...or perhaps not buying a house after all

[ciphergoth]

...at least for a while.

Met up with babysimon at BU last night. He made a *very* persuasive case that now is not a good time to buy. Various folk made the opposite case, but his was backed up with detailed quantative historical data. I'm sore about it, but I'm convinced. It's sad but at least it means I'll be able to get a rather better property for the same money when the crash comes.

Just spoke to an investment advisor, who said if I was only investing for a year or so and then hoping to buy property, I should put my deposit in bonds. I'll also of course put the maximum I can into an ISA. It'll keep 'till I need it.

So I guess I'm looking to rent once again... but we're not in a hurry.

Comments

[lovingboth]

I think he's right, but a crash is an 'if' not a 'when'. With low interest rates, mortgages on stupid prices at silly multiples of earnings remain affordable.

I wonder if there's a financial derviative that enables you to make a bet on house prices? It'd be very interesting if so, because you'd be able to cover the risk of prices falling after you've bought.

Bonds are less of a good thing than they used to be. Because of the stock market losses of the past few years, lots of insurance funds have bought large quantities of bonds, so the price has fallen.

How much of risk do you want to take with the money?

[babysimon]

I wonder if there's a financial derviative that enables you to make a bet on house prices?

You used to be able to short house prices by spread-betting. The trouble was, as with all shorting it was very time-dependent. You had to predict exactly when the crash would happen.