Real Estate as a Hedge against Inflation

We haven't heard a lot about inflation recently. However, prices have started to creep upward over the last year. As examples, here are a few categories that increased from November 2010 to November 2011:

Food at home – up 6.2%Housing fuels and utilities – up 3.5%Transportation – up 9.2%

Today, we want to address the issue of inflation and the advantages of owning real estate. The National Association of Realtors (NAR) took an historic look at the impact of inflation. Here are some inflation numbers over the past 30 years:
 

We can see that real estate has fared very well. The most important number is the $0 increase in mortgage amount. The study assumed that the homeowner took a 30 year fixed rate mortgage thereby locking in the housing expense for the thirty years.

NAR then looked at inflation moving forward over the next thirty years. Obviously, if it remained the same as the last thirty years the percentage increase would be the same. They looked at a low inflation scenario and a high inflation scenario. The graph below shows the findings:

Bottom Line

We can lock in the housing costs of our primary residences and vacation homes at all time lows if we purchase today. Either would be a great hedge against future inflation.

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18% Homes under contract fail to close

4827 North Fairfield 1 Lincoln Square Condo

Large sunny light-filled 2bedroom 2bath Lincoln Square located at 4827 North Fairfield Avenue Unit 1, Chicago IL. This home features a large corner condo with jumbo living room & open kitchen. Large bedrooms with spacious master suite with organized closets. Oak floors. Newer windows. Central heat/air. In-unit laundry. Extra storage. Few blocks to Rockwell Brown Line. Next to Gross park and near Ronan river walk. Rear deck off kitchen. Ample street parking. Solid association.

A real gem worth seeing.

www.4827NFairfield1.info for more information. 

Contact us for your appointment today. Gramata Realty Group Chicago, Illinois

Modern Bucktown Living 2321 W McLean Ave Chicago, IL ModernBucktownLiving.com

Welcome home to this renovated luxury single-family residence just off of the Armitage Avenue in Chicago’s Bucktown neighborhood.

www.ModernBucktownLiving.com for more info.

This home is ready for the most discerning buyers who appreciate contemporary design with quality, value and location. Single-family masonry residence in the Bucktown community which features a modern multi-level home with a central open riser steel staircase and a three story tall atrium space with roof skylights allowing light to pour into the homes central core. Brazilian cherry hardwood floors on three levels. Large Great Room level includes custom cherry cabinets, granite tops and a back wall of windows letting the southern light pour into this primary living space. Full side by side laundry on this level too. Walk out french doors leads to one of the three outdoor deck spaces and landscaped yard including an outdoor pond with fountain and fenced yard with 2 car detached garage. Three bedrooms upstairs with two bedrooms and second bath on second level and large master suite steps above second level with a walk through organized closet system, large master sleeping area enough for an office or seating area and with walkout deck overlooking rear landscaped yard. Master bathroom includes a large twin whirlpool tub and walk-in shower with multi-head shower features. Dual vessel sinks with Philipe Starck fixtures.

Lots of privacy and separation yet everything is close and well laid out and proportioned. Another original superior quality design from the Gramata Development Corporation.

Great location near shopping, theater (3 blocks) the Metra (5 blocks) the Blue line El (one block) to downtown and airport, I-90 expressway (5 blocks) and public transportation (one block). Three blocks to Holstein Park with outdoor pool, courts, swing sets, activities for everyone. Walkscore.com has rated this home a 95/100 “Walkers’ Paradise” because of its close proximity to restaurants, schools, parks, grocery stores and there are nine transportation options nearby including two train options making this home a commuters dream whether by car, bus or train.

Gramata Realty Group

LuxuryLakeviewLiving.com at 3531 N Bosworth Avenue, Chicago, Illinois

Welcome home to this renovated luxury single-family residence on the highly desirable Bosworth Avenue just off of the Southport Corridor in Chicago’s Lakeview neighborhood.

This home is ready for the most discerning buyers who appreciate quality and value and of course location on this most desirable of Lakeview streets. Located on a 37 1/2 foot extra wide lot (and building), this jumbo solid masonry home is not your cookie cutter home. Oversized rooms flow together nicely and all fill with natural light. Quality finishes and updated systems awaits the buyer of this home. Formal living room and dining room with a fully renovated kitchen with huge adjoining great room and sunroom are great for the day to day living as well as when entertaining. Much of the original woodwork remains in this home however most of the major systems including the roof and mechanical systems have been improved in recent years making this home move-in ready.

The upper level includes a central sitting room with three bedrooms including the huge front room with side sitting room and closet. The master bedroom suite will not disappoint. Large room sizes and a completely renovated bathroom completed in 2010 again make this move-in ready to enjoy today! The lower level can remain a separate residence with its two additional bedrooms, full kitchen and large recreation room or an easy ‘no work’ conversion to a single-family residence. Could also be an in-law or au paur option too.

Walkscore.com has rated this home a 95/100 “Walkers’ Paradise” because of its close proximity to restaurants, schools, parks, grocery stores and there are thirteen transportation options nearby including three train options making this home a commuters dream whether by car, bus or train.