Author Topic: Selling house...where to invest or save equity until next purchase??  (Read 2141 times)

hollim33

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We just unexpectedly sold our house. It was not on the market but we were offered a price we couldn't refuse. The problem is we're not ready to buy. My husband is actively job-searching and we're really hoping to relocate. So it looks like the best plan is to rent temporarily until we figure out our next step. So my question is where do we put our money from the sale of our house? Is there anyway to invest it temporarily so that we could still access it if we find a new home in a few months? On the other hand, it could be a year or so...

Thanks so much! We are just starting our Mustachian journey and have a lot to learn!

iamlindoro

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Re: Selling house...where to invest or save equity until next purchase??
« Reply #1 on: October 21, 2013, 07:22:57 PM »
If your time horizon is 6-12 months, you're likely risk-averse (ie, you don't want to potentially get a higher return but also potentially lose money) so index funds are probably out.  Less than 12 months is really short, so really the only choice is a short term CD or a decent-yield savings account (presuming the USA).  It's not going to return much, but it's better than nothing.

dadof4

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Re: Selling house...where to invest or save equity until next purchase??
« Reply #2 on: October 22, 2013, 11:23:12 AM »
You might want to to look at REIT's. Yes, they're volatile, but they will move (generally) with the housing market, so your buying power will stay the same. You'll also get rent in the form of dividends.
Putting it under the mattress or in a low yield savings account will guarantee real losses. If the housing market continues its upwards trend, you'll be in an inferior position 6-12 months from now.

lliang_chi

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Re: Selling house...where to invest or save equity until next purchase??
« Reply #3 on: October 22, 2013, 01:28:16 PM »
Dadof4, Not the OP, but you have a really interesting hypothesis on that. I'll have to keep that in mind.

hollim33

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Re: Selling house...where to invest or save equity until next purchase??
« Reply #4 on: October 24, 2013, 07:49:06 AM »
Thanks everyone! Never heard of REIT's so off to do some research!