Inflation - Does It Really Help REI?

[Bryan Hancock]

I am reading a book on hyperinflation and depression right now. This seems to be a popular target with all of the mess going on so I figured I would try to educate myself some more. The author is a renowned REI author. He claims that inflation will not benefit real estate investors using the reasoning that fixed-rate debt's real cost will be offset by increased expectations for inflation that drive up interest rates. Higher interest rates mean lower capital values and thus lower prices for real estate.

This seems logical to me, although I don't know if they will offset each other perfectly. I guess I don't care too much if I don't plan to sell the projects while said inflation is high, but this has caused me to think a lot about how sound it is to hedge inflation with leveraged real estate. I guess it would depend on your goals.

Thoughts?