Single Family Rentals are a great hedge against inflation

Cash being paid to landlord as part of rentals to hedge against inflation

Investors are repeatedly weighing if rentals are a great hedge against inflation. As reported everywhere, inflation is spiraling out of control. In Februry 2022, the CPI is 8% higher than it was a year ago – in February 2021. This makes inflation at it’s highest rate in 40 years. Investors are increasingly turning to real estate to hedge against inflation and volatility in the stock market. Single family residential real estate should be the main focus of small time investors.

Sales last year saw for single family residential real estate in Florida saw an almost 20% jump in prices – well above the high inflation numbers. With many other investment opportunities such as the stock market and crypto assets experiencing volatility or declining, many people are turning to real estate. Home prices more than tripled in most areas in Florida since the financial crash. In addition to appreciation, most expenses including mortgages are covered by the rental payments for investors.

Single family rentals have consistent monthly returns and appreciation potential. Additionally, due to IRS guidelines, a lot of the cashflow is tax-free. Due to these multiple advantages, real estate rentals are a great hedge against inflation during volatile times and high inflation.