By now you have more than likely felt the financial impact of inflation in your everyday life, with the current cost of groceries, gas, etc. consistently increasing. As necessities become more and more expensive, many people are reevaluating their current spending. If you have been contemplating buying a home lately, you may be wondering if it is the right time due to the recent economic trends, but did you know that home ownership can actually help to curb high costs caused by inflation? If you have questions about buying a home in Knoxville, Maryville, Lenoir City, Oak Ridge, or Gatlinburg, Tennessee, and are wondering about the implications of the current market, Foundation Mortgage can help. Read on to learn about how owning a home can protect you from inflation.
Real Estate: A Hedge Against Inflation
Inflation is currently causing prices to be more expensive in pretty much every aspect of everyday life, including services and goods, food, entertainment, and housing. One thing that can actually help you protect yourself from these rising prices is investing in real estate because owning a home helps your housing costs remain steady, which can be one of your largest expenses. If you apply for a fixed rate mortgage to help you buy a home, and are able to secure a monthly payment for a term of 15 to 30 years, your housing payment will remain consistent and that can help you budget reliably. Conversely, renting will not offer that same advantage because renters are not protected against increasing housing costs.
Increasing Home Value
Even though it will be more expensive to purchase a home in today’s inflationary economy, home buyers have the opportunity to set themselves up for long term success. Real estate assets become more valuable over time, therefore, it is a good idea to invest in a property during inflation. With home prices likely to increase even higher, if you are able to lock in a home at the current rate, the value of your home is likely to grow in the future. Inflation could mean more cash for mortgage borrowers because once you purchase a property, when your home price appreciates, your home equity and your net value will also increase.
What Is The Bottom Line?
If you are deciding whether it is the right time to purchase a home, it could be beneficial to proceed with the home buying process now, even during inflation. If you have been contemplating purchasing a home in Knoxville, Maryville, Lenoir City, Oak Ridge, or Gatlinburg, Tennessee, and have questions about the real estate market during inflation, contact Foundation Mortgage today for a consultation.