Use Home Price Appreciation To Your Benefit While it’s true rising home prices mean buying a house today costs more than it did a year ago, you still have an opportunity to set yourself up for a long-term win by locking your payment in at today’s rates and prices. During inflationary times, it’s especially important to invest your money in an asset that will hold or grow in value. The graph below shows how home price appreciation outperformed inflation in most decades going all the way back to the 1970s ( see graph below ):
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%
3.0%
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 to buy a home, it may make sense to move forward with your plans despite rising inflation. To make sure you have expert advice on your specific situation and how to time your purchase, let’s connect. So, what does that mean for you? Once you buy a house, any price appreciation that does occur will be good for your equity and your net worth. And since homes are typically assets that grow in value, you have peace of mind that history shows an investment in homeownership is a strong one.
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