Legendary investor Jim Rogers, who has large positions in gold assets, stated in a recent interview with GoldMoney that he expects gold to keep falling in value.  That is bullish for the real estate market as when gold is weak, housing is strong.  There are many reasons for this, which are all very encouraging for real estate investors as one of the best financiers in history projecting that gold will plunge even more in value.

 As the chart below shows, the exchange traded funds for gold (NYSE: GLD) and homebuilders (NYSE: XHB) move in opposite directions.  The main reason for this is that gold is a historic safe haven asset.  When an economy is weak, investors and speculators will buy gold.  When an economy is weak, the real estate sector is also declining.  In major economies such as the United States and China, real estate provides about one-fifth of the gross domestic product.  So when the real estate sector is hurting, so is the economy!big chart

Rogers does not expect for gold to recover anytime soon.

In the GoldMoney interview, "Nobody gets out of this situation without a crisis," Rogers stated that the decline in The Yellow Metal was far from over.  In his response to a question about the future of The Yellow Metal, Rogers, who owns a great deal of gold assets, stated:

'Unfortunately from my point of view, and I own gold and haven’t sold any, we are in a long overdue and much needed correction. The anomaly was that gold had been up 12 years in a row. That’s not normal, typical action. It’s abnormal, which worries me and should worry all the gold bulls. It has now corrected for some 18 to 20 months now. I find that encouraging. I mean, I don’t know, because I’m not a very good market timer, but I do know that most corrections go on long enough to scare a lot of people and scare them out of their positions, and that’s what I would expect to happen.

I’ve had people write to me and say: 'gold cannot go down 30%', and I say: “turn on your computer. It’s there.” There are a lot of mystics that are still true believers. Until it scares a lot of people the correction is not over. I would certainly like the correction to be over this afternoon and see gold go to $2,000 or to $3,000, but that’s not reality."

What is "reality" is that real estate prices in the United States continue to soar.

Over the past year, starts, sales, and pending contracts are all much higher.  What is down is home inventory, which reveals that more are buying than selling.  Most important of all, consumer confidence is up, which means Americans are looking to buy real estate again.

As Rogers stated in his interview, this trend will continue as gold will continue to fall.  That is an indication that investors favor assets such as real estate and stocks, which gain from a stronger economy, not gold which rises when consumer confidence declines.  Look for American housing prices to rise even more as gold plummets even more, which is bullish for not only real estate investors, but the global economy!