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Housing risk

One is that housing is illiquid: it's hard to sell. Even in the best times, selling takes weeks and involves the stress of dealing with lawyers. In the worst times, it can take much longer.

This doesn't just mean that property is an unsuitable investment for anyone who might need quick cash. It also means the housing market is cyclical, in the sense that property becomes even more difficult to shift at a good price in an economic downturn. This makes housing a poor store of wealth, in the sense that we sometimes need wealth most in bad economic times, but these times are just when property loses value and becomes harder to sell.

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