Reasons You should Still Buy a Home even with High Inflation

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Despite what you may have heard, the housing market is still a good investment. Here are five reasons why:

Interest rates are low.

Interest rates are low. In fact, the average interest rate on a 30-year mortgage is at 3.86%. This means you can afford a much larger mortgage than you could a few years ago!

Inflation isn’t always bad.

Inflation is a good thing for borrowers. Inflation means that your dollars are worth less and you need more of them to buy what you want. This is great news!

  • Buyers: When inflation rises, it means that the prices of homes (your house) increase as well. A higher rate of inflation means that houses can be purchased cheaper with each passing year. So even though inflation may be high today, this will eventually lead to lower house prices in the future as well as making your home’s value go up over time if you choose to sell it at some point in the future.
  • Sellers: If someone buys your house today and then sells it tomorrow with inflated values because they have high rates of inflation annualized over them (which is what happens), then they could end up making quite a killing profit by buying cheap now and selling expensive later on when there’s no more room left in their budget

You aren’t buying a house for the short term.

The point of buying a house is to make it your home. It’s not just an investment, it’s where you live—and live well. You get to choose the paint colors and fixtures, create the furniture arrangements…paint a mural in one room if you like! Your home should be a reflection of who you are as an individual and what matters most to you as part of your lifestyle.

Buying a house isn’t just about saving money on rent; it’s about investing in yourself (and your future). What will that look like for you exactly? Let’s talk about some reasons why buying a home can still make sense even with high inflation:

Inflation might actually help your home be more valuable in the long term.

Inflation might actually help your home be more valuable in the long term.

Inflation increases the value of your home. Inflation helps your home retain its value, by keeping it from decreasing too rapidly. It can also help it appreciate over time if you’re able to stay ahead of inflation, or at least avoid negative rates of return on your investment.

This might sound like a bizarre claim, but there’s some logic behind it: The government-controlled rate of inflation—the Consumer Price Index (CPI)—is calculated using a basket of goods and services that includes things like housing costs, energy bills and food purchases; if these go up in price over time due to inflationary pressures then so does the CPI itself! This means that as long as you don’t sell your house for less than what you paid for it originally, then its value will go up over time.

It’s still smart to buy a house even with inflation happening.

You may be worried about the high inflation rates, and for good reason. High inflation can be a huge problem and make it much harder to buy a house, but you need to remember that there are still many benefits of buying a home even with high inflation happening.

One way that you can avoid losing money in this situation is by considering these factors:

  • Buy something that you want rather than something that is more affordable. The more expensive your home is, the less likely it will be worth less over time. This means that if your goal is to purchase something as cheaply as possible right now, then maybe waiting until after the economy gets better isn’t such a bad idea after all!

The bottom line is that buying a house is still a smart move even with inflation happening. In fact, the last thing you want to do is get caught up in short-term thinking about the home market. While there are some potential pitfalls of buying at this time, it’s important to remember that you’re not just thinking about your next five years—you’re also investing for your future as well as your family’s future. If you are ready to start the journey of homeownership, give us a call or text today at 616-550-7686. We look forward to serving you!

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