Real Estate: A Shining Star in Turbulent Economic Times
Real estate investments have emerged as a reliable hedge against inflation, with housing prices appreciating by 13% CAGR over the last two years.
Real EstateInflationHedgeInvestmentAnarockReal EstateJun 13, 2024
Inflation, which gradually increases the general prices of goods and services, erodes the purchasing power of money. However, real estate investments offer a tangible asset with intrinsic value, generating rental income and adding value through capital appreciation. As Anarock emphasized, inflationary pressures can actually increase the value of real estate investments, making them an attractive hedge against inflation.
Consistent urbanization, combined with steady population growth, has spurred housing demand, leading to a rise in residential prices. Real estate investments generate rental income, which potentially grows over time in response to inflation. Landlords typically adjust rental rates as the cost of living rises, ensuring that investors can keep pace with inflation.
Moreover, real estate assets can also be leveraged to borrow funds for more acquisitions, providing investors with a valuable source of financing. According to Shobhit Agarwal, Managing Director and CEO of Anarock Capital,
Frequently Asked Questions
Why is real estate considered a hedge against inflation?
Real estate investments generate rental income and add value through capital appreciation, which can keep pace with inflation, thereby protecting investors' wealth from erosion.
How has urbanization affected the real estate market?
Consistent urbanization has spurred housing demand, leading to a rise in residential prices and rents.
Can real estate assets be used to borrow funds for more acquisitions?
Yes, real estate assets can be leveraged to borrow funds for more acquisitions, providing investors with a valuable source of financing.
How has real estate performed compared to inflation in recent years?
According to Anarock, housing prices have appreciated by 13% CAGR over the last two years, outperforming CPI inflation, which has moderated to 5.4% at the end of FY24.
What is Anarock Capital, and what services does it offer?
Anarock Capital is the investment arm of Anarock, offering a range of services, including investment advisory, asset management, and capital markets.
Related News Articles
Godrej Properties Expands Footprint with £717 Crore Land Acquisition in Navi Mumbai
Godrej Properties Limited (GPL) has made a significant move in the real estate sector by acquiring three contiguous plots of land totaling 6.54 acres in Navi Mumbai. This strategic acquisition is valued at Rs.717 crores, further cementing the company’s po
Macrotech Developers Reports 88% Profit Surge to ₹944 Crore in Q3
Macrotech Developers, a leading real estate developer, has reported a significant 88% surge in profit to ₹944 crore in the third quarter, driven by higher income and robust project deliveries.
DLF Aims for Rs 26,000 Crore from Mega Luxury Project in Gurugram
DLF, one of India's leading real estate firms, is all set to launch a super luxury project in Gurugram, with an ambitious target of generating Rs 26,000 crore. The project is expected to redefine the luxury real estate market in the National Capital Regio
Family Feud Erupts in Deolali: Tanuja Gholap Files Nomination Against Brother Yogesh
Tanuja Gholap, daughter of former minister Babanrao Gholap, has sparked a family row by filing her nomination as an independent candidate from Deolali, where her brother Yogesh Gholap is contesting for the Shiv Sena (UBT). The family tensions are further
Revamping Slums: PMC's Ambitious Rehabilitation Scheme to Transform 22 Pockets in Pune
Pune Municipal Corporation to launch slum rehabilitation scheme under Pradhan Mantri Awas Yojana, transforming 22 pockets in the city.
Shradha Infraprojects Reaches New Stock Price Milestone at Rs. 103.21
Shradha Infraprojects, a prominent microcap construction and real estate company, hit an all-time high stock price of Rs. 103.21 on December 30, 2024. This remarkable achievement showcases the company's robust growth and strong performance in the market.