Monday 26 May 2014

Property investment, what exactly is it?

What comes to mind when you think about property investments?

To some, it will likely be buying a house or apartment and waiting for it to appreciate in value. To others, it would be renting out the property to generate income.

For me personally, I define property investment as a purchase of a property with the sole purpose of generating income AND profiting from the appreciation.

In my own definition, it excludes the properties purchased for self-residency, personal vacation homes (local or abroad), second residences or semi-stay/semi-rented homes. On top of that, it must both generate me cash flow and steadily appreciate over time, no two ways about that.

In my investment philosophy, flipping property, selling property options and buying homes under construction are considered speculation. The last example is likely to raise some eyebrows, but don’t get me wrong, I am not saying that you shouldn’t or you can’t make money by doing so, it’s simply not a practice that I encourage.

I have made successful investments in the past; and have made equally foolish decisions. I am still young (or at least consider myself to be!) and have many active years left.

I started this blog with the intention of sharing my views, strategies, lessons, errors and also mutual learning from your feedback.

Signing off,

ps. Throughout this blog, I will use the term “property” and “real estate” interchangeably.

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