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Wednesday, October 31, 2018

Hard work of property investment




It is undeniable that property is one of the most attractive investments tools in the market but without sufficient knowledge or deep research, you will be burned because of buying the wrong product during the wrong timing and of course, wrong reasons. Even if a good property likes 1120 Park Avenue with little knowledge on property investment, you might not even make earnings but make losses.

Property investment what may seems like easy peasy net worth roller but it is a battlefield you will have to endure and like every war, before running down to the battlefield, you have to be fully equipped with ammunition and in this case it is knowledge. Many of them would take real estate research lightly and satisfied enough to depend on word of mouth or plain luck, hopefully like striking 4D or jackpot when the next transaction comes. If you can spend your time to compare your gadgets functionality, why not spare some time to compare the properties you desired? After all, real estate properties required heavy commitments.

Here are some of the areas you may master or furnish yourself with the real estate knowledge.
1. Enhance your knowledge by reading and absorb that knowledge.
2. Choosing your right asset – by researching the property internal and external factors that will cause the value movement.
3. Decide the best financing options for your property.
4. Familiarise with property laws and taxes.
5. Check in with your personal finances often.

Only two reasons when buying property – own stay or investment purposes. For investment purposes, it is either for rental income or capital appreciation and regardless, a successful investors must have a determine goal before stepping into the property investment field. Do not blindly purchase property for the sake of purchasing because what happen if you cannot afford the monthly instalment. When the repayment kicks in and your affordability has issues, this is boiling your ocean.
Speaking of affordability, it is vital to determine your affordability although you may qualify for loan because anything can happen such as retrenchment or financial emergency issues. Leveraging and borrowing to invest in property may sounds ideal but to qualify for a loan does not mean the successful way in property investment. Investors must take note of the risks that may arise and you will need to manage those risks. Have you ever thought of your back up plans in case anything can go wrong anytime? Here is some life saving tips for your finance during your investment tenure.

1. Set aside of 6 to 9 months of emergency funds for your monthly expenditure for rent, food, family necessities and others.
2. If you do not have medical insurance, you will need to keep some for your medical because you may need it when the time comes (God forbid)
3. Cut off your credit card debt; do not spend money you do not have especially when you are involved in a heavy commitment.
4. Managing your existing debt like your PTPTN debt, if you cannot do your duty to pay  RM50 on monthly basis, forget about owning property.
5. Do not consider touching your EPF funds also your retirement savings scheme.

Get yourself a mentor to be your guidance, mentors who have plentiful of experience, from financial tips, pitfalls to avoid and lessons. Do study on economics like Malaysia GDP Growth especially in the year of 1985, 1998 and 2009 (the economic crises), those were the best times to buy properties as during those times, many buyers or developers are willing to let go the property at lower price or throw in many discounts to entice property buyers. However, over the years, we have seen many greedy people have fallen into the trap of ‘get rich quick’ dream and fail to neglect the handsome returns from property investment that rely heavily on prices that continue to rise very quickly.

Do not be over optimistic and be vigilant with the country’s economic situation every now and then because when the slowdown starts, you will have to start your actions before crisis kicks in. Global economic uncertainties might increase the chances for the downturn to kick in and it may take some time for the economic to improve. It is likely that it will be a rough patch for consumers and property prices will not grow exponentially as it did few years ago when the property market is in good times. It is advisable for investors to be more realistic with capital appreciation growth and rental yields.


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