Real estate hedges for inflation
Real estate has always proven to be a good bet over the long haul with phenomenal appreciation.While inflation may bite into your savings, it could favour people who are under the burden of debt. How does inflation favour property investments? Most investors in property take a land or home loan with tenures typically ranging from five to 20 years. In an inflationary economy, whatever the homeowner needs to pay back to the lender will appear very little. Just as your savings will be worth lesser over a long tenure, so will your debts as your income levels would have soared many times . With banks offering home loans at attractive rates, owing a house is affordable for the young, salaried class.
Real estate stands out as an ideal investment in an inflationary economy, especially for those nearing their retirement. An exposure to real estate amply diversifies an otherwise low-risk investment portfolio of a senior
citizen. Regular rental income from property is a boon for investors apart from overall appreciation in the property price.
citizen. Regular rental income from property is a boon for investors apart from overall appreciation in the property price.
A growing population, migration, and increase in job opportunities and economic activity will increase the demand for housing and subsequently your rental income. Increase the worth of your portfolio and amply diversify with real estate. Identify a value investment with a clear title, in a good neighbourhood. Real estate is a proven hedge against inflation.
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