Are Prices Too High?

Hey there,

Take a look at the screenshot above.

The red is the Case-Schiller index, showing home prices over time. The grey is inflation over time. The chart goes from 2000 through 2025.

A ten-second quick pass analysis of the chart would make you think real estate is getting pretty rich in its pricing.

Honestly, a lot of things “feel” rich in their pricing so this might back up our bias.

But, take a look at this next chart:

This is the same Case-Shiller index but priced in gold. Meaning instead of valuing houses in dollars, they’re valuing houses in gold.

Not a bad way to measure things because the dollar was tied to gold until the 1970s.

What we see now is that houses are actually cheaper today than at nearly any point since 2000, when priced in gold…

But this doesn’t just apply to real estate. Take a look at the S&P 500:

Now let’s price it in gold:

We could extend this idea to farm ground. In 2017, one acre of farm ground in Northwest Ohio would sell for $7,000 - $8,000, roughly. Priced in gold in using $1,250/oz, that comes out to ~6.4 oz of gold to buy one acre.

Today in 2025, farm gound in the same area trades anywhere from $10,000 - $15,000 per acre. Priced in gold using today’s price, $3,300/oz, that comes out to ~4.6 oz of gold to buy one acre.

It’s actually gotten cheaper…

The problem is cash flow. We get paid in dollars, not gold, but our dollars have become less valuable and cash flow is at times struggling to keep up.

Just providing a different angle to look at things with this.

*Not saying buy gold. I’m not buying gold.  

Questions always welcome!

Nate & Steven
Rust Belt Capital, LLC

www.rustbeltcapital.com

_Disclosure:
Rust Belt Capital, LLC is not a Registered Investment Advisor. Investing involves risk, including loss of principal. Past performance does not guarantee or indicate future results. Any historical returns, expected returns, or probability projections may not reflect actual future performance. While the data we use from third parties is believed to be reliable, we cannot ensure the accuracy or completeness of data provided by investors or other third parties. Rust Belt Capital, LLC does not provide tax advice and does not represent in any manner that any outcomes described herein will result in any particular tax consequence. This is not an offer to buy or sell any security. Offers to sell, or solicitations of offers to buy, any security can only be made through official offering documents that contain important information about investment objectives, risks, fees, and expenses. Prospective investors should consult with a tax, investment, or legal adviser before making any investment decision. Distributions or profitable investments cannot and are not guaranteed. Not intended to be tax advice and should not be solely relied upon to make an investment decision.