How to Protect Your Portfolio Against Inflation

How to Proect Your Portfolio Against Inflation

How to Protect Your Portfolio Against Inflation

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How Real Estate Protects a Portfolio Against Inflation

As the year continues, inflation has been the topic of conversation on many investors’ minds. So far, we’ve seen inflation steadily rise over the past year, and according to Statista, it hit an all-time high of 8.5% in March 2022. These rising inflation numbers can be startling to see as products and services will now be offered at much higher rates, resulting in the average person’s purchasing power being reduced, especially when it comes to retirement savings.

The good news is that there is a solution to help protect your portfolio against inflation: real estate. By passively investing in real estate through a privately held boutique real estate investment company like MRA Capital Partners, you’ll be able to make inflation work for you and increase your income.

So, how does real estate work as a hedge against inflation? Keep reading to find out.

Allows You to Raise Rental Prices

Investing in a multifamily property is a great way to make extra income, especially in today’s rising market. According to Forbes, renters are now increasing their prices by at least 30% in desirable cities. This can help protect your portfolio against inflation because your initial fixed mortgage rate does not change.

Use Tax Benefits to Offset the Effects of Inflation

Real estate provides tax benefits that can help offset the effects of inflation. For example, in the United States, real estate investors can deduct depreciation expenses from their taxable income. This deduction helps to reduce the amount of taxes owed and ultimately results in more money being available to reinvest in real estate investments.

Sell Properties for Higher Prices

As prices increase with inflation, the value of real estate typically goes up, which means that if you were to sell your property, you would be able to get a return on your investment that is higher than the rate of inflation.

Finding Opportunity. Delivering Results.

MRA Capital Partners offers real estate investment strategies focused on maximizing the internal rate of return through favorable deal structures and the pursuit of non-correlated investment returns. Learn more about our investment strategies by visiting us online. Also, sign up to join MRA Capital Partners’ preferred investor network to learn more about our upcoming unique investment opportunities.