How Homeownership Can Help Shield You from Inflation
Hey Friends, if you’re following along with the news today, you’ve likely heard about rising inflation. It has been more noticeable the last couple of weeks. You’re also likely feeling the impact in your day-to-day life as prices go up for gas, groceries, and more. We’ve seen it happening all over our North Alabama area, and as a Realtor driving through town daily I am also a witness of it. These rising consumer costs can put a pinch on your wallet and make you re-evaluate any big purchases you have planned to ensure they’re still worthwhile. Won’t you agree with that?
Friends, if you’ve been thinking about purchasing a home this year, you’re probably wondering if you should continue down that path or if it makes more sense to wait. While the answer depends on your situation, here’s how homeownership can help you combat the rising costs that come with inflation.
Did You Know That Homeownership Offers Stability and Security?
Friends, Investopedia explains that during a period of high inflation, prices rise across the board. That’s true for things like food, entertainment, and other goods and services, even housing. Both rental prices and home prices are on the rise. So, as a buyer, how can you protect yourself from increasing costs? The answer lies in homeownership.
This is one main thing to think about: Buying a home allows you to stabilize what’s typically your biggest monthly expense: your housing cost. If you get a fixed-rate mortgage on your home, you lock in your monthly payment for the duration of your loan, often 15 to 30 years. James Royal, Senior Wealth Management Reporter at Bankrate, says:
“A fixed-rate mortgage allows you to maintain the biggest portion of housing expenses at the same payment. Sure, property taxes will rise and other expenses may creep up, but your monthly housing payment remains the same.”
So even if other prices rise, your housing payment will be a reliable amount that can help keep your budget in check. If you rent, you don’t have that same benefit, and you won’t be protected from rising housing costs. I am completely ready to walk you through the math behind this to help you make a more educated decision on your real estate purchase.
Did You Know That You Can Use Home Price Appreciation to Your Benefit?
Don’t panic! While it’s true rising mortgage rates and 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. Buying your real estate property now lets you lock in at today’s rates and prices before both climb higher. All of our clients in the Huntsville Metro Area and throughout the North Alabama are experiencing this, you are not alone!
In inflationary times, it’s especially important to invest your money in an asset that traditionally holds or grows in value. The graph below shows how home price appreciation outperformed inflation in most decades going all the way back to the seventies – making homeownership a historically strong hedge against inflation (see graph below):

Homeownership, Inflation, John Wesley Brooks Real Estate
So, what does that mean for you? Today, experts say home prices will only go up from here thanks to the ongoing imbalance in supply and demand. Once you buy a house, any home 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 (even in inflationary times), you have peace of mind that history shows your investment is a strong one. Feeling better my friend?
Wondering What Is The Bottom Line?
If you’re ready to buy a home this year anywhere in our North Alabama, it may make sense to move forward with your plans despite rising inflation. If you want expert advice on your specific situation and how to time your purchase, let’s connect today. I would love to have the opportunity to serve you and your loved ones during your real estate transaction!
Remember, when you work with John Wesley Brooks and The Brooks Family Of Realtors, you are working with a generational real estate family that has been serving our North Alabama and Tennessee Valley since 1972!