How Real Estate Can Hedge Against Inflation
Inflation is one of the great real estate investor’s best friends.
While most people think of inflation as something that just makes things more expensive, it can also be a powerful force that helps drive up real estate values.
That’s because, over time, real estate gains value at a rate that’s higher than the rate of inflation. So, if you’re investing in real estate for the long term, you’re essentially hedging against inflation.
- Real estate has historically gained value at a higher rate than inflation
- Owning a home or property is a physical asset that can’t be devalued, unlike a car
- You can build up equity in your home
List reasons why real estate protects against inflation:
Historically, real estate has gained value at a rate that’s higher than the rate of inflation.
There’s no doubt about it: real estate has been a solid investment for centuries. In fact, many experts believe that real estate is one of the best long-term investments out there. And it’s not hard to see why. Historically, real estate has gained value at a rate that’s higher than the rate of inflation. This means that real estate is a great way to preserve your wealth and grow your assets over time. Of course, there are always risks associated with any investment, but if you’re looking for a safe and stable place to grow your money, real estate is definitely worth considering.
Real estate is a physical asset that can’t be devalued by inflation.
Investing in real estate is a smart way to protect your assets against inflation. Unlike stocks and bonds, real estate is a physical asset that can’t be devalued by inflation. In fact, real estate usually increases in value as inflation goes up. This makes real estate an ideal investment for people who are looking to preserve their wealth during periods of high inflation. So if you’re worried about the effects of inflation, remember that real estate is a great way to safeguard your assets.
Real estate provides a hedge against other investments that may lose value during periods of high inflation.
While there’s no sure way to protect your investments against inflation, real estate has historically been a reliable hedge. As real estate values appreciate, the equity in your home can provide a buffer against other investments that may have lost value. Of course, real estate isn’t immune to inflationary forces—property taxes and maintenance costs typically increase along with the cost of living. But over the long term, real estate has proven to be a relatively safe investment, even during periods of high inflation.
Investing in real estate can help you keep up with the cost of living, even as prices rise.
As the cost of living continues to rise, it can be difficult to keep up with the Joneses – or even maintain your current lifestyle. But there is one tried-and-true way to beat the rising cost of living: real estate investment. Over time, real estate typically increases in value, meaning that your investment will likely grow along with the cost of living. In addition, real estate can provide a steady stream of income through rentals, helping you to keep pace with increasing prices. For instance, you can try out house hacking, whereby your home actually makes you money in the long run.
If you’re looking for a safe and profitable investment, real estate is a great option. With its ability to protect against inflation, real estate is an investment that will continue to pay off for years to come.
Of course, there are other factors that affect real estate values – such as interest rates and the overall economy – but inflation is one of the key drivers.
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in this series Inflation & The Housing Market
- A Guide to How Inflation Influences Interest Rates next read
- How Real Estate Can Hedge Against Inflation currently reading
- Why Inflation Numbers Don’t Reflect the Housing Market next read
- How to Prep for a Recession in 2023 next read
- What is a Housing Bubble and are We in One? next read
- Will the Housing Market Crash in Canada? next read
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