Real estate has lasting value that brings both short and long term gains
In the annual poll conducted by Gallup news, Americans chose real estate as the best long-term investment. It is no surprise that it is not the first-time real estate has bagged the top spot. Real estate has been the top choice for the past eight years as the best long-term investment.
Experts believe that even with rising inflation, real estate remains a great investment option and that shows in the poll results as well. In fact, owing to the rising inflation, it may make more sense for people who rent a house to invest in a house of their own.
At a time when inflation figures are hovering at an all-time high, prices are increasing across the board. The U.S. Bureau of Labor Statistics has reported that inflation in the United States hit a 40-year high in January. It was also reported that the consumer price index (CPI) in January was 7.5% higher than it was during the same period in the previous year. Also, he official US annual inflation rate rose to 7 percent in December and by another 7.5 percent in January, marking the highest month-on-month increase since February 1982.
These facts highlight the importance of understanding the financial benefits of homeownership at a time when costs of goods, services, housing, and everything else are increasing. When you purchase a house, you not only shield yourself from increasing rental payments, but you also lock-in your housing payments. With a fixed rate mortgage, you can maintain your monthly housing expenses at the same level. Moreover, your investment will grow over time, especially during a period of inflation, when prices of everything are increasing.
In another survey, which was conducted by Bankrate in 2019, it was asked, “For money you wouldn’t need for more than 10 years, which ONE of the following do you think would be the best way to invest it?” The options provided were real estate, cash investments, stocks, gold, cryptocurrency, and others.
It was concluded, “years after the housing crash that left the economy hurting, many Americans still see real estate as their top pick”. In this national level survey, 31 percent of respondents had named real estate as their preferred investment for money that they wouldn’t need for 10 years or more.
In the same study it was noted that Millennials scored the highest among all age groups studied in their preference for real estate as a long-term investment. Generation X was next, with baby boomers a close third and the silent generation the fourth.
In the nutshell, real estate is a great investment, particularly when inflation is high. When you purchase a home and lock in a mortgage payment, you are safe against housing cost increases and your asset value increases with time.
If you have been thinking of investing in real estate, but you are skeptical or you need to understand the process better, please get in touch with us. We will guide you through the entire process and help you purchase a property that meets your investment goals and offers the best possible ROI.