Overnight News: When your account is overdrawn on drama, safety beckons from The Valley of the Ever-Fecund Sun.

We sold a lot of houses, over the past dozen years, by agreeing to do property management on them. We’re small fish by any scale, but I represent a pool of investors – California middle-class, so Arizona rich – and a portfolio of homes.

We bought for resale value, and over the past few years we have been demonstrating the wisdom of that praxis: My guys are making a killing when they cash out, almost always tax-deferred.

This is a note I sent to them this week:

I never want to bet against Phoenix, but we are nevertheless as adept at crashing to the ashes as we are at soaring to the heights. This market last topped out in 2006, and now, 15 years later, we may be hitting the upper limits of where we can go.

This past year killed for appreciation, with three factors driving our price surge:

1. Fear-driven demand, with population growth from both the virus and from unrest elsewhere.

2. Low interest rates and the fear-of-missing-out on them.

3. Currency inflation; by the time all the checks are cashed, the money supply has grown immensely.

Fear is unpredictable, but Texas is blowing us a cold wet kiss just now: They are not energy-secure, but we are. Interest rates are rising now, and inflation invites its own responses.

The point would be that now may be the time to sell, if you have a way of moving to a safer investment – ideally avoiding the capital-gains tax hit.

We have been selling properties by 1031 exchange – moving from one real estate investment to another with the taxes deferred – but your investment advisor can talk to you about moving from real estate into other investments, by way of tax-deferred retirement-investment vehicles.

I’m not chasing you away. We’re selling a tenant-occupied home now, so we’re about to lose our favorite tenants and it’s breaking my heart. But the name of this game is buy-low, sell-high, and now or sometime soon may be the time to sell.

Blue skies in Phoenix, regardless, as always. It may be time to sell, or we may go higher still. But it’s an awful time to be a buyer or a house-hunting tenant, so it is an excellent time to be a seller or a landlord.

If the real estate market is topping out (where, precisely?), it could bleed value slowly for a long time – just as it did from 2006 to 2008. But anything that can’t go on forever won’t, so plan accordingly.

In other news:

Housing Wire: Homebuilders preparing for big 2021, data suggests.

CNBC: Existing home sales rise slightly in January, but record low supply weighs on market.

Housing Wire: Mortgage rates jump to 2.81%.

Southern Living: 105 People Picked Up the Tab of the Car Behind Them at the Pace, Florida, Whataburger Drive-Thru.

The Hayride: At What Point Do We Realize Bill Gates Is Dangerously Insane?

Andrew Torba: It’s Time To Build Our Own Economy.

Michael Anton: The Continuing Crisis: The election and its aftermath.