In these days of increased inflation (I almost said hyperinflation, but thought I should check the definition on that...apparently that's inflation above 50%...good reality check) many folks are trying their best to hold on to what they have. Cash is a poor reserve of wealth when dollars are buying less and less, and some of our knee-jerk ideas like buying gold just don't hold up to scrutiny. (It worked in the 1970's....not since.)
For savvy investors few inflationary hedges are better than income real estate, and there are a few reasons for that. The first, when talking about residential real estate, is that rents have historically kept up with inflation. That's important because when you're valuing duplexes, triplexes, quadplexes, and apartments, what they are worth in any market is based on what they rent for. Unlike single-family homes, these products are sold on a gross-rent multiplier or cap rate. When rents go up, value goes up.
To illustrate inflation vs rent, allow me to borrow the excellent graph from Nuveen with all credit and gratitude given.
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