Investors choose property as cash becomes a ‘liability’

Brits would rather invest money in property or stocks and shares than keep it as cash, despite 12 months of falling house prices and a volatile stock market.

Research by the Motley Fool found that 30% of UK adults would invest a £50,000 windfall in property.

A quarter (26%) would choose shares, whilst 17% would opt for bonds.

Fifteen percent said gold is the best option, whilst cash was the least favourite chosen by just 12% of those polled.

David Kuo, Motley Fool website director, said: “Cash is no longer king in the eyes of investors.

“It has been relegated to the status of pauper.”

Kuo explained: “Holding onto cash could be a liability if the government accelerates quantitative easing.

“History tells us that increasing the supply of money can be inflationary.”

Kuo believes that with the risk of high inflation looming, investors are best to buy assets that can outpace inflation.

“One of the best ways of ensuring our money holds its value is to invest in assets that can beat inflation,” Kuo said.

“Traditionally, these have been shares and property.

“So, for those who already own a house, it is vital that they spread the risk by investing in other inflation-beating assets such as shares.

“Putting all our eggs in one basket is only ever a good idea if we enjoy our eggs scrambled, concluded Kuo.”

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