This paper explores optimal consumption and portfolio decisions in the presence of risky house prices. We assume that changes in real interest rates and future rents directly impact house prices. A novel aspect of our model is that rent inflation rates and consumption inflation rates are cointegrated. We show that the individual prefers to be a home owner when young and a renter when old. This motives the design of so-called reverse mortgage products. Furthermore, she invests significantly less pension wealth in inflation-linked bonds, as compared to conventional wisdom. Finally, we find that the optimal mortgage changes from fixed-rate to adjustable-rate as the individual becomes older.