10 January 2013

Why I don't like to invest in Properties: Investment philosophy

Properties investment, cannot be denied, is capable of creating huge wealth. Needless to say, there are lots of successful stories around us. Yet, there are lots of unrevealed failure stories. Personally, I do not like to invest in properties because it does not suit my investment philosophy. My investment philosophy is quite simple: Only invest in a business that is capable of creating value that benefits to its owner (such as shareholders), to its users (such as consumers and customers), to the social (such as job opportunity and career development).

I must highlight that I am not interested in a "simply earning money" business. If a business simply will generate attractive profit without any contribution to its users and social, I double its sustainability in the future.
 
In our world, I strongly believe that only win-win or all-win situations can be sustained ever-lasting. If a company gains profit simply by selling low quality products with premium price, paying employers with lower than deserved, or doing illegal activities, will the customers keep buying these low quality products with premium price? will the employers stay in the company to earn lower than deserved salary? will the illegal activities continue with the tolerance of people?

Next, I am not denying the fact that lots of people gain lots of profit from properties investment. Of course, properties investment can create value to its owner, users, and social. For example, its owner will earn rental month-by-month; its users can find a place to stay in the area by paying affordable rental; Government receives tax from owners and people got shelter in new working place, every one is happily ever-after...

Wait.... I just project an idea case. In reality, it is opposite, except its greedy owner earns rental month-by-month. Most of the time, its users are forced to pay high "market rental price". Government may not receive tax because there are ways to offset the profit. People got expensive shelter, 25% of hard earned money is ended to have a shelter. (Note: There are good owners. But they are minority in this moment.)

And then, we can see the rich donates money to "help" the poor or the needy. Is it true? Think again. If the rich really want to help the needy, why don't they provide affordable rental for the needy? why don't they give reasonable salary to its employers? Why don't they pay more tax? Everyone know we cannot bring our wealth to the heaven or hell. But why so many people still so greed to take advantage of other.

Hmmm... actually, there is not right or wrong. This phenomenon may be caused by reward-punish system that is not covered in this post. That's all for today. More fascinating articles and sharing will be updated from time to time in Xaivier Blog. So, you are welcome to subscribe our feed, look at our sitemap or simply visit our Homepage for latest sharing.

Written by: Xaivier Chia

(P/S: The above sharing is solely based on personal insight. Please do not take it seriously. However, your valuable feedback are very welcome.)

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1 comment:

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