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Thread: Gold is Better than owning Real Estate

  1. #1

    Default Gold is Better than owning Real Estate

    Gold is portable and can be traded for currency in any country. If I had 300k today and bought gold and dug a hole in the ground and buried it, it would be better than owning my home free & clear. IMO gold has outperformed the market even at its devalued price. In 2002
    the price of gold was just under $310 & the lowest point of the dow was 7286. Today gold is at $1260 and the dow is at 17k. Gold has outperformed the DOW since 2002. If a collapse occurs the value of real estate will drop and very nice homes will be on the market at extremely low prices. The price of gold will soar. Bury the gold, dump the house, buy a nicer house for cheap after the collapse. If no collapse gold will still outperform the market.
    Last edited by Schifference; 06-10-2014 at 02:46 PM.



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  3. #2

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    Your statement is too broad and not accurate in a broad sense.

    It depends entirely on the utility and productive capacity of the Real Estate (and if it's in the right hands to make it so).

    Gold is certainly more "fool proof".
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  4. #3

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    It would depend on how you calculate "better". And how you consider it as an "alternative" to buying a home in the first place. It is a false choice unless the house is to be rented out to somebody else.

    In housing, you have two choices- rent or buy. If you are renting, you are often spending about the same money as you can find a place to buy for so buying a home really doesn't take away from money you have available to do something else with. Buying replaces money doing nothing but paying rent and uses it to buy an asset- a home. If you are buying gold, that must come from not buying something else. If I spent $100,000 on a home, that is using money which would have been getting me nothing and getting something of value with the same money- money which was generating nothing for me. If I spend $100,000 on gold, that $100,000 is not instead of but IN ADDITION to the money I was paying for rent. If my mortgage is instead of paying rent, I can get the benefits of BOTH for the same amount of out of pocket costs so it is really not a question of either or.

    Another issue is how long will you own the house for. If you keep it long enough for it to pay off, you now have increased your disposable income by the amount of your mortgage- say $500 a month on a $100k mortgage. Gold cannot do that unless you sell it off. With the house, your cash flow has increased and you get to keep the asset.

    In 2010 the price of gold was just under $310 & the lowest point of the dow was 7286. Today gold is at $1260 and the dow is at 17k.
    Citing a bubble in the price of gold is not evidence that it is always a good investment. But if you do want to get selective with numbers, gold is down 35% from its high and the current trend is for it to go lower. Housing has had its own bubbles too.

    My own home (each case will be different) is paid for and my disposable income rose by 25%. Every month from now on. For the same amount of money, gold would not do that for me. And again, the money for my mortgage came out of money which was going to rent-money I was giving away getting nothing for but a temporary roof over my head- not my extra disposable income. And compared to the purchase price, it is now worth 2.5 times what I paid for it (but that is only money which can be realized by selling the home).
    Last edited by Zippyjuan; 06-10-2014 at 01:53 PM.
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  5. #4

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    2010 was a mistake meant to say gold was $310 in 2002.
    If you were purchasing a house and had very little equity in the home you could walk away from it, dig up your gold and go buy a better home for less money.

  6. #5

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    if i had a million dollars to spend , i would buy a farm in illinois or iowa .

    the goverment can't take my farm , they have already shown they can take your gold , or they could start selling their stock pile ( if they have it ) of gold and drive the price to $200/oz .

  7. #6

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    Quote Originally Posted by ILUVRP View Post
    if i had a million dollars to spend , i would buy a farm in illinois or iowa .

    the goverment can't take my farm , they have already shown they can take your gold , or they could start selling their stock pile ( if they have it ) of gold and drive the price to $200/oz .
    I would never buy in Illinois .

  8. #7

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    Quote Originally Posted by ILUVRP View Post
    if i had a million dollars to spend , i would buy a farm in illinois or iowa .

    the goverment can't take my farm , they have already shown they can take your gold , or they could start selling their stock pile ( if they have it ) of gold and drive the price to $200/oz .
    They have a proven track record of taking peoples lands as well. You are not safe from government oppression.

    Now as far as gold vs a home. Personally, I see the value of a home being infinitely superior to a hunk of shiny rocks. If I owned my own home (I just want a modest small 2 bedroom home) and had it paid off, sure gold would be great to have, but as with anything a good is only worth as much as it's perceived value to the individual consumer. Right now, gold is worthless to me because it can't help me in any way for my economic disposition.

    BTW, I am pro precious metals.
    "I know the urge to arm yourself, because thatís what I did. I was trained in firearms. When I walked to the hospital when my husband was sick, I carried a concealed weapon. I made the determination that if somebody was going to try to take me out I was going to take them with me."

    Diane Feinstein, 1995

  9. #8

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    Quote Originally Posted by Schifference View Post
    If I had 300k today and bought gold and dug a hole in the ground and buried it...
    ...whose yard would you bury it in if you had no real estate of your own?
    'It ain't what we don't know that hurts us, it's what we "know" that ain't so.'--Will Rogers

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  10. #9

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    Quote Originally Posted by oyarde View Post
    I would never buy in Illinois .
    i had 200a about 60 miles north of st louis , anything north of springfield i would not have .

  11. #10

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    Yes, gold is better than real estate, and bitcoin is better than gold
    Tax is theft. War is murder. Conscription is slavery. Government is organized crime.

  12. #11

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    Probably right Schiff, but I can't live in a bucket of gold, cook food on it, bathe in it, heat or cool it for the benefit of my family.

  13. #12

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    Quote Originally Posted by Schifference View Post
    Gold is portable and can be traded for currency in any country. If I had 300k today and bought gold and dug a hole in the ground and buried it, it would be better than owning my home free & clear. IMO gold has outperformed the market even at its devalued price. In 2002
    the price of gold was just under $310 & the lowest point of the dow was 7286. Today gold is at $1260 and the dow is at 17k. Gold has outperformed the DOW since 2002. If a collapse occurs the value of real estate will drop and very nice homes will be on the market at extremely low prices. The price of gold will soar. Bury the gold, dump the house, buy a nicer house for cheap after the collapse. If no collapse gold will still outperform the market.
    So you're telling me gold is better IF:

    1) You bought that gold over a decade ago.
    2) You successfully speculate in the real estate market
    3) You successfully speculate in the gold market

    Do you know how difficult those things are to actually accomplish? It's not as simple as, "Hey, let's all wait for a crash!" What happens in the years intermittent while you're homeless? Do you waste your money on rent? Just wait it out in a smelly, cold, bug-infested tent or trailer with your gold stash buried beneath?

    I think real estate is more valuable because it has infinitely more practical uses. There are a lot of things you can do with real estate that are impossible to do with gold. Not only does real estate provide you with comfort, shelter and a place to do all of your daily life-sustaining functions, but it can also generate income, which you can then convert to gold if you so desire.
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  14. #13

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    Quote Originally Posted by Schifference View Post
    2010 was a mistake meant to say gold was $310 in 2002.
    If you were purchasing a house and had very little equity in the home you could walk away from it, dig up your gold and go buy a better home for less money.
    In the same sense, I could say just about any stock, asset, commodity or investment is more valuable than real estate (why buy a home when you can buy TWO?) if you get involved at the right time... but that's the whole problem, isn't it?
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  15. #14

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    Faith in the risen Christ is worth more then all the precious metals and luxurious estates in the world, both in this life and the next.
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    'These things I command you, that you love one another.' - Jesus Christ

  16. #15

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    Quote Originally Posted by ILUVRP View Post
    if i had a million dollars to spend , i would buy a farm in illinois or iowa .

    the goverment can't take my farm , they have already shown they can take your gold , or they could start selling their stock pile ( if they have it ) of gold and drive the price to $200/oz .
    Just the opposite, they have taken many farms. Gold confiscation did not apply to most people.

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  17. #16

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    Yikes... I love PMs but if you really believed that then Silver would be better than Gold...
    It's just an opinion... man...

  18. #17

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    Quote Originally Posted by Danke View Post
    Just the opposite, they have taken many farms. Gold confiscation did not apply to most people.
    It's also a lot easier to hide the PMs lol...
    It's just an opinion... man...

  19. #18

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    My point is you would be better to own physical gold and a home via a large mortgage. You have a place to hang your hat, kick back & relax and cook your dinner but if times go bad, let the bank take it back and buy a it back or a better place for a fraction of what you owed. If the collapse never happens you have your job to make mortgage payments. If $#@! hits the fan, let them take it back. Instead of having 400k into a piece of real estate that is then valued at 120k you have gold worth millions.

  20. #19

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    i will say ,one thing about owning a farm , its like having your own country , you feel very free , if you want to - build - burn -tear down - change anything you can , no permits needed for anything .

    the only bad thing they are taxing the hell out of farms as you can't pick them up and leave .

  21. #20

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    Quote Originally Posted by Schifference View Post
    My point is you would be better to own physical gold and a home via a large mortgage. You have a place to hang your hat, kick back & relax and cook your dinner but if times go bad, let the bank take it back and buy a it back or a better place for a fraction of what you owed. If the collapse never happens you have your job to make mortgage payments. If $#@! hits the fan, let them take it back. Instead of having 400k into a piece of real estate that is then valued at 120k you have gold worth millions.
    That's all dependent on speculation in the markets, something for which there is absolutely NO guarantee.
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  22. #21

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    Quote Originally Posted by PaulConventionWV View Post
    That's all dependent on speculation in the markets, something for which there is absolutely NO guarantee.
    Does purchasing a home require speculation? It seems that pretty much any investment is speculative. Even good fundamentally sound companies can lose money or go belly up.

  23. #22

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    It does not REQUIRE speculation.

    If you buy the place and falsely evaluate risk by thinking that prices only go up, or they can't drop by X amount - then you are a speculator.

    IF you buy what you can afford to service over the long term and you have no concern for resale price because it's your primary residency...there is no speculation involved. THAT is what the US housing market used to be like.

    Quote Originally Posted by Schifference View Post
    Does purchasing a home require speculation? It seems that pretty much any investment is speculative. Even good fundamentally sound companies can lose money or go belly up.
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