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Best property investment plan: Buy low, Sell high.

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Buy Low, Sell High concept

Let me laugh first. Haha. I think everyone knows that the best investment strategy (whether property, stocks or even unit trust) is always to buy low and sell high. Even for developers, they will be looking to buy land at the lowest price possible and constructing their ‘masterpiece’ with a manageable cost and then pricing it as high as the market could accept, right? Anyone with a better strategy please share with all. Sorry yeah, those Get-Rich-Quick type of “investment” will not be published.

Timing Issue

The only problem is this. We want this ‘buy low and sell high’ concept to happen almost immediately. For stocks, many are looking at seconds if not minutes or perhaps hours. For property, it’s buying now and selling next year. Well, here’s something I learnt after investing in stocks and properties for the last 15 years. Investment is long term. Else, it’s called speculating. No comments on which is right and wrong, just naming it correctly, that’s all. On a yearly basis, there will be fluctuations. On a longer term basis, the returns are usually above the inflation rate which meant that perhaps investments are all meant to hedge against inflation; staying ahead a little so that the value of our money remains the same over time.

WHY focus

Instead of asking the usual What to buy or where to buy (for property usually), we should look at WHY instead. My personal reason for unit trust is to buy and forget and then be pleasantly surprised many years later. For example, I did not even know that after many years of buying unit trust from Public Mutual, I was upgraded to Public Mutual Gold member. As for returns, it’s not that awesome compared to my property investments. However, let’s say it’s pretty stable after such a long time.

If it’s property, instead of asking where, how about asking WHY are we buying that property? For own stay? Then, perhaps buying as big as possible in an emerging township will be better than putting all our savings into an expensive mature neighbourhood. For continuous rental income? Then, perhaps buying into a development with an education theme will be better because education is after all an evergreen industry and the requirements for tertiary education will only increase and not decrease.

Conclusion

The focus on Buy Low and Sell High is correct. The journey to reach the final destination is however going to be very different depending on whom we speak to. By the way, even auction properties could be a great way to start because these days, there are many more below-market-value properties in auctions. Here’s one article I wrote for iProperty.com.my on the attractiveness of auction properties. ‘5 reasons to consider auction properties in 2019’ Happy buying the lowest and selling the highest yeah.

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<Featured Image is courtesy of Stock Photos from Cheryl Casey >

Article written and edited by Charles. News article summarised by Dina Batrisyia.

Next suggested article: If we did not sell, we did not lose yet.

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