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Good Saturday morning.
It's music week here in Miami! Later today, I'm seeing one of my favorite DJs, Black Coffee, live in concert. If you know, you know.
You’ve probably also noticed that we’ve been A/B testing different send days, from early-week, to mid-week to now weekend in this post. We’re looking for which day “hits” the best for our audience. Next week, we’ll go back to our regular Tuesday morning distro schedule.
For today's newsletter: Mortgage rates are moving in the wrong direction. And I'm seeing it firsthand in my real estate credit business.
Today’s word count: ~1,500 words… 5-6 min read.
Multifamily rates are up. Hopefully they come down soon, if the end of the Iran Conflict is near.
The Big Idea: War, Inflation, and a Rate Squeeze. The 2026 Deal Math Just Changed.
Here's the thing. The housing market entered 2026 expecting rate relief. That relief isn't coming soon.
Mortgage rates hit 6.62% this week. Closer to 7% than 6%. Purchase applications fell 5% in a single week. If you were modeling single family rentals at 5.5-6%, the math just broke.
This isn't one bad headline. Three forces are converging at the same time. Let me walk you through them.
🌍 First, the Iran conflict is moving your mortgage rate.
War drives uncertainty. Uncertainty drives Treasury yields higher. Mortgage rates follow Treasuries. Since the Iran conflict escalated two weeks ago, rates have moved meaningfully in the wrong direction. This is geopolitical risk landing directly on your monthly payment.
📈 Second, inflation is running hotter than the Fed thinks.
A global forecasting group projects US inflation at 4.2%. Well above the Fed's own estimate. Axios ran the headline this week: "Inflation shock warning." That's not a blogger. That's a major national news outlet.
🏦 Third, the Fed is not coming to save you.
The Fed held rates steady and signaled one cut for all of 2026. One. Not three. Not two. Just one. I'm bummed out about it, too. If inflation runs hotter than the Fed expects, even that one cut may not happen.
💡 I'm living this in my real estate credit business. I’m the Chief Investment Officer at USDV Capital, a private lending platform for real estate investors. We've had to raise our DSCR (debt service coverage ratio -- the metric lenders use to measure whether a property's income covers its debt) permanent loan rates twice in the last two weeks. Each hike: 50 basis points. That's 100 basis points (or 1.00% in normal language) of total increase since the Iran conflict started.
Why it matters: This is not a blip. Three structural forces. Same direction. Every deal type is affected.
Investors: rerun your models at 7%. Whatever still works is your real pipeline.
Developers: construction financing and permanent takeouts both getting more expensive. LIHTC (Low-Income Housing Tax Credit) deals that were marginal at 6% are dying at 6.62%.
Renters and homebuyers: monthly payments on a median-priced home just went up. Again. The "wait for rates to drop" strategy is failing.
Affordable housing: higher rates mean higher cost of building affordable units. The people who can least afford it get hit hardest.
The bottom line: If you have deals that work at these rates, move. If you don't, don't force it. Patient capital wins. It always does.
Smart starts here.
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Signal vs. Noise.
❌ NOISE: Fannie Mae Will Accept Crypto-Backed Mortgages
Fannie Mae (the government-backed company that guarantees roughly half of all US mortgages) will accept crypto holdings as part of mortgage qualification. First time ever.
Why it matters: It probably doesn't. How many people are actually qualifying for a mortgage with a crypto portfolio? Maybe a handful per year. The volatility problem alone kills this at scale. Your crypto drops 40% after closing. Then what? This is a headline, not a housing solution.
Go deeper: Inman News
⚠️ COULD GO EITHER WAY: Congress Takes Aim at Build-to-Rent Housing.
A provision in the ROAD to Housing Act targets BTR (build-to-rent) communities -- purpose-built rental neighborhoods designed from the ground up for renters. NMHC (National Multifamily Housing Council) responded by launching ProtectRentalChoice.org.
Why it matters: This is different from California's AB 1240 (which targeted buying existing homes). This targets building new rental housing. Let me be clear about the irony: Congress is trying to restrict the exact housing type the market needs most.
What to watch: The Senate. If the chamber moves, this is a real signal for every developer and BTR operator. If there's acrimony, it dies before reaching the President's desk. Verdict: SIGNAL if Senate moves. NOISE if it stalls.
Go deeper: ProtectRentalChoice.org
Screenshot of my text with the "Make America AI-Ready” AI from the U.S. Department of Labor.
The Numbers: 20202.
That's not a zip code, LOL. It's a phone number. Text READY to 20202 and the U.S. Department of Labor will teach you AI. For free.
On March 24, DOL launched "Make America AI Ready". Not gonna lie with you, the whole branding translation of "MAGA" to just about every government program out there is getting to be a lot (i.e. "MAHA", etc.).
But the premise of this is actually pretty cool for every day folks: a seven-day AI course delivered entirely by text message. Ten minutes a day. No laptop. No login. No Wifi internet required. I tested it myself. Above is a screenshot of the text message.
Why text? Because 16% of American adults don't have broadband. They do have phones. The government chose the most accessible format possible. That design choice tells you everything.
🧮 By the numbers: 58% of small businesses already use generative AI (artificial intelligence that creates content, code, or analysis on demand). Up from 40% last year. The National Science Foundation launched a companion program funding AI literacy hubs in all 50 states. Bipartisan support in Congress.
The bottom line: Last week we talked about Reid Hoffman's 24-month warning. The AI pricing window is closing. This week the federal government validated that thesis at scale. Text READY to 20202. Tell your team. It's free.
Built in Public: 🔨 I Spoke on a Conference Panel This Week. Here's What I Told the Room about Affordable Housing in Florida
Evan and Built Different reader, Joshua Adlam (Acquisitions — Atrium) at the Conference.
I spoke at the IMN Florida Middle Market Multifamily Conference on affordable housing deals, structures, and financing across Florida earlier this week.
The room included mostly industry folks: fellow developers, owner/operators, investors, lendors, attorneys and vendors supporting multifamily housing.
Everybody in the room was asking the same thing: how do you make affordable deals work when construction costs won't come down and rates are going back up?
Here's what I shared. First, public-private partnerships are the way to go on making affordable housing deals really "pencil," as they say. Second, I called out four pillars of a working these public-private partnership in Florida:
Time. Live Local cuts red tape on zoning and approvals.
Money. CRA dollars and local grants make a bigger impact than most people realize.
Tax exemptions. Negotiate with every taxing authority. School board. City. State.
Vouchers. Housing authority vouchers in many FL counties pay 100-110% of market rate.
The insight most people missed: housing authorities want to co-develop with you. They have balance sheets and can help you qualify for below-market financing. When they're on your deal, you can unlock various tax exemptions that are automatic under Florida statutes. No municipality negotiation required.
Enough material from that panel for a deep dive next week. Stay tuned.
Indelible Impact: Women’s History Month!
Mary McLeod Bethune (1875-1955)
In 1904, a woman born to formerly enslaved parents started a school in Daytona Beach, Florida. She had $1.50. Five students. Crates for desks. The school sat on a former city dump. She negotiated the land purchase herself. Raised funds by selling sweet potato pies to construction workers.
That school became Bethune-Cookman University. It's a testament today to the beautiful legacy of Historically-Black Colleges and Universities (HBCUs).
Bethune advised President Franklin D. Roosevelt as the only Black member of his unofficial "Black Cabinet." Founded the National Council of Negro Women in 1935. In 2022, she became the first Black American featured on US currency.
Why it matters: I spoke this week at a conference in Florida about making affordable housing work against every economic headwind. Bethune did exactly that. 120 years ago. With $1.50 and no institutional support. In the same state. That's built different.
Final Thought.
If this issue landed, forward it to someone who needs to read it. Hit reply and tell me what you're building. I read every one.
See you here next week.
-- Evan
Founder & CEO, Built Different & Shieldstone