How Not To Get Fooled And Lose It All To The False Promises of Capital Gain?
How Not To Get Fooled And Lose It All To The False Promises of Capital Gain?
I am literately not able to understand how come many (if not majority) of the highly educated and intelligent people I either met or read about always get fooled by those brokers or agents who sell them off-plan properties with the promise of doubling, tripling, or even quadrupling their invested capital in 3 to 4 years once the development they are buying in is turned over.
Is it possible that those brokers or agents are smarter than those intelligent people? I don't believe so.
So, I made it my mission to discover how people very quite often fall to the trick of those magicians who claim to see the future.
I have interviewed more than 220 individuals who live in the US, UK, Singapore, Dubai, and Sydney ... trying to understand their motivations to buy properties off-plan and how they were convinced that they will make profit.
The answers to this short survey boiled down to 2 main reasons:Lack of financial literacyLaziness to analyse an investmentNow the thing is while few of those investors did indeed enjoy capital gains and thought they made a smart investment, the majority ended up with a property that is worth the same as the purchase price or most often less than the purchased price.
Many ended up losing their whole investment, since they did not have enough capital to pay upon handing over the property to them. Their original plan was to sell their investment at a higher price, pocket their gains, before the property would be handed over to them. It turns out that the crystal ball used by those magicians (the brokers and the agents) was not crystal at all ... it was a muddy vision.
How To Manage Risk When Investing In Rental Properties?
This diagram above illustrates the whole strategy of risk management when it comes to investing in rental properties. I have always followed this strategy in all my investments in many cities across Asia, Dubai, and Europe, and it never failed me.
In the case of investing in rental properties, Risk Management is when the prudent investor plans for the rental income as the worst-case scenario … and this often beats any interest that might be earned in stashing my money in a savings account.
However, when the opportunity for a jump in property prices presents itself due to market cycles, the investor can take advantage of it and sell or refinance for handsome profits.
The mistake most people make is that they only plan for capital gains when investing in real estate. They end up buying off-plan, counting on luck, parking their money, and increasing their risk.
Although this is a simple strategy, I still wonder why do people still fall for the same tricks!
The Employee Millionaire book and courses are aimed at increasing both the financial and investment literacy of employees, so that they can make wise and informed decisions on how to invest their hard-earned money for passive income and building generational wealth.
Learn More
I am literately not able to understand how come many (if not majority) of the highly educated and intelligent people I either met or read about always get fooled by those brokers or agents who sell them off-plan properties with the promise of doubling, tripling, or even quadrupling their invested capital in 3 to 4 years once the development they are buying in is turned over.
Is it possible that those brokers or agents are smarter than those intelligent people? I don't believe so.
So, I made it my mission to discover how people very quite often fall to the trick of those magicians who claim to see the future.
I have interviewed more than 220 individuals who live in the US, UK, Singapore, Dubai, and Sydney ... trying to understand their motivations to buy properties off-plan and how they were convinced that they will make profit.
The answers to this short survey boiled down to 2 main reasons:Lack of financial literacyLaziness to analyse an investmentNow the thing is while few of those investors did indeed enjoy capital gains and thought they made a smart investment, the majority ended up with a property that is worth the same as the purchase price or most often less than the purchased price.
Many ended up losing their whole investment, since they did not have enough capital to pay upon handing over the property to them. Their original plan was to sell their investment at a higher price, pocket their gains, before the property would be handed over to them. It turns out that the crystal ball used by those magicians (the brokers and the agents) was not crystal at all ... it was a muddy vision.
How To Manage Risk When Investing In Rental Properties?
This diagram above illustrates the whole strategy of risk management when it comes to investing in rental properties. I have always followed this strategy in all my investments in many cities across Asia, Dubai, and Europe, and it never failed me.
In the case of investing in rental properties, Risk Management is when the prudent investor plans for the rental income as the worst-case scenario … and this often beats any interest that might be earned in stashing my money in a savings account.
However, when the opportunity for a jump in property prices presents itself due to market cycles, the investor can take advantage of it and sell or refinance for handsome profits.
The mistake most people make is that they only plan for capital gains when investing in real estate. They end up buying off-plan, counting on luck, parking their money, and increasing their risk.
Although this is a simple strategy, I still wonder why do people still fall for the same tricks!
The Employee Millionaire book and courses are aimed at increasing both the financial and investment literacy of employees, so that they can make wise and informed decisions on how to invest their hard-earned money for passive income and building generational wealth.
Learn More
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