Why Real Estate Is the Smart Choice During Inflation

Inflation can be a scary word. It means the cost of things we buy every day, like food and gas, goes up. Our money doesn’t go as far as it used to. But here's the good news: Real estate can help protect your money during these tough times.

First, it’s important to understand what a "hedge against inflation" means. Imagine you have money sitting in a bank. When inflation happens, that money loses value. But if you own a house or an apartment building, its value can go up with inflation. This way, your investment keeps its worth or even grows!

When inflation causes prices to rise, rents usually go up too. If you own rental properties, you can charge more. This extra rent helps cover the higher costs of living and keeps your investment profitable. So, not only does the value of your property go up, but the money you make from it does too.

Diego Corzo: A Real-Life Success Story

Let's look at Diego Corzo as a real-life example. Diego came to the United States as an undocumented immigrant and faced a lot of challenges. But he didn't let that stop him. Today, he owns more than 65 properties and has a real estate business worth $20 million! Here’s how Diego did it:

- First Steps: Diego couldn’t work legally when he first arrived. So, he created his own company to pay for college. This shows you don't need a traditional job to start your journey in real estate.

- First Investment: Diego bought his first condo for $20,000 with the help of family and friends. Over time, that condo’s value went up a lot, proving that real estate can grow even when you start small.

- Getting Creative: Banks didn’t recognize Diego’s DACA status (DACA is a permit that helps undocumented immigrants work legally). But Diego didn’t give up. He partnered with his dad to invest in a property in Florida.

- House Hacking: Diego made a smart move by renting out rooms in his home to cover his mortgage. This allowed him to live for free while also earning extra money, which he then reinvested in more properties.

A big part of Diego's success involves working with others. In real estate, this is called "leverage." You can join forces with people who have different strengths and resources. Some might have money to invest but no time, while others may have the time but not the money. By dividing tasks based on what each person is good at, everyone wins.

Even successful people like make mistakes. The key is to learn from them. Diego often invested his own money first to understand what works and what doesn't. This way, he could avoid making the same mistake twice. Learning from your errors is an important part of becoming a better investor.

To scale faster (and with less mistakes), consider joining a mastermind group. These are groups of people who meet regularly to help each other reach their goals. The idea comes from the book "Think and Grow Rich" by Napoleon Hill. When Diego first joined, his net worth was only $25,000, and he was the youngest member. But the advice and support he got from the group helped him grow his real estate business quickly.

REMEMBER: making money isn't everything. It's important to balance your work with your personal life. By investing wisely, you can create financial freedom without sacrificing time with family and friends.

Real estate isn’t just about making money. It’s about building a life where you have financial security and the freedom to do what you love. By investing in real estate, you can protect your money from inflation and even make it grow.

For more info, check out Episode 433 of the Financial Freedom with Real Estate Investing Podcast.

Looking for more? Schedule a 20 minute real estate strategy call with one of our advisors: https://call.themichaelblank.com/clarity/