Buy to let a good move?

Conrad

dunstonh wrote:

Perhaps Conrad thinks the Daily Mail is a better source of information

Ive known lots of IFAs in my time. They are FINANCIAL ADVISERS yet they dont make anyone substantially better off in investment terms and indeed those I know have not made sharp investment decisions themselves.

Did your IFA advise you get into Gold in 2003 when it was 3 x cheaper?

How about B2L in 1995?

What about an E European property fund in 1998?

Did your tell you in 2001 that US property may well be about to boom?

dunstonh

Did your IFA advise you get into Gold in 2003 when it was 3 x cheaper?

How about B2L in 1995?

What about an E European property fund in 1998?

Did your tell you in 2001 that US property may well be about to boom?

You seem to think that IFAs should have crystal balls to guess the next boom area. It's easy to say what areas turned out to be good in hindsight.

They are FINANCIAL ADVISERS yet they dont make anyone substantially better off in investment terms and indeed those I know have not made sharp investment decisions themselves.

I think you misunderstand what the role of an IFA is and what CF21 allows us to do.

Anyway, most people are satisfied with double digit returns on average with investments appropriate to their risk profile.

Gorgeous_George

dunstonh wrote:

Risk isnt just price crash. If borrowing is involved you can be hit by higher interest rates and if coupled with a crash (higher interest rates would increase downward pressure on house prices), then you could find yourself unable to afford both mortgages (main residence and buy to let) but unable to sell the property because there is no market for it at that time or that property prices have put you into negative equity. A short period of this would increase short to medium term debts but a prolonged period of a couple of years would see many repossessions and bankruptcies (which further increases the downward pressure on house prices).

It's at that point that you get the smart money buying up the properties again.

I have to agree with all of that and that is why I say that all the risks need to be understood and mitigated against where possible.

My problem is with pension funds etc., where the managers take 1% or so of your investment each and every year. They carry no risk at all and 1% is a massive amount when returns are typically single digits.

GG

Chrismaths

I, however, am CF27 - investment manager. My clients bought plenty of gold miners in 2001 and 02. They started selling more recently when gold passed $600. In fact, in 2003, gold ranged between $320 and $420, so not 3x cheaper. Again Conrad, you seem to confuse reality and your imagination. In fact, you'd have had a better return from global equity markets than from physical gold. Anyway, this is one decision we got right. Another was Eastern Europe equities in 2003 (the EU convergence play). We get others wrong (latin america recently, we could have played Japan better, et alia). The objective is to get more right than you get wrong, not to get 100% right. We leave that to Daily Mail readers and journalists who can exercise their infinite skills of being wise after the event.