Investing before property

Hey all,

I would like to ask a bit of advice in regards to investing before buying a home.

In the next 3-5 years I would like to purchase a property, and I am looking into investment strategies before, so the money I have saved up and will be adding keeps on working for me. I know there are first-time homeowner ISA schemes especially for this, but they come with a property value limit of 450K. That concerns me, as that does not take you far in London and I would rather look at something higher.

What would you recommend to get the most value out of investing in this relatively short term?

Thanks!
B.

Hi Barbora :wave:

Generally, if you are investing and you want access to your cash in the short term, you are better investing your money in a cautious/low-risk portfolios. In these types of portfolios, your investments are weighted more traditionally in safer investments such as: bonds and cash. Meaning that your money is weighted less in riskier investments that are more susceptible to market volatility. :chart_with_upwards_trend:

Volatility is the amount your money fluctuates in value. As time goes on, day to day volatility becomes less and less important. So if you plan on investing for the 5+ years, a higher risk portfolio could be a viable option. But in the short term, it is better to go for a lower risk because if the market suddenly drops, you may have to wait a while for your investments to recover. :clock1:

Other options could be to save your money rather than invest. A lot of high street banks offer fixed rate introductory offers on Cash savings or Cash ISAโ€™s, so it might be worth checking them out as well! I found this article on The Money Saving Expert which you might find useful. Thereโ€™s also a great article here on saving for a mortgage. :smile:

With anything like this, I have to caveat that this isnโ€™t investment/savings advice. This is more general information you can use when making your own decision. With any sort of investment, your capital is at risk.

All the best,
TJ

1 Like

Our Co-Founder Tom did a video explaining our risk levels! You might find this useful! :smile:

Thanks Tom, this is great!

1 Like

No problem! Let me know if you have any questions. :smile: