It feels like everything is getting more expensive these days. That’s because inflation has remained higher than expected for an extended period, driving up the costs of goods, services, and housing. With prices rising all around you, you may be wondering: Is now really the right time to buy a home?
Homeownership Protects You from Inflation
The good news? Owning a home is actually one of the best ways to safeguard yourself against inflation’s impact.
A Fixed-Rate Mortgage Shields You from Rising Housing Costs
One of the biggest advantages of homeownership is payment stability. When you purchase a home with a fixed-rate mortgage, your principal and interest payments remain steady over time. While property taxes and insurance may fluctuate, your largest housing expense stays predictable—no matter how inflation shifts.
The same can’t be said for renting. Rents tend to increase over time, often outpacing inflation. Data from the Bureau of Economic Analysis (BEA) and the Census Bureau show just how much rental costs have surged in recent years (see graph below):
So while renters face higher costs year after year, homeowners with a fixed mortgage rate lock in their monthly payments, making it easier to budget—regardless of inflation.
Home Prices Typically Outpace Inflation
Another reason homeownership is a powerful hedge against inflation is home appreciation. Historically, home values tend to rise over time—often at a rate that outpaces inflation. Data from the BEA and Fannie Mae reinforce this trend (see graph below):
This makes real estate one of the strongest long-term investments, especially during periods of rising prices. Unlike cash savings, which lose value as inflation erodes purchasing power, real estate generally holds or gains value, helping homeowners build wealth.
Renting, on the other hand, offers no protection. When inflation drives up costs, landlords typically pass those increases onto tenants through higher rent. That means renters pay more over time without any financial benefit. In contrast, homeowners not only secure a predictable housing payment but also benefit from rising property values, growing their equity over time.
With experts predicting continued home price appreciation, homeownership remains a solid investment that typically outperforms inflation in the long run.
The Bottom Line
Inflation makes everyday expenses unpredictable, but owning a home provides stability. Unlike rent, your mortgage payment stays relatively fixed, and the value of your home is likely to increase over time.
How would having a predictable housing payment change the way you plan for your financial future?
