Around 30 years ago, in 1991, one dollar was worth more than twice today’s dollar. Play around with the BLS inflation calculator to get a sense of the power of inflation for yourself.
When people are willing to pay more money for goods and services, their cost increases, the more money is available in the economy, the more people are willing to spend, driving up costs and reducing the value of a single dollar.
Real estate values and rents not only tend to keep pace with inflation but drive inflation itself. As a result, they often rise faster than the official CPI inflation index.
As with rental properties, land has intrinsic value. We need it for farming, building homes on, building commercial properties on, or simply for recreation such as fishing and hiking.
Private REITs, a form of real estate crowdfunding investment, are far less regulated, making them more flexible. Some pay high dividends; others reinvest much of their revenue into new properties.
Interest rates are meager in the wake of the coronavirus pandemic, with the Fed funds rate still near 0%. If you have an ARM or adjustable rental property loan, consider refinancing it to fixed interest.