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Duke Warner Realty

Why It is Better to Invest in Real Estate Than Gold

The facts don’t lie. Most Americans believe that real estate is a better long-term investment than gold.
This may come as a shock to some people who have placed their money into gold investments. Since buying gold is a money investment, people invest in it when hedging their portfolios whenever they expect the devaluation of the dollar based on negative economic impacts. Yet a recent Gallup Poll has shown that 35% of Americans believe real estate is the better investment to gold, as only 17% of people believe gold is the top investment to make in 2016.

Why Real Estate is Hot Right Now

Since the time of the housing market collapse in 2007 to 2009, home prices have rebounded significantly. From 2011 to 2016, the home sales have raised about $100,000, as people are rushing to get into this long-term investment. During the same time period, gold investments have significantly plummeted per ounce, causing people to abandon this investment avenue and look for other better opportunities. People are regaining their faith in real estate as the stock market’s volatility is forcing investors to be concerned.

Why Investing in Real Estate is the Better Move

There are also other immediate reasons on why investing in real estate is more appealing than gold when it comes to investment opportunities. When you purchase gold, there isn’t a discount as you pay the current price for it. On the flip side, a person only needs a small percentage, such as 10%, as a deposit for real estate property as you can skip the down payment for a single-family home purchase.

Many people also by real estate as an income property when renting. The potential cash flow can pay off the mortgage and allow a person to bring in significant earnings over a period a time. Then, in time, a person can sell the property or use the rental income to make additional real estate purchases.

Another aspect to consider is inflation when it comes to real estate versus gold investments. Gold values go up when paper money values decline, as the gain seen is usually nominal. When real estate values rise, it can be a significant gain as investors can reap in the earnings.

Invest Where it Makes Sense

As an investor, you have to understand your own portfolio, your income, and how you want to diversify to make the right choice for your investments. There are many reasons to consider real estate as the ideal area of where to place your money instead of buying into gold. One of the best things you can do if you are a first-time investor is to consider all the aspects of your financial situation and research the market as well as past trends. You may find that real estate investments have done well in the past. Back in 2002, 50% of people named real estate as a top investment. That figure is something to think about when it comes to making your money grow to your advantage.