6 Successful Ways to Commit Suicide in Property Investment

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property investment

property investment

Property investment, for most people, is a way to earn revenues. For some it is a full time occupation, for others it is extra income. If you go into the jungle, you have to make preparations else the jungle will devour you. Only one beast in the property investment jungle can devour you – Yourself.

There are 6 unwritten rules of property investment. You would be well advised to follow them.

  1. Have An Investment Plan
  2. Seek A Mentor
  3. Buy Only Below Market Price
  4. Control Your Emotions
  5. Beware Of Investment Advice From Friends & Family
  6. Good Virtues

If you fail to pay heed to these rules, you are sure to commit Hara-Kiri, financial if not physical.

Property investment require a plan

We are preparing to descent into the jungle. Even the best guide will take some time out to prepare. Adventurers know the importance of a base camp where everything is organized, discussed and planned before execution. Well the investment plan is your base camp.

A plan is not made and then blindly adhered to. It is monitored, altered and adjusted constantly. The journey is in parts, from one milestone to the next.

  • Target: The start is obviously to set your target. It can be a single statement like “I want to earn 100,000”. The target tends to remain constant. It provides a focus.
  • Path: This part is a bit more complicated. You need to study, learn and decide how you will achieve your target. You have to keep adjusting the path with the target in sight.
  • Time: Time provides gains or losses. Everything you plan needs to have a time perspective to it. Take time to plan. It is your insurance and can account for profit rather than loss.
  • Property: Once you have decided on the property, you will invariably have to describe the parameters of the property. The purchase price, areas etc.
  • Indicators: Indicators are situations and events that make you act or need your attention. Create lots of indicators. They are your fail-safes.
  • Review: At regular intervals sit down and review your plan.

You may be lost with the ambiguity of the plan. It is normal.  This is reason you need an experienced mentor.

Seek a mentor to guide you on property investment venture

The best know that they are not at their best. A mentor helps in many ways.

  • Plan: A mentor will help you chalk out your plan and review it.
  • Real: A mentor will be able to tell you what is real and can be expected.
  • Pitfalls: You will not make beginner’s mistakes. Experience takes time. If you want to start with the re-inventing the wheel, you are welcome. It is smart to get a professional wheel instead.

A book or article can provide a lot of information. But only a mentor can provide personal guidance. After you have acquired a lot of basic, theoretical and practical knowledge, you need to tailor it.

Buy only below market price

This guidance is so important that it deserves its own section. In all your planning you cannot ignore one basic tenant. Only buy below market price.

You are a property investor. It is different than a property owner. Your aim is to achieve the target revenue. The property is only the means to reaching it. If you buy at market price, you are actually paying over the market price, since there are other costs that you need to add e.g. stamp duty.

In Malaysia, it is almost impossible to buy property below market price. In such cases, you have to be sure, that the property will appreciate as per your plan.

Control your emotions

There are many occasions where you will be tested. On all these occasions you need to remember that you have a target and a plan, you need to follow. A gambler feels the urge to play that game one more time. A property investor has urges of his own. The moment you feel, rather than think, that you need to act in a certain way. Stop.  Go away from the opportunity. Remember, if it is good for you, it will fit into your plan.

If you feel your plan was not good enough, take the time to edit the plan. Revisit the opportunity. Remember, there are always enough new opportunities. You just need to find them.

Beware of investment advice from friends & family

A lot of articles lobby that you should not take advice from friends or family. As a crude statement, it is true. Friends and family consist of a variety of people, with diverse backgrounds. Property investment is a specialized field where every decision results in revenue or loss. So as a rule, be wary of advice from friends and family.

By now, you are not an average property investor trying your luck on your property investment anymore. You at least have a plan in place. Any advice that you receive, should be evaluated against two scales.

  • Credibility: How credible is it? When your five year old son says that he is going to the moon, be a sport, but don’t start saving for a rocket. Most people giving advice will have a good intention. Remember that, after all they are friends and family.
  • Plan: In case you find the advice credible, check it against your plan and evaluate. Do not discard it because it comes from a family member. Some of your best tips may come from them.

Good virtues

A man is known by the company he keeps. Do not surround yourselves with bad apples. In property investment, it is imperative that you keep good company. Some virtues that you should adhere to:

  • Social: You will need to network with people in order to identify good property investment, buy and sell the properties. Be social and friendly at all times.
  • Honesty: There is nothing that can replace honesty. Having honest people to work with is very important. Be honest in return, it pays.
  • Legal: Do not do shady dealings in hopes of high profit. There are plenty of excellent legal opportunities out there.
  • Paperwork: The Germans have a saying “Spoken is good, written is better”. Adhere to this principle. Back up everything with paper. Stick to the written word.

It is very easy to commit hara-kiri in property investment. You will need to follow the 6 basic principles that will safely guide you to suitable returns. Make property investment a positive and rewarding experience for yourself, family and friends.

 

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New House for Sale – Important to Know the Developer

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If you are a seasoned property investor, there is no real effort in buying a new house. If you, however, happen to be a first time house buyer, or a budding investor, you need to read on. There are many aspects of buying new house for sale.

new house for sale

new house for sale

New houses are primarily built by property developers. All of us have gone to buy a computer notebook at one time or another. What is the one thing, everyone tells us to look out for? The one thing is the manufacturer of the notebook. The reason is quite straightforward. You need to be assured about the quality. In buying a new house for sale, it is no different. All developers are not equal.

Buying a house is not a small decision. It costs a lot of money. If you are taking out a loan, you will be paying the bank for years. And most of all, it will be your home. A place you will raise a family. Such responsibility needs careful action. You need to study and find out all you can about buying a new house for sale. In fact, it is so serious that it can cost your life.

New house for sale – Find the reputation of the developer

Popularity or the power to advertise does not define a developer. A wise man once said: “You are what you do”. This saying is particularly appropriate for the developer.

  • Experience: Every experience makes me a wiser person. The developers need a few years to complete a single project. You should trust an old hand at the trade. If the company is at least 10 years old, you can think about trusting them. This would translate into 5 projects minimum on new house for sale.
  • Residential: Commercial properties have different needs than residential properties. The experience, of the developer we seek, should be in the residential sector.
  • Size: Check out the size of the residential projects that the developer has undertaken till now. They should be respectable. The size of the earliest project should be the smallest. The size of the latest project should be the biggest. This is a quick measure of success.
  • Membership: The developer should be a permanent member of the main national builders association. It is alright if the developer has a membership of 100 other organizations, local and otherwise. What matters most is that he is a member of the main one. Most of the time all it takes is to go to the developer’s office and they will proudly provide you the list of memberships. You can also check on their website. The best place though is the website of the main national builders association. In Malaysia, it is RHEA – Real Estate And Housing Developers’ Association Malaysia. The website address is http://www.rehda.com

By now, we are convinced about the reputation of the developer on paper. Next step is to fill out our questionnaire.

Questionnaire on new house for sale

Here is a questionnaire that you would like to fill out at one of the latest completed projects of the builder. If the project is in another city take the day off, to drive there. It is crucial.

  • What is your opinion of the developer?
  • Are you happy you bought the house?
  • Are there things that the developer promised and did not deliver?
  • Were there any repair works done after you got the possession?
    If yes, were they carried out efficiently and promptly?
  • Was there ever a price hike, from the time you booked the property until the time you got it?
  • Were there any charges, that you felt, came out of nowhere?
  • Are you satisfied with the quality of the house?
  • Is the quality what you expected or have you made a compromise?
  • Can you tell me 5 things that you would do differently if you went back in time, regarding the purchase of the house?
  • What are the 5 best things you would say about the developer?
  • What are the 5 worst things you would say about the developer?
  • Do you know about any people who are extremely unhappy with the developer?
  • Would you recommend the developer to your friends and family?

Make sure you get this questionnaire filled by five people in the project of new house for sale. The easiest place to meet and greet the people is in a park. Tell them who you are. Tell them why you are asking the questions.

Inspection of the new house for sale

Observe the surroundings and the environment,when you are visiting the project. The quality of the things that you see is a measure of what you can expect. Visit the interiors of a new house for sale, if you get an opportunity. Observe and see if there are any obvious shortcomings.

Find out about any delays that took place.

  • Was the project finished on time?
    If not, were the delays bearable?
  • Was there any compensation for the delay?
  • How was the information flow?
    Did you get regular updates from the developer?

Banks

The projects of an accomplished developer are supported by relevant authorities. They are on the approved list of most banks. So when you go to the bank, expect them to know the project and the developer. If they are clueless, well maybe you need to buy a different house.

Banks also evaluate the property and can tell you what they think about the property. This is a significant evaluation of the property, that you are going to buy.  You probably have an account in a bank for a long time now. The bank sees you as their client. They will be glad to help you out with information about the developer and the project.

Conclusion

New house for sale are normally offered by developers. The developers range from small to large. You have to check out the developer of the house before you consider buying into the project. If you follow the recommendations above, you will not be in for nasty surprises.

A house is a home. It should not become a nightmare, financial or otherwise. Now you can go ahead and purchase with confidence.

 

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