Although this is a much debated topic already, but still I wish to open a discussion to arrive at a consensus on which is a better instrument for investment both from the perspective of earnings and security.

Gold: Historically, gold has always been a commodity of desire, though people argue that gold doesn't have productive value. It has remained a favorite instrument of exchange from the medieval times of mughals to the current times of Muthoot gold loans :-). It has never seen much of a decline.

Real estate: The value depends on a lot of external factors, infrastructure, stability, surroundings, economic growth etc.

Honourable members are requested to share their esteemed thoughts on which is a better investment instrument among these two and if a portfolio must be maintained, what should be the ratio? i.e. I'm trying to focus on the following categories:

    Physical real estate
    Securities backed by real estate
    Physical gold
    Gold ETFs
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  • Gold is a safer investment in terms of appreciation although the appreciation or returns may be slow. Other advantages you will get buyers easily if you have to sell it. Caution needs to be sure about purity, from theifs.

    Real estate is unpredictable, giving best return for any commodity currently in India but who can predict the big recession like what happened in US, Greece, Dubai, Europe!
  • GOLD is GOLD
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  • Wow... some great data and statistics brought on the table. Thanks everyone.

    Here's my POV on Gold. We all know based on the data shared above that gold has performed consistently across times and history and it being a highly liquid asset can sometimes be termed better than real estate.

    My next logical question comes as to the risk factor involved in holding of physical gold vs paper gold (ETFs). I have come across multiple reports that state that the amount of ETFs currently being floated in the market do not have matching and equivalent quantity of gold physically available.

    One reasonable argument in favour of the above statement is that you can buy any number of ETFs from the market, but there's only X amount of physical gold available actually. This is also evident from the ETF brochures of all the banks and financial companies which state Nova Scotia bank as their custodian, holding physical gold in US or Canada, of the value of ETFs sold.

    Although this does not affect the liquid capability of ETFs, this certainly raises doubts on ETFs as an instrument of trust and dependability Vis-a-vis physical gold. In case of a depression situation, physical gold can save your lives but ETFs wouldn't give you a penny.

    Opinions and thoughts welcome.
  • this is not clear. Can u please share some clear picture
  • Investing in gold more profitable than real estate: Assocham

    Investments in gold have yielded higher returns compared to those in equity and real estate in India during the last three years, according to a study.
    Those who invested in gold between September 2009 and September 2012, have received double the returns when it was their first choice for investment, a study released by industry body Assocham said.

    Presently, price of gold is over Rs 32,000 per 10 grams against around Rs 15,000 per 10 grams about three years ago.

    Hence, giving more than double the returns on investments, it said.
    “Gold has really outdone other asset classes and it is likely to remain an attractive bet as long as uncertainty over the global economy stays” Assocham Secretary General D S Rawat said.

    He added that gold is the safest bet for investments amid uncertainty in other investment avenues.

    The prices of yellow metal saw a huge jump due to high prices of gold across the world and a weakening rupee.

    The study said those who invested in property have also seen good returns. However, these are comparatively lower than returns from gold.

    Investments in real estate have yielded almost double returns in cities such as Delhi, Mumbai, Chennai and Gurgaon in the last three years, it said.

    However, the study said the equity market has been the “worst performer”, with investors witnessing erosion in wealth during the period under review.

    Investing in gold more profitable than real estate: Assocham | Track2Realty || India's real estate e-newspaper
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  • this is wonderful ManojA.. your articles suffices the need of going through news papers.. one stop point for all RE happenings.. keep it up.. and i will look forward for more such wonderful articles..
  • Originally Posted by robert1991
    I guess both have equal priority or value but if you have a property eg flat you can give it on rent and enjoy the cash flow with no tension and when ever you want to sell it you can. you dnt have to take care of flat because theif can only steal gold from you house nt ur entire house on their head n go. so i guess investing in real estate is better!!

    pros n cons r thr in both. in real estate thr r 100's of kinds of frauds too..
    so storage problems for gold = fraud/ farmer probelm, etc for real estate
  • Real estate preferred choice for investments in India: Survey

    NEW DELHI: The preferred asset for Indian investors is real estate sector, followed by gold and silver, a survey today said.

    "The investment pattern in the country suggests that investment flow have been highest in the traditional modes of investments such as in real estate market followed by gold and silver," the survey of PHDCCI said.

    It said that due to the uncertain economic environment and sluggish growth in financial markets, investors are pumping money towards safe and less risky investments as compared with highly volatile investment avenues such as stock market.

    "The extremely high preference real estate can be attributed to the recent sharp rise in rural incomes driven by implementation of several income generating flagship programmes of the government," it said.

    The survey said fixed deposits have also been an important avenue of investments.

    The occupation-wise investment pattern across rural, urban and metropolitan India suggests that the investment preferences are inclined towards safer options like real estate especially among the professionals.

    "...salaried people and the agriculturists have shown very strong preferences towards gold & silver," it added.

    Further, it said that there is need to alter the pattern of investment of the Indian economy.

    "The government needs to promote the financial sector and increasing the size of the financial market is the need of the hour...There is an urgent need to address the problem of lack of investment in financial markets," they survey said.

    Real estate preferred choice for investments in India: Survey - The Economic Times