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18 Jan 2016
Gold v Real Estate is not really much of a competition since late in 2011. In 2011 Gold was up to $1,889 an ounce, and today gold is $1,089 an ounce. This chart shows that gold has dropped $800 per ounce. Ouch! That’s a 42% loss. And this has all happened in a time when the economy has been slowly recovering. Real estate prices have risen over this same period by 20% to 50%, depending on where you are in the U.S.
In December of 2011 I predicted the collapse of gold in an article called Gold or Real Estate? In one of my earlier articles, I suggested that transferring from gold to real estate (a retirement home) could end up paying for your retirement home. I was right. If you had $1 million in gold and sold it then, and purchased a home for $420,000 today, your home would have been paid for by the loss otherwise sustained by holding onto gold. I’m not a seer, and I’m not the seventh son of a seventh son, but fundamental technical chart reading of the gold chart in that 2011 article revealed a huge red flag in gold prices. Gold peddlers are still trying to sell you gold, and they have been watching the decline this entire time. They make their fees on commissions, and they are not concerned about whether you make money or lose it. By the way, don’t pay attention to their slick pitch that “gold is a hedge,” and beware of anyone who says “gold is not an investment.” That’s how they talk when they anticipate you will lose a lot of money.
Real estate has never been a perfect investment either. There is no such thing as a perfect investment. There are only levels of risk and levels of security. My argument isn’t that you couldn’t lose money by investing in real estate. Instead, my argument is that real estate is far safer than gold or the stock market in these current markets. Far safer, especially in such uncertain economic times, especially on the International level. I think it is thinking hard about gold v real estate.
Appreciation in real estate will not be explosive over the next few years, but homes in the Sequim area will appreciate, and with far less risk than gold or the stock market. And when it comes to gold v real estate, I don’t think it’s much of a competition.
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Having a difficult time finding the right agent? Simplify your life! Choose Chuck Marunde. I did. [Name withheld by request]
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