Inflation & Real Estate

As inflation rises to 6.2 percent – the highest rate since 1990 – an already tight housing market has seen home prices and rents increasing at an alarming rate. What does the future hold?

Many experts see a major part of the problem in supply chain issues. During the pandemic, many services – going out to eat or to the movies, gym memberships, etc. – declined drastically as the demand for goods increased. As we’ve seen, the supply chain has struggled mightily to keep up with this demand and, combined with a shortage of capable or willing workers – prices have skyrocketed in everything from appliances to cars to, yes, homes.

As the supply chain improves, analysts see the prices stabilizing. However, interest rates could increase up to 3.7 percent in 2022 which will hurt buyers.

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