Should You Buy a Home During High Inflation?
With inflation reaching a high that we haven't seen for quite some time, many people are cutting back on their spending. But for those of us who are shopping for homes and have cash on hand for a down payment, that doesn’t mean we need to put our dream home on the back burner until things look better!
Periods of high inflation like these create a ton of opportunities! Here are three reasons why you should buy a home during high inflation:
Spike in interest rates is influencing the housing market
While inflation may be at an all-time high, the Fed is working to bring it down. A direct result of that is that the real estate market is FINALLY starting to cool down.
So if you’re in the market for buying a home, you’re in luck! The supply of homes is at the highest it’s been since spring 2020 and the prices are coming down as well.
These two things paired together make it a lot easier to snag up a home - most homes are spending a lot more time on the market and have way fewer competing offers on them.
Appreciation of real estate never stops
While some homes have acquired way too much value over a short period (and are quickly losing it), these homes are still worth their fair market value. It’s only being corrected due to the bubble we had from such low-interest rates and homes being in such demand.
Over time, buying a home (or any piece of real estate) is ALWAYS worth it. It’s one of the few investments that are guaranteed to appreciate. And like any other asset, the sooner you get it, the better.
Decrease in home prices
Historically, high inflation usually means that a recession is looming.
While many people, unfortunately, can’t make their mortgage payments anymore due to job losses or interest hikes causing homeowners to no longer be able to afford their mortgages, it does create an opportunity for those who have cash on hand.
That’s because many homes go on the market at a very low cost - sometimes, even under market value - as people are just trying to put a stop to their losses and want to move on as quickly as possible.
So there you have it! While the future of our economy may seem scary right now, there are still plenty of opportunities that exist within it for the buyers who are ready to make an offer.