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Protecting With Real Estate

March 7, 2011

I’ve given a lot of thought to real estate as a method to protect my assets from the dollar dropping. Obviously if this is my concern then holding a mortgage is in theory great, assuming the inflation hits the housing sector. I am not so certain that in the event of a dollar collapse that US real estate is where you want to be, given that property values might rise but if you wanted to sell I dont know you would find a buyer. The other major issue is property taxes, which are undoubtably going to rocket up.

Farmland is interesting because of its production, and the fact that the food you produce will rise in value.

International real estate is also interesting because it should hold its value and be out of reach of the US government tax policies, etc. How realistic it is to buy land in a place like Panama is another issue, unless you are a millionaire.

That leads me to my latest thought, which is to investigate real estate in states with low or no deficit. They should be more insulated from tax hikes and will be more likely to push back on the federal government (discuss this at a later time).

This is from stateline.org:

Its from last year, but New Mexico, North Dakota & Wyoming are the only states with no deficit. South Dakota & Vermont both carry low deficits. Ill be investigating these for property purchases.

Deficit in ($) millions Deficit as percent of spending Rank by percent Passed or Proposed Tax/Fee Increase?
Alabama 500 6.2 34 no
Alaska 1644 46.2 1 no
Arizona 1843 19.4 6 yes
Arkansas 223 4.7 41 yes
California 34600 30.0 3 yes
Colorado 1450 14.4 9 yes
Connecticut 2350 13.4 14 yes
Delaware 300 8.1 30 yes
Florida 2000 6.8 32 yes
Georgia 1341 5.8 37 yes
Hawaii 80 1.5 47 yes
Idaho 314 10.6 25 yes
Illinois 4092 11.3 22 yes
Indiana 1650 11.4 21 yes
Iowa 413 6.0 35 yes
Kansas 954 14.2 10 yes
Kentucky 620 5.8 38 yes
Louisiana 618 6.3 33 no
Maine 518 13.4 16 yes
Maryland 1616 9.8 26 yes
Massachusetts 3650 10.7 24 yes
Michigan 1761 12.8 17 no
Minnesota 2723 13.9 12 no
Mississippi 96 1.8 46 no
Missouri 1425 12.4 18 yes
Montana 116 5.7 39 yes
Nebraska 524 13.4 15 yes
Nevada 565 19.9 4 yes
New Hampshire 206 11.8 20 no
New Jersey 5700 18.0 7 yes
New Mexico 0 0.0 48 yes
New York 12000 19.4 5 yes
North Carolina 2000 9.7 27 yes
North Dakota 0 0.0 49 yes
Ohio 2720 8.4 29 yes
Oklahoma 885 11.8 19 yes
Oregon 2167 31.0 2 yes
Pennsylvania 2433 7.8 31 no
Rhode Island 200 5.0 40 no
South Carolina 1048 13.5 13 yes
South Dakota 54 4.2 43 yes
Tennessee 511 4.5 42 no
Texas 7800 17.0 8 no
Utah 117 2.1 45 yes
Vermont 30 2.3 44 no
Virginia 2050 11.3 23 yes
Washington 1467 8.7 28 no
West Virginia 250 5.9 36 yes
Wisconsin 2372 14.0 11 no
Wyoming 0 0.0 50 no

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