A Portfolio of Commodities

Have you ever thought of a home as a commodity? A commodity can be defined as a raw material or product that can be bought and sold. A home is not a raw material, but it is certainly built out of many, like a box full of wood, steel, cement, glass and copper.

Over the long term, home prices usually rise along with the cost of the commodities it takes for construction. While high inventories of housing may be keeping prices lower right now, the cost of the raw materials that are intrinsically tied to a home's value are rising, and rapidly.

With increasingly higher construction costs on the horizon, buying now is an ideal investment, and a hedge against the rising cost of commodities. Every home is a store of value for all the materials, the land and the labor involved in its construction. So the long-term value of a home is tightly connected to the cost of its production, making it a very different type of investment from stocks or bonds.

Investing in commodities has always been a great way to make lemonade from the economy's lemons. And what better way to buy into the commodities market than by purchasing a home? Sooner or later, home prices will be pushed higher by the rising cost of raw materials, so make your move now!