房地產(chǎn)投資理念

1、Module 4Investment concepts6/12/2022OverviewMarket SegmentationWhy put money in property marketNature of investment passive incomeLeverageFeature of worthy investmentProperty, shares, or bonds?Property vs stockWealth polarization and property investmentMore advantages of property investment 6/12/202

2、2Market SegmentationOrdinary employeesBusiness people Self employed InvestorsFour groups6/12/2022Why put money in property marketNature of investment passive incomeDefinition - an income received on a regular basis, with little effort required to maintain itMajor sourcesRoyalties from publications o

3、r intellectual properties Property and rental income (accessible to four groups)Dividend from securities Pensions6/12/2022u 70% senior citizens rely on less than $300/week income u 80% receive state provided pension only u Only one self living propertyHoweveru More demanding rules on pension eligibi

4、lity u Strict income testu Age increased from 65 to 706/12/2022Why put money in property marketLeverageDefinition Techniques multiplying gains and lossesBuying more of an asset by using borrowed funds, in belief of appreciation will go beyond the borrowing costHigh risk level with wrong investment A

5、n investor who buys a stock on 50% margin will lose 40% of his money if the stock declines by 20%6/12/2022Why put money in property marketFeatures of worthy investmentsWorthy investmentAppreciation potentialStable incomeTax benefitsLow riskSelf controlling6/12/2022Why put money in property marketPro

6、perty, shares, or bonds?6/12/2022Why put money in property marketProperty vs StockPropertyStockLower volatility in price (recall the picture in first module)Higher volatility in priceLower level of uncertaintyHigher level of uncertainty all companies are possible to bankruptLower perceived risk by l

7、oan providersHigher perceived risk by loan providersSelf controlling, more management choices (includingto be added)Limited self controlling, less management choicesLeverage power (How?)Hard to use leverage power, often extremely risky or strictly restricted6/12/2022Wealth polarization and property

8、investmentPeople with multiple propertiesPeople without any propertyPossess more than three propertiesNo property investment due to various reasonsInvestment portfolio double in 710 yearsMoney in bank depreciates gradually due to inflationInterest rate rises increase rent; interest rate falls increa

9、se selling priceRent increased with rising interest rate, no benefits enjoyed otherwiseThe more passive income, the earlier happy retirement life commencesNo passive income, no wealth freedom, no early retirementMake use of leverage power actively Leveraged by others6/12/2022More advantages of property investmentHigh quality life guaranteeSpreading investment to reduce riskTax benefits (installment acts