Yes, Real Estate can be a really flawed inflation hedge, and the relationship between rental yields and interest rates can also deviate sharply from conventional wisdom. Here in Brazil, although inflation is typically in the 4-10% range per year, and although all the rental contracts are tied to inflation indices, you look at homebuilders, REITs, physical real-estate, and nothing has kept up for the last decade. And for as long as I remember, gross rental yields have been lower than the real yields on NTN-Bs - our equivalent of TIPS - which on the face of it doesn't make any sense.