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Should we sell our house, then rent and invest in gold, or just buy a smaller house?
We want (need) to move to a different area but house prices there are higher, although they are continuing to fall with the current market conditions. Would moving there and renting for one year, putting the £40-50K of cash we would make from the sale of our current house (after paying the rest back to mortgage provider) into an investment, such as gold (?), be a wise move, with a view to purchasing in that area a year later when house prices may have fallen a further 10%? Or could our £40-50K also suffer a similar, or even worse, loss? Would it be better to just buy a smaller house for now? How safe is gold - is that the safest thing to do with our money?
Will probably consult a financial advisor but would be interested to hear what people out there have to say.
Oh, we live in the UK (Midlands), i.e. we're talking about the sterling (GBP) here, although I appreciate there's similar problems globally at the moment.
3 Answers
- Anonymous1 decade agoFavorite Answer
I am also an american. You need to talk to an estate agent that is familiar with what is happening to home values in both the area you are leaving and the one you are moving to. No one can be sure when prices will bottom out so waiting to buy again may not be your best option. You do need to keep a roof over your head and what you pay out in rent will probably be greater than what you can earn by investing the money you expect to net from the sale of your current home. If you were to choose to invest and wait then you DO NOT want to take any risks with the money. Since this is money that you will definitely need to use in the near future you need to put it into a safe investment. That means something that does not fluctuate in value. Gold can go down in value as well so I would avoid that.
Source(s): I am a retired bank manager/investment professional - dnldslkLv 71 decade ago
Im an American unfamiliar witht he specifics of your country, but in general I believe you should live in and know an area before buying a house there. You're understanding of the new area will vastly increase after a year or so.
More than economics should be a part of your decision.
- 1 decade ago
Sell your home, buy one just big enough for your needs (not your wants) and save the rest as cash in a safety deposit box. Or you could send it to me and I could loose it for you just as fast as an investment company!
