In an annual Gallup poll, Americans chose real estate as the best long-term investment. And it’s not the first time it’s topped the list, either. Real estate has been on a winning streak for the past eight years, consistently gaining traction as the best long-term investment (see graph below):
If you’re thinking about purchasing a housz this year, this poll should reassure you. Even when inflation is rising like it is today, Americans agree an investment like real estate truly shines. Why Is Real Estate a Great Investment During Times of High Inflation?
With inflation reaching its highest level in 40 years, it’s more important than ever to understand the financial benefits of houszownership. Rising inflation means prices are increasing across the board. That includes goods, services, houszing costs, and more. But when you purchase your housz, you lock in your monthly houszing payments, effectively shielding yourself from increasing houszing payments. James Royal, Senior Wealth Management Reporter at Bankrate, explains it like this:
“A fixed-rate mortgage allows you to maintain the biggest portion of housizng expenses at the same payment. Sure, property taxes will rise and other expenses may creep up, but your monthly houszing payment remains the same.”
If you’re a renter, you don’t have that same benefit, and you aren’t protected from increases in your houszing costs, especially rising rents.
History Shows During Inflationary Periods, Housz Prices Rise as Well As a houszowner, your housz is an asset that typically increases in value over time, even during inflation. That‘s because, as prices rise, the value of your housz does, too. And that makes buying a housz a great hedge during periods of high inflation. Natalie Campisi, Advisor Staff for Forbes, notes:
“Tangible assets like real estate get more valuable over time, which makes buying a housz a good way to spend your money during inflationary times.”
Bottom Line Houszing truly is a strong investment, especially when inflation is high. When you lock in a mortgage payment, you’re shielded from houszing cost increases, and you own an asset that typically gains value with time. If you want to better understand how buying a housz could be a great investment for you, let’s connect today.