Is gold a better investment asset than real estate?
Find out here.
Advertising Disclosure
- Gold and real estate are deemed as safer investment options than stocks or mutual funds
- Gold's universal demand and limited quantity keeps it ahead of rising inflation
- Gold prices historically surge during recessions
- Buy insured gold manufactured and stored at a government-owned mint completely online
Gold and real estate are two forms of tangible assets that investors look up to for stability and steady wealth creation. Both are known to be safer and less volatile than stocks, mutual funds, and even ETFs. When it comes to comparing real estate and gold, though, the latter might come across as a more stable investment. Here’s why:
In general, real estate is known to appreciate in value over time. It opens up an income stream through monthly rents, and the industry is made up of a multitude of sectors like retail, industrial, housing, medical sciences, and data centers. These sectors are all affected differently, depending on demand and market situations. During the 2008 market crash, for instance, when subprime mortgages were offered to high-risk borrowers on easy terms and without due diligence, a global recession occurred. Despite being considered as stable and resilient, the housing market was hit worse than the stock market.
Fast forward to 2020, the housing sector outperformed (particularly single-family rentals and industrial sectors) other real estate sectors due to record-breaking demand and land value appreciation. At the same time, demand caused data centers, cold storage, and medical sciences to become emerging sectors that are poised for growth in the coming years. On the flip side, social-distancing norms led to global desertion of offices, hotels, and retail stores.
As you can see, although stable, real estate is affected by many different factors. It may still be more stable than stocks and bonds, but it looks to be following a longer market cycle of ups and downs spread over decades.
Gold, on the other hand, is an asset that has surged to record-highs from the 1980’s energy crisis to the 2020 pandemic, even during the 2008 market crash.
Why is Gold Immune to Market Upheavals?
Unlike government-issued fiat currency like Dollar or Euro, the value of gold isn’t prone to market volatility. The limited quantity of gold leads to value appreciation over time and offers a hedge against inflation too.
The high tradability of this time-tested asset also lets you conduct business in a private and trusted manner almost anywhere in the world without the restrictions and failures found in the traditional banking sector. Considering the historical trend of gold prices, the value of gold is only projected to go up with rising demand and diminishing quantity.
Although you might not get monthly income out of it, gold could offset your losses incurred from stocks and mutual funds during recessions. More than a sign of financial wealth, gold has outperformed all other assets over the last century.
How to Buy and Sell Insured Gold Completely Online
Vaulted allows you to directly purchase 99.99 percent pure kilo gold bars manufactured and stored in the Royal Canadian Mint, an ISO 90001:2000 certified refinery owned by the Canadian federal government and audited by the Office of the Auditor General on a quarterly basis.
The app is managed by an experienced team of the McAlvany Financial Group, owner of International Collectors Associates, with experience in dealing with $2.5 billion worth of precious metal transactions.
Transaction fees could go up to 1.8 percent fee based on the wholesale market gold price and a 0.4 percent annual maintenance fee is charged separately for safe storage of your holdings in secure vaults. However, you may also choose to get your gold shipped to your home within a week after placing a request with the Vaulted team. This will forgo the annual maintenance fee.
The Vaulted app facilitates real-time gold transactions with no holdover or waiting periods. Just sign up, link your checking account through their secure platform, and transfer funds from your checking account to your newly created Vaulted account. Once the transfer is successful, you can start buying and selling gold almost instantaneously during market hours.