Monday, November 14, 2011

Property a poor investment choice for the short to medium term

Survival guide to global meltdown

There are fears that the crisis in the eurozone could spark a second, more serious credit crisis, "like Lehman Brothers on steroids", as some commentators have said. If banks are concerned about who will be left holding debt that can't be repaid, they will quickly draw their horns in and stop lending to each other, as well as consumers and small businesses. This could mean mortgages cost more and become more restricted, said David Hollingworth of brokers London & Country – particularly for those with relatively small deposits or little equity in their home. Mortgage borrowers have been some of the few winners from the current global instability, thanks to low interest rates. But if you are considering remortgaging soon, don't delay.

Posted by quiet guy @ 10:00 AM (1244 views)
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3 thoughts on “Property a poor investment choice for the short to medium term

  • “Property a poor investment choice for the short to medium term”
    Exactly where in that article does it say this?

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  • general congreve says:

    Plagiarists and not even timely plagiarists, laggards to boot!

    Their recommendations leave a little to be desired though. Gilts?! Sterling?!

    An imperfect, but otherwise suitably gloomy article but overall, heading in the right direction. 8/10

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  • @GetALife

    Oh, c’mon. I had to summarise my point in one line.

    ‘There are fears that the crisis in the eurozone could spark a second, more serious credit crisis, “like Lehman Brothers on steroids” … This could mean mortgages cost more and become more restricted’

    ‘According to HiFX, the currency broker, when compared to 2007, UK investors with Spanish homes are at break-even point at present, while those in Greece are sitting on an average 14pc gain and those in Italy have a 19pc gain. The question now is do they bank any gains, or at least get out without a loss? If the crisis escalates to the point that countries are forced to exit the euro, this could cause a major devaluation, which could seriously affect those who own property in these regions.

    I accept that those who have already bought property before, say, 2005 might be OK and UK property owners are relatively better off than their Eurozone counterparts but the only comments about buying now are to watch out for another credit crunch and decide if you should risk further losses in the Eurozone – hardly bullish is it?

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