I wouldn't say perfect-- in that there is no strong reason to believe that the returns on your ibonds will reflect the amounts you need for your down payment or the discounted future value of your mortgage payments (particularly since CPI excludes housing)... but it might well be the best option available if you have a short time horizon.
For a long time horizon, broad market index investments have reliably outperformed home prices.
It would be an interesting backtesting question: Imagine you have enough money for a down payment on a median priced home, consider two options: put the money into ibonds vs put the money into a market index. Then after X months, what percentage of the time is the investment still able to meet the downpayment requirements of a median priced home (at that time, which might be more or less than before)?
It's not guaranteed that the ibond option will be less volitile because what we're comparing is market vs home-market, so it might not even win out over short term. For really short windows the ibond interest clawback will hurt it too.
Since home prices have increased substantially faster than inflation the success rate of the ibond option will (assuming the future is like the past) tend to 0% success for longer time windows. Since market returns have outpaced housing costs, the market investment will tend to 100% on longer time windows.
Personally, I might well just go the market index route: Even if we presume the ibond success rate is better in a short window (I think that's a reasonable assumption), "It always takes longer than you expect, even when you take into account Hofstadter's Law" and the market index is the clear winner in the long term.
It would be sad to constantly be expecting to buy a house 1 year out, invest in underperforming investments, and as a result never be able to afford a house because they were always escaping your investment!
