Property Prices Outrages, What Should I do?

[alanwatts6253]

Hey Guys,

I was wondering if you guys had any advice for a 28 year old.

Me and my girlfriend will soon be looking into buying our first property and luckily we will be able to buy it outright without any mortgages. That said, at the moment the property prices in my country have reached outrages levels which I don't believe is sustainable for long.

I feel that if we buy now when prices are at an all time high we would be doing ourselves a disservice as we could buy a better property if we wait for the prices to adjust(This could not happen but we are willing to take the risk).

Our country is part of the EU so we are weighing the option to emigrate to another country for a few years before coming back here to purchase property. Who knows, maybe we may even end up staying abroad.

The only problem is that I don't know what to do with the cash in the meantime, I don't want to just let it lose value in the bank, I would like to at least earn some interest on the money.

What do you guys think I should do with the cash, keeping in mind that I prefer safety over earning potential and also keeping in mind that the government only guarantees just a proportion of the amount in the case that the bank defaults?

 

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[NanoDrake]

In Real Estate, if you apply the 80/20 rule you will get that amongst many things, 2 factors carry the majority of the value: the location and the price.
If you buy an apartment in central London and stay committed long term, price is not as relevant (yes it might go down but in 15/20 years for sure will be only up, unless the Russians decide to nuke the hell out of London) if you are considering to buy a nice apartment in some decent areas, then also price comes into place and your consideration of pricing is actually correct.
I would stay cash till the next cycle comes into place.

Where I would put my money? it really depends:
A) how much you want to risk your capital
B) what is your plan for that cash? just leave it there and take even a small1%? or go full in with stocks?
C) what income plan you have for the next 5 years? if shit hits the fan and you get fired/bankrupt/sued what and where is your safety net?
D) You talk about Europe, well, you know, Europe is made by 28 EU countries + others in the economic zone, where would you go? Malta? where RE prices soared? CZ? same story...retire in a tiny Croatian island? go to Athens and try to usurp apartments from squatters?

There is no "do this and do that" answer. if you are looking to educate yourself on possible options do the following:
A) talk to your bank
B) talk to an investment firm
C) talk to an insurance firm.

then decide what is for you.

 

[minivanman]

I see a potential problem before looking at any property.... you say your girlfriend and you. Who will be the owner?