Here’s how high inflation can actually be good for homeowners.
Inflation has been in the news a lot lately. The subject generally carries a negative connotation because it causes the cost of goods to increase. However, when it comes to real estate, inflation isn’t necessarily a bad thing.
Investing in real estate is actually a great way to hedge against inflation since it usually causes home prices to rise. If you own a home with a mortgage, your monthly payment is fixed. However, the value of your home rises in equity based on market conditions. This is not true for renters. During high inflation, rent tends to increase at a higher rate.
Is inflation bad for real estate? The answer is that it depends. It can be positive for property owners but problematic for prospective buyers. Based on the news, the prices of homes and the cost of building materials will continue to rise, so the sooner a buyer can find a house, the better.
If you have any questions about buying, selling, or real estate in general, don’t hesitate to reach out via phone or email. I look forward to hearing from you soon.
