Gold vs Real Estate: What You Should Know

Both gold and real estate have long been preferred investment choices for Indians. They hold sentimental value, too. We compare the two and assess if one or both assets can complete your portfolio

- Shivangini Gupta

When our grandparents and their grandparents spoke of wealth, they never talked about mutual funds or initial public offerings (IPOs).Their definition of wealth was rooted in two tangible things: real estate and gold. For generations, these assets were the bedrock of financial security in India.

Gold, even in the form of jewellery, has been and still is seen as an emergency backup that can be pawned for medical expenses or major goals like children's education and wedding. On the other hand, buying a home, for most families, is the largest investment they ever make, and it carries both financial and emotional weight.

Gold is back in vogue, not just as a hedge against inflation but as a global safe haven for a world rattled by geopolitical tensions. Central banks are piling it, a clear signal that even the biggest players see its value. Real estate, after years of stagnant and in some cases negative returns, is also booming now. The money though is mostly flowing into high-end properties, squeezing the affordable housing space.

Both assets have their merits and demerits. But can they form the entirety of your portfolio?

What Gold Offers

Whether as jewellery, coins, or financial instruments, gold remains a store of value when trust in other assets falters. Typically, when markets slide, or the rupee weakens against the dollar, gold climbs. It is no coincidence that the Reserve Bank of India (RBI) expanded its gold reserves from 695 tonnes in FY21 to nearly 880 tonnes by FY25. Central banks worldwide are signalling confidence in gold as a reserve asset.

Recently it has dazzled investors. At the end of 2024, 24K gold was trading at ₹7,718 per 10 grams. Gold had rallied to its all-time high during the first half of September, 2025 registering a year-to-date (YTD) gain of 44 per cent reaching ₹1,06,863 per 10 grams, according to data from the World Gold Council.