There are many reasons that folks are concerned about the national debt, but have you thought about how it impacts your housing choices? Your first reaction might be that with the economy remaining less than robust, conservative financial choices are your best and safest bet. These economic times have seen people scaling back, and many have opted for smaller homes and rentals, preserving their cash, unsure where the market is headed.
Such an approach may not, however, be your best bet. In the long run, you may be better off buying as much house as you can comfortably afford. Sound risky? You may be risking more to play it safe.
If our nation cannot resolve its debt issues, economists predict that we may enter a period of inflation and high interest rates. If this happens, your home should keep pace with inflation while other assets may not. If you have more invested in your home as a “place holder” you can rest assured that your net worth is not losing ground as prices skyrocket around you. Of course, there is no better time to invest in your “place holder” than when the cost of borrowing is low. With interest rates as low as they are today, regardless of the uncertainty that some fear lies ahead of us, there is simply no better time than to be choosing real estate as your hedge against inflation. And while some investors may enjoy watching their investments grow on paper, your home is the only investment you can come home to every day and enjoy with family and friends. So invest in real estate with confidence — not only can you buy more for less right now, but you can actually enjoy your investment for years to come.