History Shows During Inflationary Periods, Home Prices Rise Too As an added plus, history indicates your next home will likely grow in value with time. Mark P. Cussen, Financial Writer at Investopedia, explains: “ Real estate is one of the time-honored inflation hedges. It's a tangible asset, and those tend to hold their value when inflation reigns, unlike paper assets. More specifically, as prices rise, so do property values.” To help give you more context, here’s a look at how home prices have performed compared to inflation since the 1970s. When prices rise, the value of your home does too. And when you’re looking to protect yourself from rising costs, you want to be in a fixed asset that typically outperforms the rate of inflation. As history shows, that makes buying your next home a great hedge during periods of high inflation.
Homeownership: a Hedge Against Inflation Home Price Appreciation vs. Consumer Price Increases Over the Decades
15%
Inflation Rate
Home Price Appreciation
9.9%
9.2%
7.1%
7.0%
5.6%
5.5%
4.9%
4%
3%
2.6%
2.3%
1.8%
1.4%
1970s
1980s
1990s
2000s
2010s
2020
2021
Source: NAR, CoreLogic, Consumer Price Index
Bottom Line If you’re ready, moving sooner rather than later will put you in the best position to gain from your next investment. Let’s connect if you want to better understand how moving into your dream home could be a great long-term decision.
17
Made with FlippingBook Learn more on our blog