Ken McElroy Show

ChatGPT Predicts the top Real Estate Warnings for 2025

May 9, 2025
Robert Helms, from The Real Estate Guys, brings years of radio experience to the table, discussing pressing real estate challenges for 2025. They delve into the implications of rising interest rates and a staggering $9 trillion debt rollover. The conversation highlights the shift from homeownership to renting and the possible inventory shortages ahead. There's also a focus on the significance of strategic thinking in investments and the importance of networking, especially with the upcoming investor summit at sea.
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INSIGHT

Interest Rate Shock's Market Impact

  • Interest rates have risen quickly, causing a shock for homeowners and investors alike.
  • Many aren't moving or buying due to high costs, impacting the real estate market profoundly.
INSIGHT

Cost of Capital Beyond Debt

  • Cost of capital includes both debt and equity, not just loans.
  • Investors expect returns exceeding low-risk alternatives like T-bills to justify risks.
ADVICE

Calculate Blended Cost of Capital

  • Calculate blended cost of capital by weighting debt and equity costs to assess investment viability.
  • Ensure property returns exceed this blended rate to make the investment profitable.
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