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Sell 5 room flat and buy 2 condo units for better cash flow.

Friday, June 24, 2016

Recently, I shared on FB a conversation I had with a friend regarding a talk he went for:

Friend:
"I went for a talk on property investment recently. The person wants us to sign up for his course and he will teach us how to sell our HDB flat and invest in private properties for better returns. What do you think?"


AK:
"He will make money from the course. He will make money when you sell your flat. He will make money when you buy the private property. I guarantee that he will make money. Can he guarantee that you will make money?"

Seeing that, a reader who went for the course shared her experience and thoughts with me:




Y:
Refer to this post. I went for the course. Paid abt 3k. Learn all the concept. N it's workable. Just we mostly will not take any action to sell Hdb n go buy two privates. Because most of us will scare. Any step goes wrong then just gone case.

But they after the course also will provide service to help u achieve your dream la. Eg. Help u sell n buy n also get loan n tenant etc. All these cover in the fee. Abt $5k if I m not wrong.

Total 8k help u turn from one HDB to two privates. Think still worth it. What do u think?

 
AK:
Refer to the questions I asked my friends. My opinion has not changed.

 
Y:
Just share my experience only.
If not prepare to pay the almost 10k. Better don't go for the course. If hardworking enough. All info can get from Internet


AK:
Basically, the students bear all the risks. ;p
 
 
Y:
Ya
Speaker make the most. N easily buy properties for themselves


 
AK:
 that guru makes BIG $$$.


Y:
Frankly. If follow him. It is workable. But hor. Slowly our govt will close the doors one by one
Eg the most recent decoupling
Ppl got enough money n dare to take risk shd not hesitate
Risk here is. Risk of our market turning down. So. Property might not able to rent out easily


AK:
Interest rates rising. Oversupply problem. Rental falling. I think there will be many who are going to be caught swimming naked when the tide goes out...
 

In fact our govt has done good job
For the protection part
All the taxes or rule is not set for fun de
This is to avoid ppl too greedy n anyhow buy
Ppl just cannot explore too much. Except those real rich millionaire

 
AK:
Yes, problem is that the guru will not discriminate between the millionaire students and the not so rich students...

Those borderline cases will be the ones who suffer the most as they don't have holding power or the ability to take a big knock.
In the pursuit of greater wealth, we should not throw caution to the winds.
---------------------------------

Honestly, if we are after cash flow, why not rent out the spare bedrooms in our 5 room flat?

What? Bedrooms occupied by children? Then, how are we going to have enough space in a shoebox apartment?


You have seen a family of 4 living in a shoebox apartment after they sold their HDB flat and bought 2 private shoebox apartments?

You know, I believe you because I also know a family who did that. Mental.

Finally, when people tell us that we can sell our HDB flat and own 2 private shoebox apartment, remember that unless they are fully paid for, we don't have ownership. We might have control of the apartments but we don't own them.

(Remember, nobody cares more about our money than we do and don't ask barbers if we need a haircut.)


Related posts:
1. Should I sell my HDB flat to fund condo buy?
2. Buy that second property and pay the ABSD?
3. Disastrous investments in the property market.

11 comments:

Ray said...

Judging from the weak global economy and the latest Brexit, it is unlikely for interest rates to rise so soon.

AK71 said...

Hi Ray,

Indeed, it could be the case.

The longer cheap money sloshes around in the system, the worse the next crash is going to be. Crossing fingers.

Kyith said...

i cannot believe he paid 5k for that. of course there will be the endowment bias that it is money well spent.

Arthur Wang said...

"He will make money from the course. He will make money when you sell your flat. He will make money when you buy the private property. I guarantee that he will make money. Can he guarantee that you will make money?"

Totally agreed with what he says. That is why they are called The Guru.

AK71 said...

Hi Kyith,

I was taken aback too. That is quite a big chunk of change.

However, I am grateful for the sharing which, hopefully, will let others see more clearly.

AK71 said...

Hi Arthur,

I am glad you agree. I hope my friend takes my words to heart too.

Siew Mun said...

Yes, interest rate will remain the same or depress next 2 years. However supply of property outstrips demand coupled with low economy growth which means rental and yield will go lower. Own a diversified Reits portfolio instead of concentrating your risks in 1 or 2 properties. Reits will give you 5%-7% yield conservatively. Think for yourself don't let others do the thinking. Others will not have your interest at heart. They are keen to enrich themselves. You are responsible for yourself.

AK71 said...

Hi Siew Mun,

You have hit the nail on the head. We want to avoid concentration risk which is what small time real estate investors are exposed to.

Coreen said...

But .. but.. the GURU (if it's the same I met) said he is passionate in making lots of millionaires, he cares a lot you make lots of money like him.

Coreen said...

But .. but.. the GURU (if it is the same I met at the course preview) said he is passionate in making lots of millionaires, he cares a lot you make lots of money like him.

AK71 said...

Hi Coreen,

Sounds like the right thing to say. ;)

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