For Long Time Investors: Economics And Investing
Newbie here. How do you think higher interests will affect the pre-foreclosure and home buying market. I have an idea but wanted input from people that have been in the business for a while. All your replies are greatly appreciated. 
There is already some effect due to short term interest rate increases. There are a number of people that refinanced with ARMs with an initial fixed rate that was very low. Now tha the variable rate has kicked in the payments have gone up dramatically and some of my realtor friends are reporting increases in foreclosures. You can see that LIBOR has increased over the last year (reported on TCI), so loans indexed to LIBOR may be painful.
When the long term rates go up, fewer people will qualify and the demand for housing will go down. There will be more buying opportunities. Another consequence will likely see more of a demand for rentals.
So, does this mean that we will see a cool down of the pre-foreclosure investing business or, by your experience, can we still make a profit under those market conditions. Thanks, your reply is greatly appreciated.
Thanks for the input greenbax.