Inflation has been making headlines for the past couple of years, and if you're a real estate investor (or thinking about becoming one), you’re probably wondering—how does this impact me and my investments?
Is it good? Is it bad? And most importantly, what should I be doing right now to make the most of it?
The truth is, inflation isn’t all bad. In fact, if you know how to use it to your advantage, inflation in real estate can let you keep more of your money and grow your wealth while the dollar loses value. But there’s a right way and a wrong way to go about it.
Today, I want to show you why real estate values rise with inflation and how to structure deals to maximize cash flow.
Let’s do this.
Inflation Drives Up Property Values and Rents
Inflation has been running hot for over two years now, and we’ve all felt the impact—higher prices on gas, groceries, and just about everything else. For real estate investors, inflation affects both the cost of doing business and the value of the assets we own.
Here are 2 things you need to know about the relationship between real estate and inflation before we move on:
- Inflation can drive up property values and rents, which is great for owners.
- But it also increases expenses—insurance, labor, maintenance, and property taxes.
So, is inflation good or bad for real estate? Well, it depends on how you approach it. If you’re in the right kind of real estate—multifamily, for example—it can actually work in your favor. But if you’re relying on strategies like flipping houses or single-family rentals, you might run into problems.
Why? Because single-family real estate is more tied to market fluctuations. If inflation pushes interest rates up (like it has in the past two years), home prices can drop, making flips riskier and less profitable.
So what’s my solution for this? How do I leverage inflation?
2 Reasons That Multifamily Real Estate Wins in an Inflationary Market
1. Multifamily Real Estate Is Naturally Hedged Against Inflation
One of the biggest reasons I love multifamily real estate is that it actually benefits from inflation over time.
When inflation goes up, so do rents. And since rental income is the biggest factor in a property's value, higher rents lead to higher property values. That means if you own a multifamily property, you’re positioned to ride the inflation wave instead of getting crushed by it.
Additionally, expenses in multifamily don’t rise as fast as rental income does. Sure, costs go up, but as long as rents outpace those expenses, your net operating income (NOI) increases—driving up the value of your asset.
2. Interest Rates and Inflation Are Creating Buying Opportunities
From 2020 to 2022, investors were overleveraging—taking on too much debt and paying too much for properties. Now, many of those deals are struggling because their financing costs have skyrocketed.
That means opportunities are opening up for smart investors who understand the market. Right now, we’re seeing:
- Lower leverage deals (65-75% loan-to-value), which means less risk.
- Fixed-rate financing, so you’re protected from future interest rate hikes.
- Higher cap rates, meaning you can buy properties at a discount compared to two years ago.
This is why I believe 2025 is a prime time to get into multifamily investing. We’re seeing deals at 30% discounts compared to what they were just a couple of years ago.
How to Take Advantage of This Opportunity
If you’re serious about investing in real estate but haven’t made the jump yet, here’s what you should do next:
1️⃣ Start Learning the Fundamentals – The best way to get started is to educate yourself. That’s why I created the Apartments 101 Masterclass, which walks you through everything step by step.
2️⃣ Build Your Team – You don’t have to do this alone. Multifamily is a team sport, and when you have the right people on your side—brokers, property managers, lenders, and investors—you can scale much faster.
3️⃣ Look at Deals Now – The best way to learn is by taking action. Even if you’re not ready to pull the trigger today, start analyzing deals and talking to brokers so you’re prepared when the right opportunity comes along.
4️⃣ Leverage the Right Financing – In today’s market, fixed-rate loans and conservative leverage are key to reducing risk and ensuring long-term success.
Inflation isn’t going away, and if you’re sitting on the sidelines, you’re missing out on one of the best wealth-building opportunities in real estate. Multifamily investing is scalable, stable, and a proven hedge against inflation—but you have to take action.
If you’re ready to learn how to pivot from single-family investing (or just get started from scratch), check out my Apartments 101 Masterclass.
Click here to watch the full training now.
To your success,
Michael Blank