Tuesday, September 23, 2008
I watched a really scary program about property last night. Many of the people they interviewed have had buy to let property for years and are making money out of it even in today's economic climate. However, the scary ones were the people who were sold property a few years ago as part of a sales drive by particular companies. These were people who had never owned property before and did not understand the risks. One person had lost tens of thousands of pounds. It made me think hard about investing in property. It is okay if you can buy it outright and then if you have no tenants for a while you will not have to pay too much money out. But if you have a huge mortgage and have no one renting you have to foot the bill. Also it may not be that easy to sell the property so you have this huge debt constantly draining you. If you invest in shares you can more easily sell them. Also if the market falls you will not have to pay out money but just the value of your investment will fall. It certainly made me pleased that my money is tied up in shares and not property.