The Covid-19 Investment Plan

10 Workable Tips to Leverage Upon In The Current Pandemic

Mark Chua is an Executive Director in the financial services industry and a property enthusiast who prefers boring and mundane investments over sexy and exciting ones. The views expressed are entirely his own.

Gleaning his vast experience in property, industry veteran Mark Chua shares his 10 personal tips for property investment during this most trying of times.
1. The first three properties you buy within the first five years of your investment journey will make or break you.
2. Many people think they can get “rich” from positive cash flow properties. With due respect – that’s just a fantasy. Even if you get ten positive cash flow properties amounting to RM500 each – that works outto just RM5,000 in total (10 properties x RM 500 = RM5,000) which is not exactly an inspiring amount.
3. My advice is to focus on capital growth 3 properties, and balancing them against cash flow positive apartments.
4. Remember this Golden Rule – Cash flow keeps you in the game, but it is capital growth that will get you out of the rat race.
5. Covid-19 has taught us that low-density landed properties carry a higher capital appreciation premium due to the social distancing factor. Suddenly, a 3,000 sq ft behemoth condominium unit stacked up for 60 stories isn’t as attractive anymore.
6. Look out for motivated or distressed sellers in the subsale market, particularly during these challenging times when the automatic loan moratorium has ended. Not everyone residing in Damansara, Taman Tun Dr. Ismail, Taman Desa and Bandar Utama is automatically“bullet-proof ”. Somebody will be affected when the moratorium party stops.
7. Sacrifice is needed though. Chances are you’ll be bleeding negative cashflow when you buy a landed property that appeals to owner-occupiers. So, make sure your earned income is progressive enough to sustain this.
8. Don’t be seduced by stories that someone who earns approximately RM 2,000 per month can build a multi million-dollar property portfolio. These stories are very rare and few. From my experience, a vast majority of successful investors are extremely high-income earners.
9. Don’t believe me? Just think of the most successful investor you know and I can assure you that person has a high active income – either as a highly paid employee or business owner. That’s the hidden secret that no one talks about. The more you earn, the more you can invest and leverage upon efficiently.
10. In the final analysis, things must be done in the right sequence – grow your earned income substantially, and then build your asset base. Then finally, you can live off your cash machine – and not the other way around. Agree?
* Opinions expressed here are those of the contributor and are accurate at the time of print.

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