Quote:
Originally Posted by ishoot308
Unless your money in the bank is earning more than the rate of inflation, (very rare with rates these days) wouldn't that be considered a "negative return"?
Real estate, while cyclic, seems to always go up in value in the long run...
Dan
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Yes if interest rates fall below the rate of inflation over the life of the investment it would be no different than the illustration I'm making with real estate. The investment will gain value over time but will produce a negative return. Just as a piece of property's carrying costs, specifically taxes, on an annual basis exceeding the increase in "value".