Owning a Home Helps Protect Against Inflation

Shot of a young couple working on their finances together at home
May 25, 2023 10:15 AM

by: Security First Financial, A Division of Primary Residential Mortgage, Inc.

You’re probably feeling the impact of high inflation every day as prices have gone up on groceries, gas, and more. If you’re a renter, you’re likely experiencing it a lot as your rent continues to rise. Between all of those elevated costs and uncertainty about a potential recession, you may be wondering if it still makes sense to buy a home today. The short answer is – it does. Here’s why.


Homeownership actually shields you from the rising costs inflation brings.


Freddie Mac explains how: 


“Not only will buying today help you begin to build equity, a fixed-rate mortgage can stabilize your monthly housing costs for the long-term even while other life expenses continue to rise – as has been the case the past few years.”


Unlike rents, which tend to rise with time, a fixed-rate mortgage payment is predictable over the life of the mortgage (typically 15 to 30 years). And, when the cost of most everything else is rising, keeping your housing payment stable is especially important.


The alternative to homeownership is renting – and rents tend to move alongside inflation. That means as inflation goes up, your monthly rent payments tend to go up, too (see graph below):



A fixed-rate mortgage allows you to protect yourself from future rent hikes. With inflation still high, when your rental agreement comes up for renewal, your property manager may decide to increase your payments to offset the impact of inflation. Maybe that’s why, according to a recent survey, 73% of property managers plan to raise rents over the next two years.


Having your largest monthly expense remain stable in a time of economic uncertainty is a major perk of homeownership. If you continue to rent, you don’t have that same benefit and aren’t as protected from rising costs.


Bottom Line


A stable housing payment is especially important in times of high inflation. Let’s connect so you can learn more and start your journey to homeownership today.



*The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. Primary Residential Mortgage, Inc and Keeping Current Matters, Inc. do not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. Primary Residential Mortgage, Inc and Keeping Current Matters, Inc. will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.


Bard. (2023, May 03). Residential Vacancies and Homeownership in the United States: First Quarter 2023. Retrieved from https://www.census.gov/housing/hvs/files/currenthvspress.pdf

Freddie Mac. (2023, April 18). Should inflation change your homebuying plans? My Home by Freddie Mac. Retrieved from https://myhome.freddiemac.com/blog/homebuying/should-inflation-change-your-homebuying-plans

U.S. Bureau of Labor Statistics. (2023, May 25). Consumer Price Index for All Urban Consumers: Rent of Primary Residence in U.S. City Average. FRED, Federal Reserve Bank of St. Louis. Retrieved from https://fred.stlouisfed.org/series/CUUR0000SEHA

US Inflation Calculator. "United States Core Inflation Rates (1957-2020)." Accessed May 25, 2023. https://www.usinflationcalculator.com/inflation/united-states-core-inflation-rates/

Buildium Staging. (2023). 2023 Property Management Industry Report. Retrieved from https://www.buildiumstaging.com/resource/2023-property-management-industry-report/

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*Opinions expressed are solely my own and do not express the views of my employer.