Relatively speaking, last week we saw a fairly significant rise in the 10-year yield (see graph below). Forgetting the various sociopolitical issues for the moment, it seems that the interest markets are actually concerned about the FED unwinding the stimulus (see 2nd CNBC article below). Of interest (from the graph), the range for 10-year yield in 2017 has been much tighter than it was in 2016. I am not sure that this is significant at this time, but it did jump out at me.
Okay, the article below that was reported at FinancialPlanning.com bugged me. I have never liked it when the adviser that we are dealing with has a clear-cut bias and fails to truly protect their client’s interests and objectives.
I am informed enough to know there are folks that push the stock market type investments too much. And there are those in the real estate profession that push real estate investments likewise. With that said, I appreciate it when advisers from both arenas take their own bias out as much as possible.
If you read that article carefully, then you will notice many areas where it was clearly self-serving for the firm writing it. They started out speaking about investment real estate; and then that somehow morphed into owner occupied residential real estate.
Many clients want home ownership; and there are a lot of professionals that do a great job helping clients get to that goal. Then (especially in the affluent Bay Area) clients often want to make a move toward investment real estate. The good advisers educate the client on the pros and cons. The really good ones help the client understand the options between owning investment real estate, owning stocks and mutual funds, and then the myriad of other choices. Our job is to help our clients obtain their financial objectives.
That means we are their resource. When we focus on them, their objectives, and then protecting them, we get rewarded with their business and referrals when appropriate. Swinging back to the article, although it is veiled as protecting the client, I personally felt it was not presenting a genuine picture of what is in the best interests of a client. And, I know you cannot write your whole strategy in an article. However, you certainly can lay out your values towards doing the right thing and doing your best to support your clients attainment of their financial objectives.
Okay, enough of that rant for the moment. As always, feel free to give me a call to discuss your strategic financing needs.
Articles of Interest:
Forbes reported “Two Smart Long-Term Real Estate Options.” For those that own their own businesses and pay rent or lease, this is some straight-forward advice to buy your own building and lease it back to your business.
The SJ Mercury News reported “Job losses jolt Bay Area, South Bay, San Francisco.”
CNBC reported “Kohl’s opens its doors to Amazon’s returns.” Big Box firms like Kohl’s and Sears have created relationships with Amazon. Expect to see more of these types of strategies in the near future.
CNBC also reported “Fed approves October reversal of historic stimulus, leaves rates unchanged.”
Financial-Planning.com reported “Make sure clients don’t romanticize real estate investing.” Please see today’s commentary stemming from this article.
Malwarebytes shared “Equifax aftermath: How to protect against identity theft.”
See the table below for approximate interest rates.
| Type | Rate | Fixed Term |
| Apartments | 3.675% – 4.450% | 3 to 10 year (30 yr amortization) |
| Commercial | 3.9955% – 4.750% | 3 to 10 year (25 yr amortization) |
| Construction | Call for Rate | Call for Rate |