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I’m suggesting buying a home at a record low interest rate is a good decision if you can afford it, especially with inflation on the horizon. If you plan on st
by almost_usual 5y ago
I’m suggesting buying a home at a record low interest rate is a good decision if you can afford it, especially with inflation on the horizon.
If you plan on staying there 10-15+ years and aren’t stretching financially I would buy.
- lottin 5y agoInflation doesn't make one investment opportunity more attractive than another.
- wulfricin 5y agoinflation makes buying stuff on credit more attractive, especially when you can get it with really low interest rates which everyone expect to rise sooner than later
- lottin 5y agoNot really... if everyone expects inflation to rise, it will already be priced in.
- unstatusthequo 5y agoNot everybody is clued in. Average random person on the street can’t even answer the question of how does money supply and inflation interact?
- gassius 5y agoPriced in, in what? Assets prices? That would make for, inst-ainflation, I guess... In any case, the thing is that cannot be priced into the rates of loans, because the same factor that will contribute to a rising inflation (increasing the monetary mass faster than real economic productivity) makes the loans very cheap by definition. I for sure would get into all the long term fixed low rate debt I can handle to acquire assets that I think will not depreciate as fast
- gassius 5y agoInflation does make long term debt with low, fixed interest rate very attractive
- lottin 5y agoOnly in retrospect, if inflation was unexpected. But if it was unexpected you couldn't have taken advantage of it, because, by definition, you weren't expecting it.
- gassius 5y agoI don't see how the expectation change anything. Either inflation dilute the monetary value of your debt quicker than your asset depreciation or it doesn't. So, any scenario were you bet (correctly) that inflation will rise at a higher rate than a fixed interest rate is very attractive