Quote:
Originally Posted by john.wigley
Pretty much, Alan. In that year, Linda paid £6.7K for a nice one bed flat in a newish block in Mountsorrel, just North of the city. Unlike motor cars, however, which rarely appreciate, it went on to sell for considerably more than that just four years later when we were buying our first house together.
In contrast, my Mini, for which I had paid £2.2K new in 1978, sold for just £950. Cars may be fun and nice to have, but they are a depreciating asset.
The better investment was, is still, and, I think, always will be property. I just wish that I had realised that when I was younger, and invested so, instead of contributing, as was my wont, into pension schemes. A few may have performed well, but most seemingly not. The way mine is doing right now I'm convinced that I would have had more fun by feeding £20 notes into the shredder! 
Hey ho ...
Regards, John.
P.S. I sense a thread on alternative investments coming on ... J. |
You are so right John; on these little islands of ours where the already large population has increased by a third (from 50 to 67 millions) in my lifetime it was inevitable that limited supply and increasing demand would increase the value of land and houses. I suppose the cost of the average house in our nation has increased by about 27 times since 1977, so the cost of that 1977 Volvo 240 would today be £154,000 relative to property.
In my lifetime I have owned 9 houses; I only have two today, but in hindsight I'd have found ways to keep all of them (and maybe some more) - today I'd own a stock worth £4 to £5 million. Dan (who will be 18 in a few weeks) has realised the value of housing as an investment and is already planning to buy his first with some cash I'll give him on his birthday. I wish I'd had that foresight when I was 18!
A better bellwether for Bob's comparison might be the price of gold. It sold for about £85/oz in 1977, and today is £1,465/oz - so that is 17 times as much. By that measure the 1977 Volvo 240 would have cost the equivalent of £96,900 today.
I suppose one might conclude a few things. The first might be that new motor cars have become very cheap over the past 45 years, a similar equivalent to that 240 in today's market might be £30-£40,000 (I just looked up the XC40, which apparently cost £35,000). One might also conclude (as you have John) that whilst fun, motor cars are quickly depreciating assets.
It will be fine in the RB thread goes off on an alternative investments tangent for a while - it has previously taken us on many diversions away from a 1980 Volvo 244.
Another lovely day in paradise,
Alan