Inflation has been the biggest killer of wealth in Nigeria. The cost of our daily needs appears to be soaring thanks to inflation. Inflation is determined by a set of economic indicators described by the Consumer Price Index (CPI), and it appears that this will continue to be the case for the time being.
Inflation is the gradual loss of a currency’s buying power over time. The increase in the average price level of a basket of selected goods and services in an economy over time can be used to calculate a quantitative estimate of the rate at which buying power declines. A rise in the general level of prices, which is frequently stated as a percentage, signifies that a unit of currency now buys less than it did previously. Investopedia
In this article, we will be talking about real estate investment and how it helps you battle the current inflation in Nigeria.
Real Estate Investments
The average individual should consider investing in or owning a real estate asset. Real estate investment means the purchase of property as an investment to generate income rather than using it as a primary residence.
Real estate investment types include residential real estate, commercial real estate, and industrial real estate. You can read more about Real estate Investments.
Real estate investing can be capital-intensive, but the returns are often consistent. While making real estate investments may be out of reach for the average investor, there are other ways to participate in the real estate market. One of them is a mutual investment plan.
Real Estate Investment Trusts (REITs) are another option for investing in real estate (REITs). A real estate investment trust (REIT) is a company that owns income-generating real estate such as healthcare facilities, offices, shopping malls, and office spaces.
These trusts are typically traded on the stock exchange. REITs are less risky than stock exchange investments and frequently pay higher-than-average dividends.
Real Estate Income
One of the best ways to protect your investment portfolio against inflation is to generate income from real estate. The amount a landlord can charge for rent rises in tandem with the value of the property.
As a result, they will be able to earn a higher rent income over time, which will keep up with inflation. The revenue earned through renting out a property is referred to as “real estate income.”
Despite the economic downfall in Nigeria, real estate investment is the only investment that is not affected. You don’t need to have millions of naira before you can invest in real estate in Nigeria. This is because there are developing places that have huge investment prospects. The benefits of investing in real estate cannot be overlooked.
Real estate is like the gift that keeps giving, becoming the gains of that one-time investment that can transcend a lifetime, continue here to read on the Benefits of real estate investments.
There are pros and cons to investing in real estate. Real estate investments are illiquid, meaning they can’t be quickly and easily sold. If you are purchasing a property, it will require management and maintenance, and these costs can add up quickly.
Investing in real estate guards you against inflation in Nigeria by ensuring that money invested in getting a building rises regardless of the economy. Either the economy rises or falls, people will still be in need of a good house to call home. This keeps you in a win-win position.