Investment in Gold Versus Investment in Real Estate

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The popular advice from renowned finance experts is to always have a diverse portfolio so that the risk is spread out evenly. When you have a basket that is filled with investments in all segments, there is hardly any chance for you to lose; what’s more, there are better chances for you to gain profit. Though the preferred areas are as diverse as gold, oil, minerals, land, stocks and share etc, most people prefer to either invest in solid gold or the dependable and tangible asset that land is.

Generally gold is considered as money that has great liquidity. A commodity that denotes wealth and is often a possession that is sought after, not just for the intrinsic value but also to the charm it has. When you compare gold with hard currency like the U.S. Dollar or the GB Pound, gold is obviously the better choice as it is firm and dependable. While South Africa is still one of the greatest sources of gold in the past century, China is fast catching up with new deposits being discovered in the Shandog area that accounts for almost 20% of all the gold mined in China. However, these deposits are expected to last no longer than 5 to 6 years. Given this scenario, there will certainly be a perpetual demand for gold which can only drive the prices one way –upwards.

Gold has always been used as a hedge against inflation. What with the government’s fiscal and monetary policies and a perpetually high deficit spending, and the interest rates hovering around zero, the only option seems to be to invest in gold. Apart from the sense of security gold provides, it is reliable.  With most trading activities being carried out online and new ways to invest in gold opening up, there are several options.  You can now invest in gold bars that can be stored in safe custody to be pulled out when the need arises. The other options are to invest in stocks of mining companies that are involved in gold mining and trading.  Of late, the ETFs or gold exchange traded funds seem to be the best option.

When it comes to real estate, there are many factors that influence the prices. There has been a consistent increase in value aggregating to about 25 to 28% in the last 10 years. This is not a bad rate of return considering that you would have been using the property all this time, while the value was appreciating. Here again you could be investing in an apartment building or some commercial property. You may also consider investing in land in a new neighborhood that you expect will appreciate over a period of time. Though the speculation element is there and you would certainly be running a risk, the returns will definitely be proportionately higher.

The things you need to check while investing in real estate are the tax liabilities, the local property taxes you would need to pay etc. More important, you need to get expert legal opinion to ensure that the title is clear of all encumbrances.   While gold has high liquidity, real estate cannot be converted to cash immediately as it involves a lengthy process when you need to dispose a piece of property.

Robin Mckenzie has been writing articles related to Technology News, Gadget Reviews and How To’s. He also does guest posting for bundles.telcoservicesgroup.net, a site that offers great savings and up-to-date information on consumers broadband internet and cable. With service from centurylink, you get top-speed internet, excellent value, and award-winning security.

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Robin Mckenzie likes writing articles related to Technology News, Gadget Reviews and How To's. He also does guest posting for Buycenturylink.com, a site that offers savings and current information on consumers broadband internet and cable.

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