You are given £100k - what do you do with it?
- Thread starter intelligentppc
- Start date
Spread the risk. If I have (or a friend or relative) has a good business or idea that needs some investment, I'd invest some in to that. Some towards a property, if I don't own my home I'd put a deposit down or BTL for investment purposes.
And, well if I'm given it unconditionally, treat myself to a new car!
And, well if I'm given it unconditionally, treat myself to a new car!
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It's interesting that so many people still think BTL is a 'business' worth entering ...in 2001, yes, but IMHO housing is the last shoe to drop (remember gold, look at oil, non US currencies), when it does...oh my word (it's going to be stretch to imagine that in such a deflationary global phase to think that housing will hold up)
I guess the British love afair with 'going large on housing' & renting it to one another is going to be a hard habit to break.
To the OP £10k 'dabble fund' to short the Euro, Short the Yen, Short GBP (all vs US$) ...& eventually (6-8 months or so), go long on gold.....put the other £90k towards buying/starting a small business & do some proper work (none of this get a 'Buy to Let & sit back' melarkey)
I guess the British love afair with 'going large on housing' & renting it to one another is going to be a hard habit to break.
To the OP £10k 'dabble fund' to short the Euro, Short the Yen, Short GBP (all vs US$) ...& eventually (6-8 months or so), go long on gold.....put the other £90k towards buying/starting a small business & do some proper work (none of this get a 'Buy to Let & sit back' melarkey)
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I have a concept kind of like Pukka Pie selling ready meals to pubs. The product hasn't ever been done before it is completely unique but at the same time familiar to the UK market, has as many varieties as you can imagine, and it is amazing with beer. Easy to mass produce and any minimum wage 16 year old could reheat them in the pub perfect everytime. Also no microwaves involved.
It's not pasta by the way.
I'd invest it all into the production facility, refrigerated van, advertising & sales people and running capital.
Ciao
It's not pasta by the way.
I'd invest it all into the production facility, refrigerated van, advertising & sales people and running capital.
Ciao
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Why not? My wife buys properties at auction, we have 4 BTL now and only started in 2010. In fact one we are toying with selling that we got for 56K has been valued at £110K.
Can't get cheap properties anymore? Wrong, even last November found a flat in London for under 100K, not a great area, as you would expect but people still live there.
Not a fast buck by any means but look at property over 30-40 years, always holds up. Even those in -ve equity slump in the mid 80s would have recovered had they stayed.
Gary
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I'd give it the nice Nigerian guy who always emails me about his family. I'm sure 100k would provide all the medical expences and more for his dying grandparents, his cancer stricken mother and now to compound his bad luck, his wife has been involved in a near fatal car crash. He's in a bad way, I feel so guilty.
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Fascinating. I'd be interesting to know what you're basing this on.
House prices are essentially driven by two things - supply and demand curve, and by affordability. I can't see either of these changing drastically in the near future, so a sudden drop in prices is unlikely.
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That's just the point ...you think demand is healthy...until it stops (llook at gold....US$2000 an oz was a racing certainty, then it tanked, look at oil 50% fall in 6 months - those markets were healthy until sentiment changed) We've not really had a proper house price correction now since the mid eighties (ok, ok, outside of London there have been a few small blips, but the goverment made sure they were just that - blips). There'l be a trigger outside of Goverment control ...probably in the form of a sterling crisis (the only reason we've not had one yet, is because the markets have focused on worse economies...it's like an ugly contest - fortunately for the UK, there have been more ugly countries than the UK). When we can't finance our defecit, the BOE will have no option but to crank up interest rates...high house prices & high interest rates = major house price falls.
When you see articles like this.....
The five Mudeford beach huts up for sale for a total of 1m (I can't post links yet, but google that phrase)
....you know you're in the last huffs & puffs of a very long housing boom. As for 'always safe with property'...by & large I tend to agree with that sentiment...if you are young & have age on your side. But for anyone 55yrs+, I'd be giving BTL a very wide birth & certainly not entering the market now!
There's also the spectre of deflation (notice how Governments of the world all quake in their boots at the mere prospect), well, thanks to oil, people's mindsets are going to start turning fast ...& housing certainly won't be immune. How about UKIP forming a coalition...their policies on immigration aren't going to be supportive of the present very high house prices etc.
My point is you wont see it coming, until it's here, & because housing is relatively illiquid, it'll be hard to get out.
Off topic - it's bordering on criminal how the Government - rather than let market forces come into play - have sought to socialize the 'cost' of high house prices by putting in all manner of schemes/props to keep prices artificially high ...it's an outrageous ponzi scheme which only rewards those already in (& is supported by those at the bottom - typically the youngest in our society) Governments didn't meddle when prices were rocketing, they shouldn't be meddling to try & keep the prices high (but they have to, else the banks would all fail).
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Did the person who gave me the 100K actually ask me to make more money with it, or did they just give it to me? If they just gave it to me, I'd take a few years out and enjoy living off the 100K - then worry about making more money when that ran out.
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Housing isn't a commodity, but we'll skip over that.
Oil has dropped in value because supply has significantly outstripped demand. China's cut back a bit on consumption, US is shifting to shale gas,Saudi Arabia are pumping like crazy to put off American investment in Shale, and most of the producers are quite happy to pi$$ off Russia.
How can you compare that to housing?
Oil has dropped in value because supply has significantly outstripped demand. China's cut back a bit on consumption, US is shifting to shale gas,Saudi Arabia are pumping like crazy to put off American investment in Shale, and most of the producers are quite happy to pi$$ off Russia.
How can you compare that to housing?
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I would...
1. Travel parts of the Far East, Australia & USA (5-10k)
2. Invest some in my business for advertising (15-20k), I would try to grow it on a global scale.
3. Add to rest to my savings to buy a property to rent out or to live in (60k)
5. I'd set up a new online website selling a new line of products similar to those I already sell - otherwise I would touch on a different market that interests me.
4. If there's anything left I would spend treating myself or I would just save.
1. Travel parts of the Far East, Australia & USA (5-10k)
2. Invest some in my business for advertising (15-20k), I would try to grow it on a global scale.
3. Add to rest to my savings to buy a property to rent out or to live in (60k)
5. I'd set up a new online website selling a new line of products similar to those I already sell - otherwise I would touch on a different market that interests me.
4. If there's anything left I would spend treating myself or I would just save.
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It's more a monetary deflationary cycle that central bankers quake in their boots about. Price deflation is actually good, what isn't good is money supply deflation. In lay mans terms that essentially means it isn't good when banks stop lending because over 95% of the money in circulation is bank loans that are destroyed when repaid, therefore new loans need to be created every year at least as great as all the loans in the previous year, or we experience money supply deflation, aka depression/recession, or a lack of actual money in the system.
The natural cycles in the economy we experience is the result of the debt bubble rising and rising, leading to increased economic activity due to all the new money floating around, and then as everyone pays off all their loans the banks are legally obliged to destroy the principle of the loan and therefore the bubble bursts and people default because money that was previously in the economy has been taken out.
Central bank's main job is to keep an eye on this natural debt cycle and to encourage banks to boost lending when it comes to the end of the cycle. Basically their job is to keep the balancing act going as long as possible.
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S
sirearl
Skip that would that be because you are wrong ( try looking up thr meaning of commodity).
Try telling that to the US housing market.
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No offence taken, my point being, both were markets in which prices (& sentiment) were bullish ...until sentiment changed.
Sentiment really drives prices (both to the up & downside) ...at the point when Gold nearly breached $2000oz all the usual arguments were rolled out to support why it would (in much the same way as all the usual arguments are rolled out to support never ending house price increases), then sentiment changed - Gold tanked. And once sentiment changes, there's nothing quite like an illiquid, geared investment like housing to want investors to run down the drive & dump it in a skip as quickly as possible.
It's exactly when you think it can't happen (due to all those years of never ending house price increases...high immigration, restrictive planning blah blah) that it will happen. Just be thankful that, for now, you've the government on your side who - in order to protect the banks - have rigged the market....and encouraged those at the bottom of the pyramid to over stretch themselves....but you can't manipulate a market for ever (ask the Swiss Government)
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Someone I know buys low end property and make it into nice budget lettings because they want to help others and improve low end properties. In the process he has earned a good reputation and has people approach him so they are only empty when he is refurbishing them. It is also a sound business.
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Skip that would that be because you are wrong ( try looking up thr meaning of commodity).
Try telling that to the US housing market.
from Wikipedia... The exact definition of the term commodity is specifically used to describe a class of goods for which there is demand, but which is supplied without qualitative differentiation across a market.
I'll not bother waiting for you to admit you're wrong, again. I've learned my lesson the last 500 times.
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