I was speaking to a young friend during the weekend. She had just started working for a few years. She was rejected recently when she applied for a housing loan. It was her first ever home purchase. I asked why and she sheepishly replied that the repayment per month is a little hoo high. I asked why not buy something more affordable first. She said it’s good to buy something which may appreciate much faster instead of waiting for many years. “Buy something which appreciates much faster.” If this is true, why are there so many people who are still not yet rich and are still working and complaining about their bosses everyday?
I told her honestly. Buy within affordability. There is no such thing as fast or expressway to huge profits. She told me that she was following a prominent property speaker who told her to try and buy properties for no-downpayment. I shared with her that if everyone in the whole market are all buying with no-downpayment, what would happen to the property market? She answered that everyone would own a property. I told her, everyone would own a useless property since the market would have collapsed when the majority are buying without sufficient downpayment because the truth is, they could NOT afford it yet! Yes, that mortgage crisis which started in the largest economy in 2008 may this time happen in Malaysia.
Let me share a better tip instead. Instead of buying without any downpayment, why not borrow lots of money, drop by a casino and bet on the “BIG” or “SMALL” instead? Within seconds, if your choice is right, you have just doubled your money just like that. If you think this is wrong, then why would you think that you are entitled to buying something which you could not afford so that you can gain profits that you do not qualify in the first place? Yes, I do not like when people are buying thing which they just couldn’t afford yet. Stop telling me that the more they wait, the more expensive the properties would be. I seriously do not think you browsed any property listings lately. The only reason nothing affordable could be found was simply because they were looking at all the expensive and popular areas! Well, after staying in such an ‘unwanted’ area for the past 1.5 years, I am still doing well. Sorry yeah, I do not buy any of these ‘get rich quick’ reasons. Of course I have no powers to stop anyone from getting rich quickly. So, I will just wish you all the best and hopeful for the best for the more honest and real investors out there. Happy buying.
written on 13 Dec 2015
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