Quote:
Originally Posted by Porsche-O-Phile
Are you saying real estate will out perform inflation NOW?
You're kidding, right?
Historically real estate approximates inflation so effectively it's just a savings account that keeps your money socked away at current value. Today, it's a guaranteed loss. Five years ago it was a good bet.
It will take a long time for real estate to be a good inflationary hedge again, unless we get runaway/hyper inflation - which is a possibility I guess...
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Only if you pay cash for the property. You neglect to consider leverage and tax advantage.
To make it simple for you...I can buy a home for $100k today with anything from 0 to a max of $20K down. I can rent it out to cover the payments and probably write off about $4-$5K per year of my regular income from my taxes. In 15 years...it is paid off and I have at least $100K (inllation protected) if it has kept up with inflation as you suggest (although I suspect more). I can't think of a better investment
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Last edited by fintstone; 09-20-2008 at 01:22 PM..
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