👇WATCH EPISODE 👇

Bonds and Real Estate: The Hidden Relationship Most Investors Miss

You hear me talk about real estate on the Money Ripples Podcast all the time. But here’s a question most people never ask: What do bonds have to do with real estate?

A lot more than people realize.

In a recent episode, I brought on Jeremy Watson, CEO of Bedrock Investment Property, who’s been investing since 2006, has helped buy and sell 5,000+ properties, and has lived through enough market cycles to know that the “safe” investments people rely on can become dangerous when the economic climate changes.

And that’s exactly what this episode is about: why the bond market matters, why most people don’t understand the risks, and why single-family real estate can look even stronger when bonds start breaking down.

Jeremy’s 2006–2008 Lesson: Everyone Gets Humbled Eventually

Jeremy started investing in real estate in 2006. If you were around back then, you know what happened next.

The 2008 crash didn’t just hurt a few careless investors it humbled almost everyone.

Jeremy shared that they lost money, sold properties at losses, and had to rebuild. That experience pushed him into a decade-long detour in the financial advice world. And that decade turned out to be one of the biggest advantages he could’ve gained because it gave him an insider view of what people actually experience over 10, 20, and 30 years of investing.

Not the marketing version. The real version.

The Dirty Secret of “Passive” Real Estate

Before we even hit bonds, we talked turnkey real estate and why it gets attacked so much today.

Here’s the truth: turnkey isn’t automatically bad. Bad turnkey is bad.

Jeremy told a story that perfectly explains the problem: a client bought a $53,000 turnkey house in Detroit with a pro forma claiming $900/month rent. The neighborhood was full of boarded-up homes, tenants wouldn’t stay, evictions stacked up, and the whole investment became a nightmare.

That’s what happens when turnkey is treated like a product instead of an investment.

And then there’s the admin side nobody talks about.

Most people are sold on the idea that, “You just hire a property manager and it’s passive.”

But if you own rentals, you already know:

Property managers don’t set up your LLC

They don’t keep your books

They don’t manage insurance claims

They don’t handle compliance across states

They don’t hold themselves accountable

If you’re not careful, “passive income” turns into a part-time admin job. I’ve lived this firsthand. Even tracking one rental properly is work. Add multiple properties and you’ve got a bookkeeping problem whether you like it or not.

Jeremy’s point was simple: turnkey can work, but only when the front-end vetting is solid and the backend systems actually exist to make it manageable.

Now Let’s Talk Bonds (Because This Is the Part Nobody Covers)

Here’s why this matters. Most retirement planning is built on modern portfolio theory: Stocks when you’re young. Bonds when you’re old.

The basic story is: when you retire, shift into “safe” assets like bonds so you can protect your money.

Jeremy’s argument is that this can be dangerously incomplete because bonds can become a trap under inflation.

Why Inflation “Tears the Face Off” Bonds

A bond is basically an IOU:

You lend money (face value)

You receive a fixed interest rate

It’s locked for a term (10 years, 20 years, etc.)

That sounds safe. Until inflation rises.

If you lock in a bond paying 5% and inflation rises to 10%, your money is losing purchasing power. You’re earning interest, but you’re still falling behind in real terms.

And it gets worse if you need liquidity.

Because if new bonds are paying 10%, nobody wants your 5% bond unless you discount the price. That means you can take major losses selling bonds before maturity.

That’s the part most people don’t get: bonds can look stable until the moment you’re forced to sell at the wrong time.

Why Real Estate Can Win When Bonds Start Losing

This is where real estate becomes even more interesting.

Jeremy explained why single-family real estate with a long-term fixed mortgage is a powerful hedge in inflationary conditions:

Your mortgage payment stays fixedIf you lock a 30-year fixed loan, the bank doesn’t raise your payment because inflation rose.

Rents can rise with inflationOver time, rents generally adjust upward with the cost of living.

Asset values can rise with inflationReal estate tends to inflate over long periods because the dollar loses value.

So you’re in a position where:

Income can rise

asset value can rise

debt stays fixed

That combination is hard to beat.

“But What If We Go Deflationary?”

This is the fair question. People worry about job losses, reduced spending, rent softness, and housing declines.

And yes some markets have softened. We’ve seen it.

But Jeremy’s response was important: real estate is a long-term macro bet. If you’re buying to flip in 6 months, you’re in a different game. But if you’re buying to hold and cash flow, what matters is supply, demand, and stability.

And we’re still short millions of housing units nationally.

Even if there’s short-term turbulence, long-term housing demand doesn’t disappear. People still need a place to live.

The Bigger Takeaway: Choose Assets That Behave Well in the Environment You’re Entering

This is what I want you to walk away with:

Most investors don’t think in terms of environment.

They hear, “Bonds are safe,” and they accept it.

They hear, “Real estate is risky,” and they avoid it.

But safety depends on context.

Bonds can be safe in one environment and destructive in another. Real estate can be volatile in the short term but resilient in the long term when structured right.

Final Thought

If you’re serious about becoming work optional and building lasting freedom, you can’t afford to just follow default advice.

You need to understand:

what you own

why it behaves the way it behaves

and what happens when the economic environment shifts

Because the game changes when inflation shows up. And the people who understand that ahead of time don’t just survive they position themselves to win.

Jeremy Watson’s links: