Realty Sector and Inflation

The cover story published in the previous issue regarding interest rate hikes and rising inflation levels was highly informative. Is it advisable to invest in realty sector during periods of high inflation?
- Jayant Kamble 

Editor Responds: Thank you for your appreciative words. Real estate is considered one approach to hedge against inflation given the fact that this asset class usually has little correlation with stocks and bonds. In the long term, inflation and housing usually move in the same direction due to wages and interest rates. Investors can invest in REITs (Real Estate Investment Trusts) as a hedge against inflation. The price rise is transferred to the customers via the passthrough of price increases in rental contracts and property prices. Currently, organised real estate players are gaining market share which is making it a bit lucrative for the investors to get exposure to this sector. We hope we are able to answer your query. Keep writing to us.