Buy land or housing is the best way to support the inflation

Due to the circumstances in the economy given by the health crisis of Covid-19, many investors sought to focus on diversifying its capital in real estate, as many financial markets were affected by the global crisis.

As compared to other assets that are suffering the consequences of rising inflation in the country, the real estate sector is one of the assets that better tolerate the increase in prices.

What is inflation?

We can define inflation as the increase in widespread and sustained the prices of the products and services in a particular period of time. This increase causes the value of money decreases, that is to say that in comparison with what could be bought in the past with a certain amount of money, this would not be enough in a later period. This is also known as the handicap.

It is common to have heard a family member say that before with a certain amount of money they were able to acquire a large amount of assets, which today is not enough for almost nothing. Although land prices are no longer the same as it used to be in the past, still remains an option of affordable investment that provides certain benefits, such as:

Characteristics of inflation

Know the characteristics they possess the inflation allows you to identify them and be able to create financial strategies to perform movements in order to protect your money from the price rise.

Some most important features are:

Types of inflation

Inflation can be classified into several types that can be summed up in:

Inflation by consumption:

When the demand grows faster than supply, which generates the productive sector is not able to adapt and, by consequence, prices rise.

Inflation by cost:

It occurs thanks to the price increase in raw materials, which makes it necessary to raise the price of the products, if you want to maintain a certain line of profits.

Real estate investments to deal with inflation

The properties are also affected by inflation because, with the rise of the prices in construction materials, the costs of production increase as well as the final product. An option used by the owners of the properties in the lease is to include clauses in the contract set out the possibility of adjusting the price of the rental according to the inflation.

In terms of mortgage, some banks have to adjust to the financial policies of the state, which can hinder access to credit to the people who rely on this form of funding to secure a property.

Investing in real estate in times of crisis, such as buying a piece of land for an industry or a commercial field, it is always a good option. This is because, although prices rise at the same time, the value of the properties you own will increase simultaneously. It's a foolproof way to protect your money from inflation.

The earth does not decrease with the passage of time, anger increasing its value according to the rate of inflation, so that your money will always have a greater value, in addition to maintain properties in your cartería as a heritage to the family and to ensure a withdrawal relaxed.

Some tips for investing in land or housing in times of inflation

Choose the areas correct:

A good urbanization should be located in a strategic location and convenient. It is best to look for areas close to main avenues, commercial spaces, schools, etc, While most spaces offer a development, it will be more attractive to live and be a better investment.

Looking for different alternatives:

Before you make a decision, looking for options. Make sure that the urbanization that these evaluating has the backing of a real estate reliable that it has the necessary authorization to carry out the project.

Request studies of soils and risks:

These studies are necessary for you to have a soil quality, an indispensable factor for the value of the property and its safety. Checks that have been done to mitigate the identified risks.

Build a safe shelter:

A good home must be made with a strong foundation and good construction techniques. Find out with professionals in the topic, as it will be a guarantee that your home will be a good investment by providing the security that it deserves. A good construction plan done by professionals can help you save time and money.