Property investing is not without high risks

Source: me & my money, Feb 1, 2009, the sundaytimes

Mr William Wong, founder of property agency RealStar Premiier Property Consultant.
Entered real estate industry in 1995. One of ERA's top agents during 6 years with ERA. Left in 2001.

His bad investment:

Bought walk-in apartment in 1999 for $1.35M. Sold on en bloc in 2007 for $1.25M. Loss of $100K for holding it for 8 years. If we were to include interests payment on mortgage loan. I think it was a huge losses. If it was not sold in 2007, probably the losses were be further escalated.

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He commented average rental return is about 3% (Hmm... this is definitely worse than the dividend yield from holding a portfolio of REITs( commercial, office, industrial, and shipping)
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Let me examined his investment of this property at 1999.

The Asian Financial Crisis was a period of financial crisis that gripped much of Asia beginning in July 1997, and raised fears of a worldwide economic meltdown (financial contagion).

By 1999, however, analysts saw signs that the economies of Asia were beginning to recover.

So he probably got this property near the housing bottom or beginning of housing rise, and yet he suffered huge losses.

He was an not ordinary property investor, he was an industry's insider and top agent, and showed that bad investment can and always happen.

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Need very serious thinking....What if the element of bad luck hit, in any investment strategy, no matters who you are, George Soros, Warren Buffet, Bill Gross, etc there is this element called the Element of Bad Luck, it will, and certainly it will hit at least ONCE. These wise men also kena huge losses by bad investment.

So it is more likely to be a MAKE or BREAK strategy for those under-capitalized for just ONE BET. Got it right, you are on your way to an early retirement. Got it wrong (kena hit by the element of bad luck), you are likely to work as slave for a long, long time. So you jolly well make sure you got what it takes to get it right. So is there a MIDDLE ground? Think about it. Don't PRAY, PRAY!