Ummm you made me think a bit there- very interesting questions. let's hope i can answer it in a way you will understand.
Firstly some background information on currency and mortgage in general.
1. When currency goes up - economy starts to fall ( due to lack of exports) = less productively = less jobs = interst rate will likely to Fall.
2. Each country's currency movement affects world/ foreign currency ( like a balance beam) - that's how currency works, what is XX currency worth COMPARED to YY. THIS IS THE SAME FOR GOLD!!! Buying gold in China for cheap doesn't mean the gold is worth more in Australia - even through it SELL's for more, you have to look at the currency conversion and GPC to compare how much is that "gold" really worth. it's the same comparatively.
3. Property Like Gold is a Physical Asset/ item- it can APPREACITE in value and it does.
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Firstly The only time i can think of, where gold price soared to a premium compared to it's currency is Indonesia. 1kg gold = $50,000 aus
4.5 kg of solid gold = can buy you a home in indo.
$2.1 Million IDR = can buy a home in indo
So in this real example - gold seems like it's worth more then IDR 9( indo currency)
But how much does 4.5kg worth of gold cost TODAY ? = $2.1 Million IDR
So if you bought gold 10 years ago for half that price, then you made your self a baragain- the power of a appreciating asset,
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Secondly, your thinking and calculation is correct- IF the gold price did go to $20,000 then having 10 gold coin would pay the mortgage at $200,000. So in your example the 10 gold coin you now have (which has appreciated in price) = the house value. having said that - chance of your gold price going up to that sort of amount ( where it equals a home value_ happening is close to 1/1000000000, just look at history - when Greece's economy collapse this year! their currency drooped 80 points ( 44%) - the gold price went up by 5% only( short ( short period of time) , but other foreign currency soared. ...home value SOARED ( 30%)
So in summary, if currency drooped and your gold price went up, home value would mostly go up with it! - as long as ppl NEED for a home is the same - it will appreciate with the time.
