enough to cover the medical bills and/or the cash payment deductibles required to pay these bills weren’t achievable for many cash-strapped medical patients or their families.

Debt, Divorce, and Home Listings

The #2 cause of financial insolvency for Americans is due to divorce which, in turn, is most likely associated with financial stress between the once loving married couple. Oftentimes, the unpaid medical bills for one or both spouses were the major financial strain that led to both significant money pressures and the subsequent divorce, tragically.

Here are marriage, family, and divorce trends that I’ve compiled and shared over the years in articles and books as it partly relates to the most important family word that’s located right in the middle of the “single-family home” description:

Marriage and Divorce Trends

* The overall divorce rate in Orange County, CA is 72%; it’s 60% in California; and 50%+ nationwide.
* 41% of first marriages end in divorce, 60% of second marriages end in divorce, and 73% of third marriages end in divorce.
* The average length of a marriage in the U.S. that ends in divorce is 8 years from start to finish.
* Couples who spent more than $20,000 on their wedding were 3.5 times more likely to divorce than those who spent between $5,000 and $10,000, as per Emory University.
* Unmarried parents who live together are more likely to break up than married parents, per the Brookings Institute.
* Since 1990, divorce rates for people over 50 have doubled; they’ve tripled for people over 65.
* The U.S. now has the highest percentage of single-person households in the world and lowest marriage rates ever.
* U.S. fertility rates are the lowest ever, as fewer babies are born.
* USA is #1 for highest teen pregnancy rate in the industrialized world.
* Approximately 50% of children are born to unmarried women under 30 here in the USA.

These ongoing declining marriage and family trends will likely negatively impact future single-family home trends at some point in the future.

The divorce then inspires the homeowners to sell their family home to pay off both the unpaid medical bills and the rising legal costs associated with the ongoing divorce and unpaid collections related to the medical bills.

There are more than 1.2 million spouses involved in a divorce nationwide each year, as per sources like the CDC. Roughly 61% of all divorcees involved in a divorce end up listing their primary family home which, in turn, works out to more than 732,000 home listings per year that are as a result of divorce, per sources like Smart Agents.

Because there’s an epidemic of skyrocketing unpaid medical bills, financial insolvency, and subsequent divorces, there’s an increasing number of real estate agents who focus on divorce listings for homeowners who really have very few options but to sell their beloved family homes to pay off their expenses.

Medical Debt, Insufficient Insurance & Bankruptcy

An estimated 100 million Americans owe more than $220 billion dollars in medical bills despite the passage of the Affordable Care Act (ACA) back in 2010.

Approximately two-thirds, or a rather devilish 66.6% of Americans, who file Chapter 7 (complete liquidation) or Chapter 13 (bankruptcy payment plan over a few years) bankruptcy do so primarily due to unpaid medical bills, according to sources like SmartFinancial. As per this same medical bill and bankruptcy analysis, it’s equivalent to 550,000 people each year who file for medical bill-related bankruptcy protection even though 80% of these same indebted consumers had health insurance coverage at the time of their bankruptcy filing.

There are many more U.S. consumers who have unpaid medical bills who don’t file for bankruptcy protection than those people who do file for bankruptcy by a factor of more than 30-to-1.

article continues after advertisement

For example, upwards of 14 million people, which is about 6% of American adults, owe more than $1,000 in unpaid medical bills. Additionally, another three million Americans owe more than $10,000 in medical bills. If true, this works out to 17 million Americans with unpaid medical debt as compared to 550,000 Americans who file for bankruptcy each year due partly to medical debt at a ratio of more than 30-to-1.

These unpaid medical bills can later end up as collection accounts with more aggressive debt collectors who may report the debt on a consumer’s credit report. If so, the declining credit scores for certain consumers can make it very challenging to qualify for various types of consumer loans such as for credit cards, automobile, business, and mortgage loans.

Homeowners who have too much wealth to file for bankruptcy protection from unpaid medical bills do have several ways to pull cash out of their home or investment properties as I’ve shared in past articles such as How to Leverage Real Estate to Reduce Medical Debt.

Is insurance the new “mortgage” payment?

An increasing number of Americans may pay more for medical insurance each month than they do for housing expenses as either a homeowner or tenant. For others, they may pay more each month for homeowners or landlord insurance premiums than they do for mortgage or rent payments, especially in certain high-risk insurance regions like Florida and California.

Past articles from sources like the New York Times have described health care insurance payments as the “new mortgage” for many homeowners who are now struggling to pay their medical bills, insurance, and housing costs in addition to other regular bills like groceries.

In this linked New York Times article entitled How the High Cost of Medical Care is Affecting Americans (December 18, 2024 publishing date), two shockingly high medical bill examples in that article were as follows:

* A bill of over $40,000 for the 20 minutes it took for a doctor to stitch a cut.
* An ambulance ride of just 200 feet cost $3,421.

Younger married couples may pay more for monthly child care than they do for their monthly housing costs. If so, these rising costs for parents who want one or more children may not be financially practical for them, sadly. This is one major reason why U.S. fertility rates are now at all-time record lows.

In many high-risk flood, storm, or fire regions, the monthly homeowners or landlord insurance premiums might’ve increased somewhere between 25% and up to as high as 1,000% in recent years. As a result, the monthly insurance premiums may be much higher than the mortgage payment as I’ve shared in recent articles such as The Drying Disaster-Relief Insurance Pools.

The Housing and Insurance Umbrella Protection

The greatest form of wealth is good health and happiness. We should all focus, first and foremost, on being as healthy as possible. Otherwise, the outrageously expensive medical bills and rising out-of-pocket deductible cash payment requirements can be financially devastating.

The insurance, real estate, mortgage, and medical sectors are all tied together in many ways with money being the root link between them. We all need sufficient amounts of insurance protection to protect us from any potential known or unknown future risks for both our properties and our bodies.

If someone doesn’t have enough insurance protection in place for medical expenses and/or housing, then he or she might end up penniless and in bankruptcy court.

Again, you’re more likely than not to create the vast majority of your overall net worth from the equity gained in the ownership of your primary home. However, you’re also likely to end up broke by future unpaid medical bills that may or may not be paid 100% by your insurance carrier if you’re fortunate enough to have any medical insurance at the time of the medical billing.

It’s generally very wise to reach out to your most trusted insurance, real estate, and mortgage advisors to assist you with the most creative, affordable, and safest combinations of financial planning that can keep you and your family protected like a sturdy umbrella in an approaching dark and destructive rainstorm.

Rick Tobin

Rick Tobin has worked in the real estate, financial, investment, and writing fields for the past 30+ years. He’s held eight (8) different real estate, securities, and mortgage brokerage licenses to date and is a graduate of the University of Southern California. He provides creative residential and commercial mortgage solutions for clients across the nation. He’s also written college textbooks and real estate licensing courses in most states for the two largest real estate publishers in the nation; the oldest real estate school in California; and the first online real estate school in California. Please visit his website at Realloans.com for financing options and his new investment group at So-Cal Real Estate Investors for more details. 

Learn live and in real-time with Realty411. Be sure to register for our next virtual and in-person events. For all the details, please visit Realty411.com or our Eventbrite landing page, CLICK HERE.

Why Are Home Inventory and Prices Both Increasing?

By

By Rick Tobin

California just reached an all-time record median home price peak of $910,160 in April 2025, as per the California Association of Realtors. This new record state price number was more than $500,000 above the national median home price in the same month. 

How much longer will home prices keep rising and home listing inventory numbers remain below historical norms, both here in California and across the nation?

In April 2025, the estimated days on market (DOM) statewide for California was listed as being as low as 31 median days on market by Redfin. The very low days on market listing number is a key factor why California home prices just surpassed all-time record highs.

By comparison, the median number of days a home spent on market in May 2025 as a listing in the U.S. reached 51 days, according to the Federal Reserve Bank of St. Louis. The median list price for U.S. home listings was $431,250 for May.

During the depths of the previous housing meltdown in California back in 2010, the median days on market was listed as 57.5 days as per the California Association of Realtors. However, the average days on market statewide for 2010 listings was listed by other sources as much longer at nearly 140 days, partly since it took several years for some listings to sell.

article continues after advertisement

California’s active home listing supply is lower today than back in 2019. Ten states are now back above pre-pandemic 2019 active housing inventory levels:         

Arizona
Colorado   
Florida 
Idaho
Hawaii
Oregon
Tennessee   
Texas
Utah
Washington

Source: ResiClub

The main exception to the low days on market rule for California home listing inventory is found in some higher price luxury home regions. For example: “San Diego County homes costing $6 million and up are taking an average 633 days to sell,” as per the San Diego Union Tribune.

All-Time Record High Listing Values

The U.S. housing market now has 500,000 more home sellers than homebuyers. What about the huge supply of distressed homes that have been in forbearance as far back as 2020? When will a larger percentage of this “shadow inventory” be added to the national home listing inventory?

After adding up another few trillion in commercial real estate listings, the combined listing values for all real estate property types do really reach all-time record highs.

There are now almost $700 billion dollars’ worth of home listings for sale in the United States, which is a new record since Redfin began tracking this data in 2012. This same study found that the total combined value of homes for sale is up +20.3% from last year.

The total number of growing listing inventory for homes for sale nationwide also had a year-over-year increase of +16.7% in April 2025, as per Redfin and NBC. However, home-sale prices still rose +1.4% over the period of 12 months by April 2025.

Please note that since home values in most metropolitan regions across the nation are likely to be at or near all-time record highs, this all-time combined record home listing number is not necessarily all negative. It just partly means that home values are much higher in 2025 than in years past.

Stale Listings and Canceled Purchase Contracts

The total “stale inventory” number (or 60+ days on the market) for U.S. home listings reached 44% of all home listings in April 2025. This was +42.1% higher than the previous year and the highest April percentage since 2020 following the pandemic declaration a few weeks prior.

There were approximately 56,000 home-purchase contracts that were canceled in April 2025 across the nation, which equals 14.3% (or 1-in-7 purchase deals) of all homes under contract for that same month.

Florida had five of the 10 metropolitan regions in the nation with the highest purchase contract cancellation rates in April 2025, as per Redfin and Newsweek.

The Top 10 Purchase Cancellation Rate Regions

1. Atlanta, GA: 20%+

2. Orlando, FL: 19.4%

3. Tampa, FL: 19.1%

4. Riverside, CA: 19.1%

5. Miami, FL: 18.9%

6. Ft. Lauderdale, FL: 18.9%

7. Ft. Worth, TX: 18.7%

8. Las Vegas, NV: 18.6%

9. Jacksonville, FL: 18.4%

10. San Antonio, TX: 18.2%

All four of the states (Florida, Georgia, California, and Texas) included in this Top 10 cancellation rate percentage list have challenging homeowners insurance issues related to both availability and rising costs.

Other factors for home purchase cancellations include rising mortgage costs and loan denial rates. A larger number of mortgage applicants these days are having to switch from conventional mortgages to non-QM or private money to qualify to purchase homes because their credit scores may be dropping and/or their debt-to-income (DTI) ratios are rising too high and exceeding 40% or 50% DTI ratios.

Real Inflation is Much Higher

Why does “real world” inflation seem significantly higher than published government inflation rates? Are your asset investments booming and/or is the purchasing power of your dollar busting?

How often do you go to a fast food restaurant and spend more than $20 per person? Can you fill up less than half of your grocery cart for less than $200 where you shop?

Between 2000 and 2025, let’s take a closer look at some of my price increase percentage estimates for homes, education, and automobiles:

* Home prices: Up 3 to 5 times in many markets.
* College tuition: Up 2 to 4 times at many schools.
* Car prices: Up 2 to 3 times for numerous car models.

When I see the federal government’s published annual inflation data that’s closer to 2% to 4%, I wonder where these economists shop. Am I shopping at the wrong stores and paying prices that seem to be more than 10% higher than last year or is the published government data not all that accurate?

Record Consumer and Government Debt

More than 12% of outstanding credit card balances are 90 days delinquent, which is the highest percentage since 2011. Delinquent student loans (in red) are rapidly rising to almost 8% as well as of the first quarter of 2025.

The Federal Reserve conducted a survey recently and asked a large pool of U.S. consumers if they had $2,000 in cash savings to cover an unexpected emergency expense using only their savings and not any credit cards.

The Fed’s survey results were as follows:

  • 52% of U.S. consumer respondents could not cover a $2,000 emergency expense using only their cash savings.
  • 31% of surveyed consumers could not cover a $500 cash expense.
  • A record 37% of respondents described inflation as their #1 primary financial challenge.

In the first quarter of 2025, the federal debt was increasing in size by about $1 trillion every 100 days.The U.S. dollar has now lost almost 9% of its value this year, according to Barchart.

In 2024, world governments issued more debt than ever before. For example, sovereign bond issuance across the planet reached a record $18 trillion dollars in 2024, as per the Kobeissi Letter. Approximately $16 trillion was issued by developed countries like the United States, and $2 trillion by emerging market economies.

The total world government bond issuance has nearly doubled since 2019. Over the past five years, governments have issued more debt worldwide than in the eight years before the 2020 pandemic declaration.

article continues after advertisement

Wealth Creation, Leverage, and Home Appreciation

U.S. homeowners have an average net worth of $430,000 (it’s significantly higher or more than double in California for many), while renters average just $10,000.

The power of leverage for home purchases can increase the annual cash-on-cash return from 5% to 50%+, depending on the down payment invested.

It’s not just your down payment or cash equity that is appreciating each year like with stocks. Rather, it’s the total overall home value that may be leveraged anywhere between 80% and 100% LTV (loan-to-value) with a purchase mortgage.

The average retired homeowner has more than 80% of their entire net worth tied up in the equity in their primary home where they live.

If mortgage rates suddenly fall soon, will buyer demand rapidly increase to help offset the rising supply numbers? Conversely, will rising rates scare off many future buyers who may be struggling to qualify for these high home prices?

It’s more likely than not that both consumer and government debt will continue to increase in the near future. If so, our dollar may continue to weaken and inflation will keep steadily making prices less affordable for goods and services.

If you rent, inflation is not so fun as your annual rents paid may consistently increase. However, homeowners and landlords usually enjoy the power of leverage and appreciation as their overall net worth continues to grow over time.

Two exceptional hedges against inflation have proven to be real estate and gold. The main difference between these two investment choices is that you can live in homes where you can store your gold bars too.

Rick Tobin

Rick Tobin has worked in the real estate, financial, investment, and writing fields for the past 30+ years. He’s held eight (8) different real estate, securities, and mortgage brokerage licenses to date and is a graduate of the University of Southern California. He provides creative residential and commercial mortgage solutions for clients across the nation. He’s also written college textbooks and real estate licensing courses in most states for the two largest real estate publishers in the nation; the oldest real estate school in California; and the first online real estate school in California. Please visit his website at Realloans.com for financing options and his new investment group at So-Cal Real Estate Investors for more details. 

Learn live and in real-time with Realty411. Be sure to register for our next virtual and in-person events. For all the details, please visit Realty411.com or our Eventbrite landing page, CLICK HERE.

Are Stagflation Risk Concerns Valid or Not?

By

By Rick Tobin

Stagflation is the simultaneous appearance in an economy of slow growth, high unemployment, increasing rates, and rising prices.

The last major stagflation era here in the U.S. was during the years between 1973 and 1982. Back then, energy and overall inflation rates rose so quickly that the Federal Reserve kept pushing rates higher in order to cool or “quash” inflation and unemployment rates rose as well.

article continues after advertisement

For example, the Fed increased their Fed Funds Rate from 6.75% in January 1978 to 10.25% in April 1979 and later to 20% in December 1980. The U.S. Prime Rate for the most creditworthy borrowers also peaked at 21.5% starting in December 1980 and the 30-year fixed mortgage rate hit 18.6% in October 1981.

Generally, energy price swings are a root cause of overall inflation trends up or down. This is partly due to the fact that our transportation supply chain (ships, trucks, airplanes, trains, etc.) is so heavily dependent upon various types of fuel to deliver consumer goods.

The Oil Shock Crash of 1973 was a key factor or catalyst for this stagflation era:

1973 – Oil Shock Crash: This was directly related to the end of Bretton Woods when the “gold standard” was switched to the Petrodollar (“oil for dollars”) system beginning earlier in 1971. Between October 1973 and January 1974, oil prices quadrupled within just a few months due to the ongoing OPEC (Organization of Petroleum and Exporting Countries) Embargo, or the reduction in oil production, increasing U.S. demand, and skyrocketing oil prices for consumers.

Because the mortgage rates offered by banks and mortgage brokers were so high during this stagflation era, an increasing number of sellers were offering their own versions of seller-financing such as carrying brand new 1st mortgages or offering recorded or unrecorded “wraparounds” like contracts for deed (aka “land contracts”) or AITDs (All Inclusive Trust Deeds) with much lower rates and easier qualification guidelines.

At the most recent two-day Federal Open Market Committee meeting held by the Federal Reserve that ended on May 7, 2025, Fed Chairman expressed concerns about increasing stagflation risks due to rising unemployment and price trends and left rates unchanged.

Real Inflation Trends for Food, Work, and Homes

Is the purchasing power of your dollar rapidly declining and/or are your assets rapidly increasing in value on their own due to supply and demand? The answer seems to be a combination of both.

Since 2019, the true rates of inflation seem much higher than the published inflation data shared by the federal government.

Sixteen popular chain restaurants increased their prices by an average of 42% between 2020 and 2025, according to a Finance Buzz study. IHOP’s menu prices were up +82%.

Over the period of 50 years (1973 – 2023), home prices rose by nearly 1,300% as compared with a 610% gain in the CPI (Consumer Price Index).

The inflation-adjusted hourly work wage has jumped by just a measly 1% over the past 50 years (not an annual 1% increase, but a 1% total gain over and above 1973’s wages in 2023 at a 1/50th of 1% increase per year rate).

By comparison, the inflation-adjusted median home price has gained 100% over the past 50 years. As a result, real home prices have increased by more than 100 times (or 100x) the real wage gains.

Between 1950 and 2024, U.S. home prices increased, when adjusted for inflation, at more than double the rate of inflation in all 50 states, from a low of 107% above inflation in Ohio to a high in Alaska that was 675% above inflation.

Sources: CPI, Federal Reserve, ZeroHedge, & Brilliant Maps

Tariffs Raise Prices

A tariff is a euphemism for a “tax payable by you” and the American business owners who first import these foreign goods. Warren Buffett has famously said in the past that “tariffs are an act of war” because nations will keep increasing tariffs on other nations as the trade wars rapidly increase and more of us worldwide are paying higher prices.

The business owner usually has two choices when they pay more for a product or service shipped in from another nation. The first choice is for the U.S. business to “eat” the higher tariffs and absorb the losses directly if it doesn’t force them to operate at a loss and later shut down their business. The second option is to increase the prices for consumers if they can afford to purchase these products.

There’s a very fine line here between raising prices for goods high enough to cover the tariff import costs for the U.S. wholesale business and raising the prices too high where it will drastically reduce the number of buyers who can afford to pay for it.

Long Beach and San Pedro Ports

How will tariffs and subsequent trade wars directly impact ports in Long Beach and San Pedro as well as the overall economy here in California and across the nation? Upwards of 60% of all cargo containers that reach the ports in Long Beach, California originate from China.

The proposed tariffs for consumer goods and services from foreign nations may hit upwards of 180 nations across our planet, so it’s just not an issue with Chinese imports.

Specifically, California imports the most goods from the nation of China. As a result, my home state of California may get hit harder than other states if and when the tariff and trade wars are resolved sooner rather than later.

The Law of Supply and Demand simplified: When there are fewer goods available to purchase and the demand remains steady or even increases, the prices shall rise too.

Consumer spending generally represents upwards of 70% of the annual GDP (Gross Domestic Product), so keep a close eye on this ongoing situation.

Inflationary or Deflationary Economic Cycles

As I wrote almost 10 years ago in my Inflation, Money, and Real Estate article, there are a number of wide-ranging economic cycles that can help asset prices rise or fall.

Inflation has been described as an increase in the general level of prices of a certain product in a specific type of currency. Inflation can be measured by taking a “basket of goods,” and then comparing them at different periods of time while adjusting the changes on an annualized basis. There are many different types of measurements of inflation depending upon the “basket of goods” selected.

General inflation measures the value of a currency within a certain nation’s borders, and refers to the rise in the general level of prices. Currency devaluation measures the value of currency fluctuations between different nations. Some related terms associated with inflation are as follows:

* Deflation is a rise in the purchasing power of money, and a corresponding lowering of prices for goods and services. The Fed doesn’t like this economic period of time, and will probably cut short term rates to try to offset it.

* Disinflation refers to the slowing rate of inflation. The Fed may like this type of economic time period, and may stop raising rates at this point in the economic cycle.

* Reflation is the period of time when inflation begins after a long period of deflation. Depending upon the severity of inflation or deflation, the Fed may pause with the rate hikes or gradually begin rate hikes.

* Hyperinflation is rapid inflation without any tendency toward equilibrium. It is inflation which compounds and produces even more inflation. It is when inflation is much greater than consumers’ demand for goods and services. The Fed, and the rest of America, do not typically like this economic period, so they may enact a series of significant rate hikes to slow down these high inflation levels.

Measurements of Inflation

There are many ways to measure inflation. These inflationary measurement descriptions include the following:

* Consumer Price Index (CPI): The Consumer Price Index is the measure of the average change in prices over time for goods and services purchased by households. The Bureau of Labor Statistics reports CPIs for different types of population groups such as wage earners, clerical workers, business professionals and managers, technical workers, self-employed, short-term workers, unemployed individuals, and retirees.

The CPI is an estimate of inflation as experienced by consumers in their daily living expenses. The CPI may factor in the change in the price for food, clothing, rent, fuel costs, transportation expenses, doctor visits, medicine, insurance, and other lifestyle basics which we need in our daily world.

* Producer Price Index (PPI): The Producer Price Index measures the price of goods and services at the wholesale level. There are three types of categories for calculating the PPI. These categories include crude materials, intermediate materials, and finished goods. One of the most important categories for calculating inflation rates is the “finished goods” category. Finished goods are the prices ready for sale to the end user – the consumer. Product prices at the crude or intermediate stages typically may be an early indication of future inflationary or deflationary pressures.

The financial markets tend to focus on the fluctuations of prices for all category types. Food and energy costs are usually excluded as they tend to change quicker than any other goods or services represented within the “core rate.” So, the true annual inflation rates are usually much higher than the reported rates.

* Import and Export Prices: The International Price Program measures the changes in the prices of imports and exports (excluding military goods) between America and the rest of the world. Please focus on this economic data as it relates to the tariff and trade war stories.

* Consumer Spending: It measures the spending habits of American consumers. These spending habits include data on daily expenditures, income, and consumers’ many wide-ranging preferences for certain types of goods or services.

Cash is King

Unfortunately, a high percentage of Americans today live off of credit cards and Buy Now, Pay Later (BNPL) type of debt options. Most people also purchase consumer goods with credit cards much more often than with physical cash.

There have been several prominent telephone surveys with thousands of U.S. consumers who were asked anonymously if they could come up with either $400 or $500 in actual physical cash for an unexpected emergency like a medical bill. Sadly, upwards of 60% of the surveyed American consumers in some of these polls said “No” to their ability to find this cash.

A recent study by SmartAsset included an analysis of median bank deposit data for households by state from the Bureau of Labor Statistics found that households in Hawaii had the highest median bank balance of $43,600. In contrast, households in Mississippi held just $2,000 in the bank.

article continues after advertisement

Rank / State / Median Household Cash Bank Balance

1. Hawaii: $43,599
2. New Jersey: $21,268
3. Washington: $19,035
4. Massachusetts: $17,387
5. California: $17,046
6. Minnesota: $16,834
7. Virginia: $16,695
8. Maine: $15,951
9. Colorado: $14,888
10. Montana: $14,388
11. Utah: $13,984
12. Oregon: $13,909

Ride the Inflation Wave with Real Estate

Whether our economy booms, busts, or remains fairly steady this year, it’s still quite likely that the purchasing power of our dollar will continue to fall like it has since 1913. If so, keeping the bulk of assets in cash under your mattress may not be the wisest choice besides having a “security blanket” by your side in case of an emergency.

The potential combination of rising unemployment, inflation, and rates (aka “stagflation”) is usually not a positive short-term outcome for home value trends.

Real estate investments, however, have continued to show us that it’s an exceptional hedge against inflation, while usually more than doubling in value over and above the published inflation rates.

No matter your perception of the current economic state of our economy (stagflation, disinflation, or hyperinflation), the long-term holding of real estate assets may continue to be a very wise choice through the various boom and bust cycles over a long period of time.

Rick Tobin

Rick Tobin has worked in the real estate, financial, investment, and writing fields for the past 30+ years. He’s held eight (8) different real estate, securities, and mortgage brokerage licenses to date and is a graduate of the University of Southern California. He provides creative residential and commercial mortgage solutions for clients across the nation. He’s also written college textbooks and real estate licensing courses in most states for the two largest real estate publishers in the nation; the oldest real estate school in California; and the first online real estate school in California. Please visit his website at Realloans.com for financing options and his new investment group at So-Cal Real Estate Investors for more details. 

Learn live and in real-time with Realty411. Be sure to register for our next virtual and in-person events. For all the details, please visit Realty411.com or our Eventbrite landing page, CLICK HERE.

How to Leverage Real Estate Equity to Reduce Medical Debt

By

By Rick Tobin

The greatest form of wealth is happiness and good health, from my perspective. If you live a shortened life due to significant health challenges, it really doesn’t matter whether you’re rich or poor if you’re not around to spend the money on yourself or share with your loved ones.

Unless you’re a billionaire, the odds are quite high for the typical homeowner that the bulk of their net worth created during their lifetime originated from the equity built up in their primary home after years or decades of mortgage payments.

What’s interesting to me is that the average U.S. home seller in 2024 was 63 years of age. If many of these home sellers purchased their home using a 30-year fixed rate mortgage and did not accelerate the mortgage payoffs with bi-weekly payments and/or extra principal paydowns, then many sellers first bought the home 30 years earlier in 1994 at the age of 33.

article continues after advertisement

I’m sure that a high percentage of these home sellers did not want to sell their homes at the average age of 63 last year in 2024. They either needed to downsize their living space after their family members moved out years or decades earlier, or they couldn’t afford to continue paying rising insurance, property tax, credit card, student loans for themselves or their children or grandchildren, and/or medical bills.

Another motivating factor for some of these home sellers is that they wanted to take their equity gain and share it with loved ones after selling the home and moving to a smaller property. However, there are still ways to stay in a home of any size and later transfer the equity gains to the family heirs by way of family trusts, family limited partnerships, and other entities suggested by their trusted advisors and reverse mortgage solutions.

Medical Dependence and Skyrocketing Costs

Real estate creates the bulk of wealth for most Americans that were likely purchased earlier in life and medical bills later in life can wipe out most or all of the same wealth, tragically.

The U.S., with just 4.5% of the world’s population, consumes 2/3rds, or a rather devilish 66.6%, of all pharmaceuticals on the planet.

The #1 cause of financial insolvency here in the U.S. is directly related to unpaid medical bills. This is in spite of more than 70% of these same people having medical insurance coverage at the time that wasn’t sufficient enough to cover all of the medical debt.

According to the Centers for Disease Control and Prevention (CDC), almost 60% of American adults have at least one chronic disease such as cancer, diabetes, heart disease, stroke, dementia and other neurological challenges, and obesity. Sadly, a high percentage of young children and teenagers also battle one or more chronic disease symptoms.

The medical treatment costs for some of these almost lifelong health challenges can run anywhere between several hundred thousand to a few million dollars over years or decades. For example, some memory care assisted living facilities with 24-hour services can cost between $10,000 and $20,000+ per month, depending on the healthcare provider and state location, as per CareScout.

The other major financial anchor holding back many households today is ongoing student loan debt for either the main homeowner or he or she acted as a co-signer on a student loan for a child or grandchild. Almost 43 million Americans owe an outstanding balance of $1.777 trillion in federal student loans as of the end of 2024, as per USA Today.

The combination of all-time record credit card balances now surpassing $1.2 trillion dollars along with medical, student, mortgage, and other consumer loan debt is quite stressful for millions of families across our nation.

article continues after advertisement

All-Time Record Tappable Equity

American mortgage holders now have access to a staggering $11 trillion in tappable equity that’s over and above their existing mortgage balances, according to the May 2024 Mortgage Monitor report from the Intercontinental Exchange (ICE).

The amount of residential property equity is so massive that if all 48 million homeowners spent $10 million of their tappable equity each day, it would take more than 3,000 years to exhaust it, as per ICE. This amount of residential equity available is more money than the Gross Domestic Product (GDP) of Japan, India, and the United Kingdom combined.

The same ICE report identified just five housing markets on the West Coast that represented a quarter of that $11 trillion equity number: Los Angeles, San Francisco, San Jose, San Diego, and Seattle.

Housing Wealth and Home Care for Older Residents

Let’s take a closer look at health, wealth, and medical trends for Americans:

● U.S. homeowners over 62 years of age had $14 trillion in housing wealth as of Q2 2024.
● Social Security, Medicare, pensions, and investments are no longer sufficient enough for many people to cover rising monthly debts that especially includes skyrocketing medical costs (#1 cause of bankruptcy).
● Just 14% of American seniors, or fewer in pricier regions, can afford home care, as per Joint Center for Housing Studies, Harvard University.
● Over 40% of Americans aged 65+ live alone, and this percentage number increases after the age of 80.
● 70% of people aged 65+ will need long-term care services, according to the U.S. Department of Health and Human Services.
● Fewer Americans can afford personal home care as costs have risen 20% to 40% since 2021.
● Some in-home care plans are now $5,000 to $10,000 per month and living facility care plans may reach $10,000 to $20,000 per month.
● Nearly 1-in-3 people have left their jobs to help ailing family members with lost wages possibly hitting $147 billion by 2050.
● Today, there are over 50 million family caregivers.
● Only 3% to 4% of Americans aged 50+ pay for a long-term care policy, as per LIMRA (Life Insurance Marketing and Research Association).
● For most homeowners, the equity in their primary home represents the bulk of their untapped wealth.
● Tapping into the tax-free home equity by way of a reverse mortgage strengthens clients’ abilities to possibly retire more comfortably, reduce financial burdens on families, and increase future wealth transfers.

Baby Boomers & Reverse Mortgage Solutions

Baby Boomers (born between 1946 and 1964) hold the highest percentage of real estate wealth today. Let’s review this generational group’s latest trends and ways to tap into their home equity:

● 12,000 Baby Boomers (born: ‘46-’64) per day surpass the age of 65.
● In 2024, 25% of Americans were 60 years of age or older.
● The average home seller in 2024 was 63 and the average buyer was 56.
● By 2030, 100 million Americans will be 65 years old.
● 10,000 Boomers retire daily. 8% to 10% of them own small businesses that could be purchased by you at discounts for quick cash.
● There’s upwards of $11 trillion in tappable home equity available for reverse mortgage prospects using these loan guidelines.
● Only one of the borrowers on the application needs to be 62.
● An individual or a trust may be allowed to be the borrower.
● Home is still owned by the borrower, not the lender, and can later be sold.
● There are no monthly mortgage payments required.
● The homeowner must pay their property taxes, insurance, HOA payments (if applicable), and maintain the property.
● Borrowers can receive a large lump sum at closing and future payments are paid directly to them each month.
● This is considered a loan and not additional income, as per the IRS. It does not reduce Social Security or Medicare benefits.
● Lower FICO scores and income considered for easier qualification.

Income-Producing Assets & Insurance Safety Nets

It’s not uncommon for wealthier families to have large amounts of medical and life insurance protection plans in place as their figurative “safety nets” in the event of an unexpected medical emergency or death of a key patriarch or matriarch in their family.

These insurance plans help protect family wealth so that it can later be passed on to loved ones instead of exhausted it on medical bills with no insurance protection to cover these staggering bills that can reach hundreds of thousands of dollars or more.

Let’s now compare the Top 0.1% (1/10th of 1%) to the Bottom 50% of Americans by their income and asset holdings as of Q1 2025:

The richest 0.1% (134,000 households) own $11 trillion in equities or stocks, which is their largest asset class. This is worth more than the total combined wealth assets of the bottom 50% (66.6 million households), as per Visual Capitalist.

The Top 0.1% control the bulk of stocks or equities at $11 trillion as compared with the Bottom 50% households’ $0.5 trillion or $500 billion in stock ownership.

Key points: The bottom 50% households’ largest category of wealth is held in real estate and amounts to $4.9 trillion combined as compared with the Top 0.1% households’ $2 trillion combined amount held in real estate.

Visualizing Wealth Distribution In America (1990 to 2023)

Wealth distribution has become increasingly concentrated in the hands of fewer people since 1990. Overall, the top 10% of wealthiest Americans own more than the bottom 90% combined, with more than $95 trillion in wealth for the top 10%, according to the Federal Reserve and Visual Capitalist.

In 2024, the share of wealth held by the richest 0.1% is near its peak with a minimum of $38 million in wealth in just 131,000 households. With $20 trillion in wealth, the top 0.1% earn an average of $3.3 million in income each year. The greatest share of the wealth owned by the top 0.1% is held in stocks and mutual funds.

Households in the lower-middle and middle classes as found in the 50% to 90% income and asset brackets are claimed to have a minimum of $165,000 in wealth held primarily in real estate, followed by pension and retirement funds.

Keep Real Estate Wealth in Your Family Tree

Unless you’re in the Top 0.1%, the odds are quite high that the bulk of your wealth is concentrated in real estate if you’re fortunate enough to own now.

The average American today still owns and controls the bulk of residential real estate. We must continue moving forward to maintain this control of residential properties so that the multi-billion dollar corporations don’t pick up larger shares of properties that form the foundation for the creation of generational wealth and the American Dream for so many people today.

Today, it’s advisable to have the right mix of real estate, mortgages, and insurance to create, maintain, and protect your wealth. We must also stay focused on reducing monthly expenses that can erode wealth on a daily compounding basis.

If you’d like to learn more details about how my team and I can assist you with protecting and increasing the size of your family’s assets and reducing your overall monthly expenses, please reach out to me today for assistance.

Rick Tobin

Rick Tobin has worked in the real estate, financial, investment, and writing fields for the past 30+ years. He’s held eight (8) different real estate, securities, and mortgage brokerage licenses to date and is a graduate of the University of Southern California. He provides creative residential and commercial mortgage solutions for clients across the nation. He’s also written college textbooks and real estate licensing courses in most states for the two largest real estate publishers in the nation; the oldest real estate school in California; and the first online real estate school in California. Please visit his website at Realloans.com for financing options and his new investment group at So-Cal Real Estate Investors for more details. 

Learn live and in real-time with Realty411. Be sure to register for our next virtual and in-person events. For all the details, please visit Realty411.com or our Eventbrite landing page, CLICK HERE.

Wealth Perspectives: A Comparative Worldwide Analysis

By

By Rick Tobin

There are relatively few people who truly feel wealthy and don’t worry about their monthly income covering their rising monthly expenses almost daily or weekly. It’s much more important how much you save and invest each month rather than spending 100% of your net income on household expenses.

Comparing one’s wealth with friends and family can be quite depressing for many because you’re more likely to know someone much wealthier than you. It’s much more healing for you to focus on what you do have in life and who loves you by way of gratitude. This is because good health and happiness are the greatest forms of wealth in this world.

“Comparison is the thief of joy.”
– President Theodore Roosevelt

article continues after advertisement

Let’s take a closer look below at how you may compare with the rest of the world as per the World Bank:

  • Approximately 8% of the world’s population lived in extreme poverty back in 2019, which means that they subsisted on just $2.15 (U.S.) per day.
  • The World Bank listed worldwide poverty numbers within two daily income thresholds as lower-middle-income countries (LMICs) at $3.65 (U.S.) and upper-middle-income countries (UMICs) at $6.85 (U.S.) per day.
  • Approximately 23% of the world’s population lived below the UMIC daily income range of $3.65 in daily income.
  • Another 47% of people worldwide lived below the $6.85 poverty line, as shared in a World Bank report entitled Poverty and Shared Prosperity 2022.
  • The median worldwide income of $7.60 per person per day is very close to the upper-middle-income countries (UMICs) line.
  • 70% of the world’s population lived in middle-income economies, where the international poverty line might be too low to define someone as poor.

Daily Median Income Doubled (2001 to 2017)

For most Americans, the median worldwide income of $7.60 per day (or $2,774/year) for the 2019 year probably is much lower than what the typical American earns. Yet, the years preceding 2019 had much lower annual income estimates for the years between 2001 and 2017 as shared below:

  • The daily income per person was closer to $3 back in 2001.
  • Sixteen years later in 2017, the daily income doubled to $6.50.
  • Almost 85% of the world’s population lived on just $30 per day ($10,950/year) in 2017.
  • An estimated 65% of people lived on $10 per day ($3,650/year).
  • Approximately 10% lived on less than $1.90 per day ($693.50/year).

Source: Daily Median Income for World by Crews Bank

article continues after advertisement

Will You Outlive Your Money?

Unless you’re close friends with billionaires, the odds are quite high that a high percentage of your friends and family created the bulk of their overall net worth from investing in real estate over several years or decades. Your friend might’ve first purchased their home on their own with 100% financing or it was passed down to them from their parents or grandparents over one or two generations.

One of our greatest fears is that we may run out of savings or not have sufficient amounts of monthly income to cover our expenses. For most people here in the U.S. and across the world, they have probably run out of money at some point in their lives whether they were young teenagers or older retirees.

Running out of money during one’s retirement years is truly one of the scariest situations for an increasing number of older Americans. As shared by the Pew Research Center and Forbes, the fastest-growing demographic for U.S. workers entering (not exiting) the workforce in 2024 were people over the age of 75 because their Social Security and pension (if available) income was not sufficient enough to cover their rising monthly expenses.

A recent study completed by Visual Capitalist found that there was $123 trillion dollars’ worth of cash, savings, time deposits, and money market funds in 2024 that’s described as the Global M2 Money Supply. If the $123 trillion in cash or cash-like instruments were shared equally as savings for the estimated eight billion people living today, it would amount to $15,000 for every person on the planet.

If you earn $3 per day in income while only spending $2 per day, you’re net ahead each day. However, if you earn $15,000 per month and spend $16,000 per month, you’re struggling and likely to eventually run out of cash savings.

The Top 10 Most Challenging Retirement States

Listed below is a detailed analysis created by GOBanking Rates and shared by CNBC that shows how quickly $1 million dollars’ worth of retirement savings plus Social Security income can be depleted anywhere between 12 and 27 years for the Top 10 most expensive states.

However, this report completely excluded federal and state income taxes from this analysis (California’s highest state income tax rate is 13.3% and Hawaii’s is 11%), so it’s more likely that residents will spend their money at a faster pace due to taxes and future rising inflation rates.

Here are the 10 states where $1 million runs out the fastest in retirement:

1. Hawaii
Monthly expenses: $2,761
Annual cost after Social Security: $80,125
Years $1 million lasts: 12

2. California
Monthly expenses: $2,269
Annual cost after Social Security: $61,406
Years $1 million lasts: 16

3. Massachusetts
Monthly expenses: $2,340
Annual cost after Social Security: $51,686
Years $1 million lasts: 19

4. Washington
Monthly expenses: $2,096
Annual cost after Social Security: $45,629
Years $1 million lasts: 22

5. New Jersey
Monthly expenses: $2,001
Annual cost after Social Security: $41,315
Years $1 million lasts: 24

6. Colorado
Monthly expenses: $1,899
Annual cost after Social Security: $39,759
Years $1 million lasts: 25

7. New Hampshire
Monthly expenses: $2,081
Annual cost after Social Security: $38,052
Years $1 million lasts: 26

8. Utah
Monthly expenses: $1,876
Annual cost after Social Security: $37,060
Years $1 million lasts: 26

9. Oregon
Monthly expenses: $2,017
Annual cost after Social Security: $37,346
Years $1 million lasts: 27

10. Rhode Island
Monthly expenses: $2,113
Annual cost after Social Security: $36,920
Years $1 million lasts: 27

By contrast, $1 million in retirement savings plus Social Security should last at least 30 years in 36 other states, as per this same GOBankingRates report.

Source: The 10 states where $1 million runs out the fastest in retirement—it’s just 12 years in Hawaii

Inflation: Weakens Dollar, Boosts Real Estate

You’re likely to run out of cash if the bulk of your investments are held as cash, ironically. How is this seemingly contradictory statement true or not?

Every single year, the dollars in your pocket get weaker and weaker due to inflation. For example, it’s been claimed that $1 in 1913 when the Federal Reserve was formed is now worth closer to 2 or 3 cents today after 112 years’ worth of inflation continually weakening our dollar.

I’ve described real estate as an exceptional hedge against inflation for several decades. This is because home values tend to rise at least as high as the published historical inflation rates. Yet, this description does not give real estate enough credit for how much higher homes have appreciated as compared with inflation.

For example, U.S. home prices between 1950 and 2024, when adjusted for inflation, more than doubled the annual published rate of inflation in every single state in America, according to Brilliant Maps. From a low of a 107% home value gain as compared to inflation in Ohio to a high of a 675% home gain in Alaska, the investment returns for property owners were quite impressive.

The creation of multiple income streams, whether it be from one, two, three, or four jobs or part-time gigs, rental properties, discounted mortgage or note investments, stocks, bonds, or insurance investments, or other sources, is what you should invest your time and energy on each day or week. The future version of you will later thank you for starting your investing strategies sooner rather than later.

If you earn $5 per day or $5,000 per day, you should focus on your daily expenses as well. Are you still earning more than you spend each day? If not, then please focus on ways to generate one or more additional income streams that may likely originate from real estate one way or another.

Should you be holding a coffee in your hand priced near the daily median worldwide income average of $7.60 and have a roof over your head while reading this article, you’re doing OK and should be grateful as compared with the rest of the world.

Rick Tobin

Rick Tobin has worked in the real estate, financial, investment, and writing fields for the past 30+ years. He’s held eight (8) different real estate, securities, and mortgage brokerage licenses to date and is a graduate of the University of Southern California. He provides creative residential and commercial mortgage solutions for clients across the nation. He’s also written college textbooks and real estate licensing courses in most states for the two largest real estate publishers in the nation; the oldest real estate school in California; and the first online real estate school in California. Please visit his website at Realloans.com for financing options and his new investment group at So-Cal Real Estate Investors for more details. 

Learn live and in real-time with Realty411. Be sure to register for our next virtual and in-person events. For all the details, please visit Realty411.com or our Eventbrite landing page, CLICK HERE.