Should You Still Buy a Home with the Latest News About Inflation?

While the Federal Reserve is working hard to bring down inflation, the latest data shows the inflation rate is still high, remaining around 8%. This news impacted the stock market and added fuel to the fire for conversations about a recession.

You’re likely feeling the impact in your day-to-day life as you watch the cost of goods and services climb. The pinch it’s creating on your wallet and the looming economic uncertainty may leave you wondering: “should I still buy a home right now?” If that question is top of mind for you, here’s what you need to know.

Homeownership Is Historically a Great Hedge Against Inflation

In an inflationary economy, prices rise across the board. Historically, homeownership is a great hedge against those rising costs because you can lock in what’s likely your largest monthly payment (your mortgage) for the duration of your loan. That helps stabilize some of your monthly expenses. James Royal, Senior Wealth Management Reporter at Bankrateexplains:

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.”

And with rents being as high as they are, the ability to stabilize your monthly payments and protect yourself from future rent hikes may be even more important. Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), explains what happened to rents in the latest inflation report:

“Inflation refuses to budge. In September, consumer prices rose by 8.2%. Rents rose by 7.2%, the highest pace in 40 years.”

When you rent, your monthly payment is determined by your lease, which typically renews on an annual basis. With inflation high, your landlord may be more likely to increase your payments to offset the impact of inflation. That may be part of the reason why a survey from realtor.com shows 72% of landlords said they plan to raise the rent on one or more of their properties in the next year.

Becoming a homeowner, if you’re ready and able to do so, can provide lasting stability and a reliable shelter in times of economic uncertainty.

Bottom Line

The best hedge against inflation is a fixed housing cost. If you’re ready to learn more and start your journey to homeownership, let’s connect.

88 Properties
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4
Beds
3F11/2
Baths
4,150
Sq.Ft.
2011
Year Built
42
Days on Site
24018339
MLS
4
Beds
3F11/2
Baths
6,274
Sq.Ft.
2005
Year Built
28
Days on Site
24021384
MLS
$1,225,000
Neighborhood: Flowers Mill
5
Beds
4F11/2
Baths
5,565
Sq.Ft.
1995
Year Built
63
Days on Site
24014656
MLS
$1,199,000
Neighborhood: The Townhomes At Southshore
3
Beds
3F11/2
Baths
2,852
Sq.Ft.
2020
Year Built
304
Days on Site
23027521
MLS
$1,190,000
Neighborhood: Felkers High Pines Lakeshore Development
3
Beds
2
Baths
2,005
Sq.Ft.
1964
Year Built
44
Days on Site
24017811
MLS
3
Beds
2
Baths
2,180
Sq.Ft.
1979
Year Built
154
Days on Site
23145867
MLS
3
Beds
2
Baths
1,734
Sq.Ft.
1920
Year Built
48
Days on Site
24016784
MLS
$999,999
Neighborhood: Horners Woods
4
Beds
4
Baths
4,105
Sq.Ft.
2003
Year Built
43
Days on Site
24018314
MLS
$994,000
Neighborhood: Wilderness Ridge
5
Beds
3F11/2
Baths
3,828
Sq.Ft.
2002
Year Built
56
Days on Site
24015891
MLS
3
Beds
3F11/2
Baths
3,488
Sq.Ft.
2015
Year Built
45
Days on Site
24017036
MLS
6
Beds
3F11/2
Baths
4,240
Sq.Ft.
2018
Year Built
21
Days on Site
24022868
MLS
6
Beds
3F11/2
Baths
4,264
Sq.Ft.
2005
Year Built
15
Days on Site
24024013
MLS

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