Why is real estate your best hedge against inflation?
Back in December 2021, the National Association of Realtors said that inflation had gone up to 7%. By January 2022, it had risen to 7.5%. Sounds pretty catastrophic, right? So what can you do to safeguard yourself against its effects?
Well, you can start by investing in real estate as a hedge against inflation. Real estate is one of the few investments where the appreciation of the asset actually outpaces inflation.
Inflation was on the rise as 2021 closed out, but at the same time, home prices were up by 18% year over year. If you have rental properties, remember that as house prices go up, so too will your rents. That means you could pay off your rental properties faster. If you recently bought a house and you’re worried about inflation, just keep in mind that your equity is going up at a record pace. That sounds like a pretty good hedge to me!
If you have any questions about your home or rental properties, or if you like to learn more about investing for your future, don’t hesitate to give us a call or send us an email. We’d love to help you.