Articles
What is real value?
by Bill Jardine Aug 03, 2007
W ith all of our cocktail talk about real estate values … where are they going and where have they been … we can easily forget what we are really talking about. For example, think about money instead of real estate for a moment …
Let’s say that you decided to sell your family car and hoped to get, say, $10,000 for it. As you put your ads in the paper you will likely be thinking about what you are going to do with the $10,000, right? You may pay off a loan, make a deposit on a new car, or even go on a trip someplace. In any event, your thoughts are about converting that money to something else. You might even buy shares of companies or mutual funds. After all, money is to be used, invested or spent.
Well, let’s say that a nice person agreed to pay you $10,000, but gave you $10,000 worth of gold coins instead a certified check or money order. After all, they are money. Would you refuse to take those gold coins? You would very likely tumble the coins around, make little stacks, bounce them in your hand and finally say “Sure!”
After a certain amount of fiddling around you would find yourself thinking, “This is sure a small pile of coins. Isn’t it amazing to think how valuable these coins really are?” It will seem odd that such a small amount of gold is equal to a whole car or a stack of $100-dollar bills. Yet it surely is!
Instead of realizing how valuable a little stack of gold coins is, you will be actually realizing is how little the value of our daily money has become compared to how valuable just a little gold is. Money just doesn’t seem to hold real value the way gold does, and now it takes a whole lot of money to buy a little bit of gold.
Then you will likely put the coins in a safe place and KEEP them.
Gold is “real”, and money is a “promise”. We don’t trust the promise as much as we trust the gold.
Real estate is called “real” estate, because, like gold, it is real. You own it. It is there, and it is pretty hard to lose. With interest rates low and prices for real estate soft, this is the perfect time to convert some of those “promises” to something real, something with real value … something you will want to keep.
Call me … 808-885-6061 … I can and will help.
