How to hedge the housing market

[moneymaker]

Rates are low now but everyone pretty much agrees that they will go up eventually. When rates go up home prices will most likely go down. Hence the catch-22 is buy now at high prices or pay high interest rates later. My solution is invest in commodities such as SLV now, so that when rates rise money will be protected from inflation, then sell silver shares to buy house and during the next cycle refi said house when rates go back down.

[spdrun]

And vote GOP next election, since they seem to be less into helping mugs who got in over their heads as far as housing.

[The-Shoveler]

[quote=spdrun]And vote GOP next election, since they seem to be less into helping mugs who got in over their heads as far as housing.[/quote]

I would respectfully disagree on this one, seems that housing tends to go up more during republican administrations at least during the last 30 years.

Was it not Bush who said “everyone should own a house”?

[Coronita]

Why bother hedging against a primary? You still need a place to live.

If you’re not in a hurry to try retire early and reduce your expenses as close to 0, then having a ridiculously low payment 30 year fixed mortgage that is lower than rent prices is already you hedge.

[spdrun]

I would respectfully disagree on this one, seems that housing tends to go up more during republican administrations at least during the last 30 years.

We also had a beautiful crash during Bush II. Obama seems to want housing for everyone, as evidenced by his appointment of Mel Watt to the FHFA chair. Vs Ed DeMarco, who actually had some business sense instead a political agenda of getting rubes to buy houses.

[Jazzman]

You need to be on the right side of prices not rates.

[Coronita]

[quote=Jazzman]You need to be on the right side of prices not rates.[/quote]
This isn’t about new purchases. This is about existing home owners.
You just need to be able to afford what you want to buy and make sure you live within your means.

[CA renter]

[quote=Jazzman]You need to be on the right side of prices not rates.[/quote]

^^^This.^^^

Buying at market lows (or at least “normal” levels) is far more important that buying with low rates.

[gzz]

I posted here a few months ago that a good way to hedge a housing decline was to short QCOM. Pretty good advice in retrospect!

http://piggington.com/qcom_proxy_sd_housing_market

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