On this week's episode, Benjamin and Cameron are talking real estate, specifically mortgage rates and REITs. For the first time since the early 90s, fixed mortgage rates are lower than variable ones, which have always been the popular choice. However, due to the fact that Canada’s yield curve is inverted, short term rates higher than their long-term counterparts. This is not usually the case, which makes it a great time to consider a fixed term mortgage, bearing in mind that it requires some lifestyle considerations. Benjamin and Cameron also provide some insights into the rental property market changes since 2015, with some astonishing figures. They then discuss REITs, which many think should be considered their own asset class. While it is often recommended to have REITs in your portfolio, research is starting to show that you are taking a great deal of risk you are not being compensated for. This means you may be better off investing in other options such as high exposure bonds which bear much less risk. For all this and much more, join us today! Key Points From This Episode: 3:58 Why fixed-rate mortgages are now lower than variable-rate ones. 6:25 Interest rates went up, but the shape of the yield curve changed as well. 7:12 Property prices have almost doubled relative to rent since 2015. 12:48 What a rental wage is. 17:05 What a REIT is and the benefits of investing one in your portfolio is. 21:01 Why the risk of a REIT may not be justifiable. 26:23 Variable annuity investors routinely outperform mutual fund investors Links From Today’s Episode: Rational Reminder Website - https://rationalreminder.ca/podcast/58 With fixed rates below variable ones, mortgage market is in the Upside Down - https://globalnews.ca/news/5666381/fixed-variable-mortgage-rates-canada-inverted-yield-curve/ Mapped: The Countries With the Highest Housing Bubble Risks - https://www.visualcapitalist.com/mapped-the-countries-with-the-highest-housing-bubble-risks/ Housing Affordability Survey - https://www.financialplanningforcanadians.ca/financial-planning/housing-affordability-survey Unaccommodating: Rental Housing Wage in Canada - https://www.policyalternatives.ca/sites/default/files/uploads/publications/National%20Office/2019/07/Unaccommodating%20-%20Rental%20Wage%20in%20Canada.pdf Real estate property price trend in Toronto - https://www.torontohomes-for-sale.com/Toronto-average-real-estate-property-prices.html Real Estate Betas and the Implications for Asset Allocation - https://joi.pm-research.com/content/27/1/109 Are REITs a Distinct Asset Class? - https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2965146 Investors Are Usually Wrong. I’m One of Them. - https://www.nytimes.com/2019/07/26/your-money/stock-bond-investing.html Thinking Out Loud - https://humbledollar.com/2019/07/thinking-out-loud/ ‘There’s No Better Time to Be an Active Manager’ - https://www.institutionalinvestor.com/article/b1gfk7pc5x32nl/There-s-No-Better-Time-to-Be-an-Active-Manager You can find the Rational Reminder podcast on 🍏 Apple Podcasts: https://podcasts.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582?mt=2 🎤 Spotify Podcasts: https://open.spotify.com/show/6RHWTH9iW7hdnA7eAg7ukO?si=hjZNfLKuSjSeWX38GPqhVA 🕵️‍♂️ Google Podcasts: https://podcasts.google.com/?feed=aHR0cHM6Ly9yYXRpb25hbHJlbWluZGVyLmxpYnN5bi5jb20vcnNz as well as on all major podcatchers You can follow Cameron Passmore and Ben Felix on Twitter: ➡️ https://twitter.com/CameronPassmore ➡️ https://twitter.com/benjaminwfelix Check out Ben's YouTube channel. 📺 https://www.youtube.com/benfelixcsi Catch up on the latest in wealth management and investing insights from the Passmore-Felix Team at PWL Capital. https://www.pwlcapital.com/teams/passmore-felix/?utm_source=youtube&utm_medium=copy&utm_campaign=rr&utm_content=rrvideo The Rational Reminder is presented as an educational resource and should not be construed as individualized investment advice, nor as a recommendation to buy or sell specific securities. The funds and portfolios discussed are examples only and may not be appropriate for your individual circumstances. #investing #podcast #business