Monthly archive - February 2015

102 Pearls of Wisdom to build SUSTAINABLE Property Wealth

Posted on Feb 28, 2015 in Articles, Singapore Property Investment by 1 Comment

Back to School

  1. A guy told me one time that there are two types of people in the world:  those that spend all their time trying to make their fortunes but lose them eventually, and those that once they make their fortunes, spend all their time trying to guard them.  Who do you prefer to be? Everyone says they want to be the latter obviously, but most ends up the former irrespectively.
  2. Property is a poor hedge against inflation when you buy at inflated, future prices.
  3. Singapore’s population growth has NO direct correlation whatsoever with property prices.
  4. Spend time learning the math. The math will keep you from buying a bad deal, which is more important than buying a good one!
  5. The Chinese proverb ‘’. Success is when the horses come. Success goes only to those who dare and act, it seldom goes to the timid. The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.
  6. The people who say ‘All I want is to buy & sell my property and be a millionaire’ are a bit like blokes who say ‘All I want is to go out and get laid tonight’. They normally go home on their own.
  7. Owning property with little or no down payment can sound quite wonderful, but there are major pitfalls to this strategy. – And plenty of marketing BS too!
  8. The prize “location, location, location” properties have corresponding negative cash flows that may negate any true increase in wealth from one’s long term appreciation in value.
  9. The Cash Flow Positive Mantra means absolutely nothing IF – A whole $200 a month net cash flow on a million dollar property purchase is all you get for your troubles and efforts.
  10. Own properties that pay a fair Cash-on-Cash Return. When you buy property you are taking money out of your liquid financial assets into a very illiquid asset – property. You were earning a rate of return on your financial assets, such as 4 percent or 6 percent, and you should strive to earn a fair cash-on-cash rate of return on your property.
  11. Owning a property is less risky than owning stocks and shares – IF done properly.
  12. The investment is only as good as the skills of the investor.
  13. “Return = Skill + Work.” The more skills and work you put into your property investment, the higher your return should be.
  14. It is important to understand who is going to be renting from you before buying a property. If you cannot answer that question, then you haven’t done enough (research). If you need to spend hours in front of the entrance of an apartment just to see what kind of occupants dwell in the building, you do just that.
  15. There’s no such thing as a bad property (investment). Only a bad investor. So never blame everyone else but yourself for failure. (scams included)
  16. One man’s meat is another man’s poison. What is good property for one person, may be bad for another.
  17. Know What Kind of Investor You Are – Investor or Speculator. The difference is simple: an investor looks at a property as part of a business and he as the owner of the business for the long term, while the speculator see property as stocks they buy now in the hope that someone will pay more for it down the road.
  18. If you’re not prepared to manage tenants, stay off property investing. Buy mutual funds instead.
  19. A Market Correction is an Opportunity for the Patient, Long-Term Investor. Long-term investors should welcome market corrections as an opportunity to purchase good properties at attractive prices.
  20. Property investing is NOT about how beautiful the property is, but rather how much the investor’s return on investment. Or as one property investor once told me, “Only women are beautiful. What are the numbers?”
  21. Home buyers are looking for attractive neighbourhoods, good schools, ample amount of amenities, connectivity and nearby MRT stations. Experienced property investorsNEVER buy investment property solely based upon these things other than how they might influence rents and occupancy.
  22. Novice investors need to stay within their abilities until they acquire some experience. Avoid new sales, off-the-plans, flipping, ‘exotic’, commercial & industrial properties.
  23. If you truly want to achieve long-term success as a property investor, take the time to build a strong foundation of knowledge and skills which include analysing investment deals, understanding property values, financial statements, sales, business and people’s skills.
  24. Treat your property as a business. Learn how to manage, market, evaluate and lease.  Learn to manage and work with good vendors to support your business.
  25. If You Can Do It Yourself, Then Do It! – I’ve heard too many people giving advice to investors that they should be hands off (subletting for example). I enjoying managing properties myself and my ROI is exponentially higher when I am at the property doing as much of the work as I can, because I’m good at it and I enjoy it. If you have the skills, don’t be afraid to use them just because other investors do not.
  26. The popular saying in property investment is that you make your money when you cut your deal to buy the property, not when you sell it. That’s 100% true.
  27. Landlords grow rich in their sleep without working or risking.
  28. Price is what you pay. Value is what you get. Value pays you, Price steals from you.
  29. Investing in New Sales - The chief value of propaganda lies in the fact that one lives in a world in which is overestimated.
  30. A home can be a nightmare if the buyer’s eyes are bigger than his wallet and if a salesperson facilitates his fantasy.
  31. Everyone says buying your first property (home) makes you feel like an adult. What no one mentions is that selling it for profits turns you right back into a child.
  32. Property exhibitions – The expensive marketing, venue and sales commissions cost more than the actual property.
  33. Most property ‘experts’ are pure BS fill with hype and overall lack of investing intelligence.
  34. Free property seminars & talks – Mostly just empty your wallets after the ‘Free’.
  35. All big, expensive property seminar programs are time-wasters – They sell ‘dreams’, not wealth.
  36. Wealth and property ‘gurus’ are worshippers of money, therefore they’re narcissistic.
  37. Learn to spot property scammers. Protect your capital first, returns come later!
  38. There aren’t any secrets to property investing; just like anything else, given time, hard work and maybe a little luck, it becomes lucrative.
  39. Smart investors never buy properties from seminars and exhibitions.
  40. Not every property books, talks and seminars have your best interests at heart. Nobody gives a damn about your success more than yourself. …. but everybody gives a damn about your money, that’s for sure!
  41. In investing, what is comfortable is rarely profitable.
  42. Remember: It’s your property! Watch your money, leases, tenants, expenses, and everything else carefully!
  43. Remember: You’ll run into problems with your rental property! (Tenants, Neighbours, Repairs, etc.) – Accept it or don’t invest.
  44. One of the biggest misconceptions that people have when investing overseas is that they assume all overseas property markets are the same as Singapore. It’s not.
  45. High Yielding Overseas Properties – Such properties are rarely smart investments for foreign buyers. There is a reason why the yield is so high. After all, if the property was raking in a ton of cash for the owner, why sell it? They come with many underground risks and poor returns from mismanagement.
  46. Some overseas properties just require way too much time, management and specific know-hows to make them smart investments. Examples include vacation rentals, low quality properties, hotels, student accommodations, etc.
  47. There is NO such thing as a ‘Rental Guarantee’ property. You’re simply paying more than what the property is worth so you can receive the ‘Guarantee’.
  48. Rule #1 for successful overseas property purchase – The locals can afford to buy or rent the property.
  49. Rule #2…  The locals must want to buy or rent the property.
  50. Rule #3… Build strong strategic partnerships with experienced local investors who have deep underground knowledge and expertise of the local terrain.
  51. Rule #4… Always FOLLOW Rule 1, 2 & 3!
  52. Choose your tenants wisely. They make or break you as landlord.
  53. “Property investing should be more like watching paint dry or watching grass grow. If you want excitement, take $1,000 and go to Resorts World.” – A twisted version of Paul Samuelson’s.
  54. Appreciation - The bottom line is that if the numbers work and it cash flow, it’s not that important how much the property is worth at the present time.
  55. While property prices are volatile, rents are stable and follow CPI trends.
  56. Capital Gains – It’s always a Zero Sum Game. Sell high, Buy high too. Where’s the logic?
  57. The best way to be as successful as possible as a property investor is if you find your true niche.
  58. Novice investors need to narrow their focus – Residential, Commercial or Industrial? Pick ONE and understand everything you can about it… and I mean everything!
  59. When people ask me how to get started in property investing with no money, I suggest they go to the library and read a half dozen or so books on basic investing as a start. Then read books on people’s skills, real estate, sales, business, economy, etc. They rarely follow this advice.
  60. If you want to get rich fast through property, don’t try. Fast and easy money is for suckers.
  61. If you’re about to make the biggest purchase of your lives, you need to understand the basic concepts of real estate. In fact, I hold you to a higher standard: You need to be at least intermediate, if not expert, for this expenditure can cost a million dollars of life-paying debts.
  62. I kind of hate to be the voice of doom, but I just can’t see how prices can’t go down by XX%. I think people have actually forgotten that property prices have gone done that much in the past. There’s this feeling that they just won’t fall dramatically, but, of course, that’s not true.
  63. Property investing might be right for you. It might not. But do not make the largest decision of your life because it’s something you “should” do.
  64. Famous Prussian General Carl von Clausewitz once said, “The greatest enemy of a good plan is the dream of a perfect plan.” Avoid analysis paralysis in your actions, plans and goals. Just do it!
  65. Bulls make money, bears make money, and pigs get slaughtered. Guess who’re the pigs?
  66. Expect corrections; don’t be afraid of them. Unless you’re a pig.
  67. Holding Cash is for Winners – It’s never wrong when you can’t find properties that truly makes sense for you.
  68. No Woulda, Shoulda, Couldas Know the maximum price (walk-away price) you’re willingly to pay before negotiations!
  69. Hope is not part of the equation – Buy, hope and pray is for pigs as in “I hope to profit when property T.O.P.”
  70. Be able to explain your selection of property to someone else. Always make sure you can articulate your reasoning to someone else and if you can’t, you shouldn’t be buying.
  71. Property developers form price cartels. Evaluating a new sale by comparing Per Square Foot prices can be deceiving and speculative.
  72. Property developers are in the business of WHOLESALE, and not in the business of long term property investment – They make it a business to SELL real estate piecemeal to masses to make money!
  73. “Investment is most intelligent when it is most business-like.”Benjamin Graham, The Intelligent Investor. Same with property.
  74. If you focus on the prospective price change of a property, you are speculating. Period.
  75. Learn Your Market Numbers: Know how much properties are actually worth and how much you can pay. That knowledge produces confidence; confidence + accurate numbers = a strong offer; strong offers + repetition = deal flow and more confidence.
  76. Think only of what the properties would produce and cared not at all about their valuations. “Games are won by players who focus on the playing field — not by those whose eyes are glued to the scoreboard.’- Warren Buffet
  77. Forming macro opinions or listening to the macro or market predictions of others is a waste of time.
  78. It’s vital that we recognize the perimeter of our ‘circle of competence’ and stay well inside of it.
  79. Most unsophisticated investors have not made the study of business prospects a priority in their lives. If wise, they will conclude that they do not know enough about commercial and industrial businesses to invest in those property segments.
  80. The unsophisticated investor who is realistic about his shortcomings is likely to obtain better long-term results than the knowledgeable professional (‘experts’) who is blind to even a single weakness.
  81. When I’m evaluating property VALUE, there are two value rules:
    1. Don’t pay too much for the earth. – Pigs overpay on the notion of limited land, increasing population and marketing propaganda.
    2. Don’t pay too much for the business. – If you look at the “Price-to-earnings” ratio of your property, you can learn about its true “intrinsic” value – a.k.a. rent.
  82. Own, fix and profit from old apartments/houses, instead of new sales.
  83. AVOID Mid to High-End properties – You’re not going to get rich, you’re also not going to get poor at the same time.
  84. Novice Investors – Get started FIRST with mass market residential property – It’s easier to understand, purchase and manage than other types of property. If you’re a homeowner, you’ve already got experience here. Start close to home, so you can stay on top of things.
  85. “If you want unconventional success, you can’t be guided by conventional wisdom”. – think-grow-rich
  86. Be specifically-clear about your objectives when you invest in property. First ask “Why”, not “How”
  87. It’s far more important to survive the downturns and have stability of capital than it is to chase after max-out returns.
  88. Time in market, not timing the market.
  89. The greatest asset you can grow that will pay the most dividends for your investment future is your own (street) education. The learning never stops.
  90. Save for 10 years of hardship, invest for a lifetime of prosperity.
  91. Why buy a new car when you can own a property?
  92. Due to a plateauing Singapore property market, profiting from capital gains is harder going forward, and Cash Flow is taking over as the reigning king of property.
  93. If you get your ROI RIGHT, all other parameters, including price & location would have fallen into place.
  94. ROI – Different people use different words, and use the same word to mean different thing. Always clarify in your mind what is being meant, without preconceptions.
  95. Time Value of Money – Cash flows are worth MORE today than they are tomorrow. That’s a reason why new sales gives poorer returns than re-sales.
  96. Evaluate how the property’s yield will meet your ROI objectives. Square footage prices of existing new launches measure current market. ROI measures your investment objectives. On a level of descending importance from A-Z, if A is ‘ROI meets objectives’, Y is ‘comparing dollars per square foot’ on your criteria list of importance.
  97. Communication, communication, communication… instead of location, location, location… I can’t stress it enough!” You want to work with people who will, through good communication and integrity, build your trust and develop a prosperous and long-term relationship with you.
  98. “We don’t predict the future, but we do know that the next five years will not look like the last five years. That just doesn’t happen. Markets change. And our results over the next five will not replicate the last five. They never do.” – Gerald Tay
  99. Property is the best investment on earth, however, when the music stops playing, which happens occasionally, don’t be the one left without a chair.
  100. Being rich is having money; being wealthy is having time – You can get more money, but you cannot get more time. Eat, drink and sleep on this important wealth philosophy.
  101. The new way to get WEALTHY – Slowly. Durable things rarely are created overnight. If you’re a millionaire by the time you’re 30, but blow it all by age 40, you’ve gained nothing.
  102. My money, I should add, is where my mouth is: These timeless pearls of wisdom are essentially identical to my actions. Sustainable investments give sustainable wealth which allows me to sleep well every night. Many people worry too much about material things and wealth. They believe property can give them that only to lose it eventually.  I prefer to live a meaningful, useful life than one that is measured purely by money.

Mold your mind to see what your eyes cannot – How to Discover Gem Properties on the Streets!

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To your investment success,

Gerald Tay

Get-Rich Wealth Seminars are Time-Wasters – Dirty Underground Secrets Exposed! (Part 2)

Posted on Feb 22, 2015 in Articles, Singapore Property Investment by 1 Comment

Property busted
Be sure to read Part 1 of this Post! “Get-Rich Wealth Seminars are Time-Wasters – Stay Out if you can!

As you already know crei-academy.com is not exactly a conventional property educational web-site. We often post information denying the typical mainstream get-rich-in-property wealth claims that are nothing more than tricks scamming the ‘noobs’.

One of those tricks is called: Get-Rich Wealth Seminars by ‘gurus’ with bogus claims of success and financial freedom. It’s all Hollywood blubber.

Get-Rich Wealth Seminars are Time-Wasters – Stay Out if You Can! (Part 1)

Posted on Feb 14, 2015 in Articles, Singapore Property Investment by 1 Comment

 

There are real people who share real education with real experiences.

I want to emphasize this post is about giving credit and due reputation to the wealth education seminar industry. There are real people who share real education with real experiences. And many learners benefitted from their sincere sharing’s.

BUT…. There’re those who profit from lies, and continue to. And they give a bad vibe to the entire industry and to the real educators!

“Getting Rich Fast” in Property – Myth or Reality?

Posted on Feb 8, 2015 in Articles by 0 Comments

 

People want to get things fast. The sooner, the better. There is no time to wait.

Give it to me yesterday, please.

As expected, getting rich or building wealth does not make an exception. There are a lot of programs that promise fast results, if not instant. They are oriented towards the subconscious mind of the individual which has been programmed by the machine to want everything as quickly as possible.

Ironically, this is also why we never accomplish anything. We want things now so bad that we don’t stick with the plan long enough to make a difference. Even when you’re on the right track you have to wait for the train to arrive where you’re headed.