The inflation situation is potentially risky if you do not choose the right investment channel. Yet it is also an opportunity for potential and market-conscious investors to break through. So let’s learn the best investment channel through the following article.
1. Inflation will cover the economy in 2022
Since the beginning of 2022, with tensions related to the war in Ukraine, the global economy, which has severely damaged the Covid-19 pandemic, has been “tottering”, disrupting its supply chain.
Typically in the US, inflation had skyrocketed since early 2021, when the country’s economy began to recover strongly from the pandemic. US inflation rates in March and April 2022 were 8.5% and 8.3% respectively, both record highs in more than 40 years. In Russia inflation also rose to 17.62%% in April (compared to 9.2% in February). In Vietnam, although the authorities are stepping up measures to prevent inflation and price storms, the economy is still under severe inflationary pressure.
In particular, gasoline prices broke a record of over 30,000 VND/litre at the end of May, leading all other commodities to announce price increases in May, leaving inflation concerns to haunt the economy. According to experts, most sectors of animal husbandry, fishing, construction and retail are heavily affected by the rapid and continuous rise in gasoline prices.
According to economists, inflation erodes profits earned from savings, whether they be cash or fixed-income savings such as bonds. These benefit those who invest in assets or stocks with higher returns and, of course, higher risks. In particular, investing in assets, especially gold and real estate, is still chosen by many investors to “choose to deposit gold”.
2. The Best Investment Channel in the Inflation Period – Real Estate Investments
With inflation on the rise, you can feel it impacting your daily life as prices for gasoline, groceries and more soar. These inflated consumer costs can negatively impact your wallet and make you re-evaluate major purchases you’re planning to make to make sure they’re still worth it.
If you’re considering buying a home this year, you’re probably wondering whether you should continue down that path or whether it’s wiser to wait. While the answer depends on your situation, here’s how to help homeowners fight the rising costs associated with inflation.
1. Home Ownership Helps You Stabilize One of the Most Important Monthly Expenses
With rising inflation, prices are rising across the board, even for housing. Both rents and house prices are rising. So, how can you as a buyer protect yourself against rising costs? The answer lies in home ownership.
By buying a home, you stabilize your most important monthly burden: the housing costs. If you have a fixed-rate mortgage on your home, you lock in the monthly payments for the duration of the loan, usually between 5 and 10 years.
So even if other prices go up, your housing allowance is a fixed amount that can help you keep your budget in check. On the other hand, if you rent, you do not have the same benefits and you are not protected against rising housing costs.
2. Invest in an asset that appreciates more than inflation
While rising house prices and higher mortgage rates mean that buying a home today costs more money than it did a few months ago, you still have a chance to make a profit in the long run. That’s because, during periods of inflation, you’re investing in an asset that’s holding steady or increasing in value. In addition, the average annual price increase has consistently outperformed average inflation in recent years. Home ownership is thus a major barrier to the impact of rising inflation.
What does that mean to you? Today, experts predict that house prices will only rise if supply and demand remain unbalanced. Once you buy a house, any increase in the house price will increase your equity and net worth. You can be sure that the investment to buy a home during this time will pay off. If you are ready and able, buy today before the price rises.
If you’re considering buying a home this year, you need to act quickly, even if inflation picks up. That way you can stabilize your monthly housing costs and invest in a home with upside potential. So if you’re ready to get started, sign up here and contact us at (+84) 948 230 033 or email: customer@gethomebase.com. The Homebase team will contact you as soon as possible and provide more details.
