For the vast majority of people buying a property for a home will be the biggest financial decision they will ever make, and also the best one. It does seem to be more of a "British" thing than a European one though as a far higher percentage of Europeans are happy to rent their homes and don’t see owning a property to be as important as the British do. Sometimes in periodic downturns in the market some people start to wonder if this concept is flawed but just by looking at a few facts we can easily prove that this is not the case.

Worldwide property prices have shown a steady increase in value for decades and will continue to do so. House prices in the UK have risen at an average of 5% year upon year even allowing for some ‘housing slumps’. These are always compensated for by the property surges we see on average every 7/8/9 years. 5% down on a 300,000 house is an investment of 15,000. In any given year this house will rise in value by 15,000. Give a stockbroker 15,000 and see if he can guarantee you those profits year on year!

Consider putting 15,000 into your stockbroker’s hands and him getting a 5% gain for you which most would consider to be ok. Your profit would be 750. Compared to the average property increase figures previously mentioned it’s not too hard to spot the better investment and this is just for an average year. There are periods when we are having a property boom (every 7/8 years or so) and some properties can practically double in value in the space of a couple of years.

There will always be blips and temporary downturns in the market. These are always caused by other economic factors such as Government Policy, Oil Prices, what our American Friends have been up to, etc. This could be difficult for new homeowners who may be stretched a little but if you’re an established home owner then you just don’t try to move during these periods and wait for the good times to return.

If you look at it over a longer period of time, say you put 5,000 into the stock market in 1996 and the average S & P return would make that investment worth about 11,700 today which is an increase of 6,700. The average house price in 1996 was 70,000 and today that same house would have gained 50,000 in value if not more. The real estate market  consistently shows itself to be a substantial investment method to riches.

Home values over time tend to increase at a steady pace and can be less volatile as stocks can really shoot up and down. There has never been a time when the housing market has not come back up from the down turn in values. The reason is that the British have a real belief system and the desire to own their own home and will sacrifice and make it happen and this just keeps fueling the market.

If people are careful about when to trade up on their property they can also avoid the necessity of paying Capital Gains Tax which means over the years a person can develop a small house into a much larger one or even a portfolio of properties without paying Capital Gains Tax. Tax free investments is definitely the way to go!

There is no reason to fear home ownership in the market in the current market with all the doom and gloom around. Simply look for the type of property and payment mechanism that you can afford and resist the temptation to use your home for a "bank" when you need money as in an equity line of credit. The home will be by far your best asset in your future financial portfolio and will continue to make you feel secure in your financial future for the rest of your life. Everybody’s circumstances are different and a really important task is to make sure you are in the best mortgage for you! There are lots of different mortgage options out there and it can make a massive difference to your lif if the get the best advice for you.

Lots more people are now considering debt consolidation mortgages to help straighten out their finances as the current mini-recession takes hold. Significant savings can be made by consolidating higher interest debts in this way and it will be easier to sit tight and wait for the property market to recover.

SOURCE: Personal Loans Information

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