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indomie
08-02-13, 10:18
Friday, 08 February 2013
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This month is special to me, I celebrate a big birthday. I won’t tell you how old I am, but it’s one of those birthdays with a zero in it.*

As I’ve been investing in property, and some would suggest rather successfully, since my early 20s. I’d like to share some of the most valuable investment lessons I’ve learnt over the last four decades.



1. Have a plan*

Strategic investors have a plan, know where they are heading and follow a proven system to take the emotion out of their decisions and give them more consistent results. They make educated investment decisions based on research and buy a property below its intrinsic value, in an area that has above average long-term capital growth and then add value to manufacture equity.


2. Take a long-term perspective*

The property market moves in cycles and in every decade there are a few years of flat or falling property prices. However, well-located real estate has increased in value by an average of over 8% per annum over the long term.*

Imagine if you could buy the house your parents bought at the price they paid 30 or 40 years ago; how many properties would you have bought then knowing what those properties would be worth today?


3. Treat your property investment like a business


The successful investors I know have grown a substantial asset base by treating their investments like a business. They do this by surrounding themselves with a great team of advisors, getting the right type of finance, setting up the correct ownership and asset protection structures and knowing how to legally use the taxation system to their advantage.*


4. There is not one property market*

While many people generalise about “the property market”, there are many sub-markets around Australia. Each state is at a different stage of its property cycle and within each state the markets are segmented by geography, price points and type of property.*

For example, the top end of the market will perform differently to the new homebuyers market or the investor segment or the median priced established property sector. And while at any time there are hundreds of thousands of properties for sale in Australia, most are not investment grade properties.


5. The crowd is usually wrong*

“Crowd psychology” influences people’s investment decisions, often to their detriment. Investors tend to be most optimistic near the peak of the cycle, at a time when they should be the most cautious and they’re the most pessimistic when all the doom and gloom is in the media near the bottom of the cycle, when there is the least downside.*



Market sentiment is a key driver of property cycles and one of the reasons why our markets overreact, overshooting the mark during booms and getting too depressed during slumps.* Remember that each property boom sets us up for the next downturn, just as each downturn sets the scene for the next upswing.


6. There will always be reasons not to invest*

Every year brings its own set of crises and lots of reasons not to invest. You can go back as far in history as you like and there won’t be a crisis-free year. Sure some years are worse than others, but there is always bad news and much of it is unexpected. Where investors get into trouble is that rather than focusing on their long-term goals, they see these crises as once in a generation events that will alter the course of history, when in reality they are just the normal path of history.


7. The devil is in the detail*

With so much market analysis available to us today, it’s easy to get caught up in the detail and scared into inaction. It’s better to keep an eye on the big picture and look at the property markets through a telescope and not a microscope.


8. Remember it’s about property


You’re in the business of property investment, yet at times investors forget the age-old rule of buying the best property they could afford in proven locations. Instead they get sidetracked by get-rich-quick schemes or glamorous finance or tax strategies and lose out.*

Fact is, property is not a get-rich-quick scheme. Don’t get carried away by the next hot spot or latest fad – make your investing boring, so that the rest of your life can be exciting. Warren Buffett was right when he said; “Wealth is the transfer of money from the impatient to the patient.”


9. Use debt as a tool


While many people worry about debt, smart investors use “good debt” and leverage to build their asset base. They then protect their assets by buying time though having a “rainy day” cashflow buffer set aside in a line of credit or offset account.



10. The two big drivers of property values




While in the short term our property markets will be driven by market sentiment, interest rates, supply and demand and microeconomic factors; in the long term, the value of well-located properties will rise, propelled by the twin factors that have always driven long-term property prices – population growth and the wealth of the nation. Both of which will increase substantially over the next few decades.*

Learn from these lessons and the rollercoaster ride of your property investment career may not be as dramatic. Remember, both fear and greed will send you down the wrong path, but sense and sensibility will keep you heading in the right direction – toward real estate riches.

Michael Yardney is a director of*Metropole Property Strategists, which creates wealth for clients through independent, unbiased property advice and advocacy. He is best-selling author, one of Australia's leading experts in wealth creation through property and writes the*Property Update blog. Subscribe today and you'll receive a free video training - The Golden Rules of Property Investment.

Arcachon
08-02-13, 13:16
Happy 60 's birthday.

Still remember when my grandmother reach her 60's birthday, we have a big celebration. Time fly when you stop thinking about Time.

indomie
08-02-13, 13:23
Happy 60 's birthday.

Still remember when my grandmother reach her 60's birthday, we have a big celebration. Time fly when you stop thinking about Time.
For goodness sake.... I am not the writer and certainly not having 60th birthday. Bu I wish to still be around when the time come.

RSG
08-02-13, 13:50
For goodness sake.... I am not the writer and certainly not having 60th birthday. Bu I wish to still be around when the time come.

HAPPY BIRTHDAY Indomie. Your postings are interesting to read and I have benefitted much from them. Pls keep posting. :D

indomie
08-02-13, 13:59
HAPPY BIRTHDAY Indomie. Your postings are interesting to read and I have benefitted much from them. Pls keep posting. :D
I don't accept anymore bday wishes... But I take donation.

propertychap
08-02-13, 14:28
Would you invest in Malaysia like Iskandar and KL now?

TKT
08-02-13, 14:52
Would you invest in Malaysia like Iskandar and KL now?

The next BIG WAVE will be MEDINI Iskandar....

Wait for a big announcement before end Feb... game changer.


:47:

indomie
08-02-13, 14:58
Would you invest in Malaysia like Iskandar and KL now?
At this point, any part in the world where there is a huge concentration of singaporeans.... You should expect a significant growth. Its the demand spillover effect.

propertychap
08-02-13, 15:23
Medini will be CBD in NUSAJAYA but the land is lease which means cannot be renewed.
There is a media village upcoming.
Is it good to buy projects near the second link CIQ?

newbie11
08-02-13, 18:07
I think cbd is too big of a label. At best, Call it the business district..

http://www.iskandar.asia/insight/exclusive-interview/70-exclusive-interview-with-mr-keith-martin.html

fiat500
08-02-13, 19:56
The next BIG WAVE will be MEDINI Iskandar....

Wait for a big announcement before end Feb... game changer.


:47:
Johor Bahru is still petty crime infested.Singapore registered cars are prime targets,ultimately it's still not a very safe place to live in.
Furthermore if u are buying for rental income, it will not be that easy as not many expats live in johor bahru.

hyenergix
08-02-13, 21:47
Always b careful. I foresee more police presence in JB . Things shd b better in 5 years time.

fiat500
08-02-13, 22:28
Always b careful. I foresee more police presence in JB . Things shd b better in 5 years time.
Problem is the police all switched off there! LOL
That is their work attitude..
This issue won't be easily solved many years the road..

Arcachon
09-02-13, 22:36
Can Johor be the next Spain.

http://www.youtube.com/watch?v=m0Tg0IiCPhA

teddybear
09-02-13, 22:41
Worst still, Malaysia's police kill and burn! Saw that news on newspapers about the mongolian girl being killed and burned by the Malaysia's police to cover up everything? Wow! :scared-1:



Problem is the police all switched off there! LOL
That is their work attitude..
This issue won't be easily solved many years the road..

hyenergix
10-02-13, 06:53
Can Johor be the next Spain.

http://www.youtube.com/watch?v=m0Tg0IiCPhA

All purchases in JB for foreigners have to go through a tedious state consent from e govt. Spain developers din even have e govt appoval to build in e first place. But cases of small developers selling units without govt approval exist in Malaysia, even more recently in Singapore. Always go for more reputable developers, get international freehold unit n pay ur levy for state consent.

dare2
13-02-13, 04:27
Johor Bahru is still petty crime infested.Singapore registered cars are prime targets,ultimately it's still not a very safe place to live in.
Furthermore if u are buying for rental income, it will not be that easy as not many expats live in johor bahru.
...well at least the law there did not punish those who fight with the robber (the retired Police chief who shot the robber), here they punished an old man who beat up a hooligan who bashed up his son-in-law.

.....if you check out sunset way landed residential, there are signs asking for infor about a spate of break-ins, just that there's not much news about breaks-ins in sg, neither would owners want to make so much noise for fear of bad publicity.

Overall, the police handled more cases of outrage of modesty, 1,414 last year, .....10 % of this figure were ladies who got molested daily on public transport....how many unreported?

Yes Sg is Fine....


.....fatal accidents: There were 7,168 fatal and injury accidents in 2012,

..... Commander of Traffic Police, Assistant Commissioner of Police, Cheang Keng Keong said: “While we will die from old age or may succumb to illnesses, we should not be dying on the roads due to traffic accidents. There is a need for road users to act responsibly and adhere to traffic rules.

hopeful
13-02-13, 09:07
...well at least the law there did not punish those who fight with the robber (the retired Police chief who shot the robber), here they punished an old man who beat up a hooligan who bashed up his son-in-law.
.....

is the old man who beat up the hooligan a retired police chief?
if yes, then the law also would not punish him.