I've made an offer - investment rule number one "buy when no one else is2

neverdespairgirl

Conrad wrote: »

£159k offered on a house that was worth £215 - £240k last summer.
In the meantime the rent is £9600 pa.

Isn't that only about a 6% gross yield?

HankMcSpank

Two points for the OP.....

for such a self assured thread title, you seem like you have doubts in the body of the post (or certainlty trying to convince/justify yourself).

secondly...I think you need to throw your rulebook away...it's incorrect.

My first rule of investing is "don't try & catch a falling knife".

This is *waaaay* too early to be buying - you don't just get a 14 month blip down following a decade long party!

keeprenting

investment rule number one "buy when no one else is"

If that actually is an "investment rule" (and I don't believe that it is) then it is an extremely bad one. It takes no account of the possibility that everyone else could be right to avoid certain "investments" like the plague. Nobody was buying dotcom shares after the dotcom bubble exploded - do you think that was a good time to buy these shares?

justpurchased

mewbie wrote: »

What is rule number two? Sell when no one else is selling?

I would say yes. If you go to market with a product no one is selling (new product etc.) You will make a higher margin. It lowers the more people sell it.

So in house terms. 1 house for sales on a street is more likely to achieve nearer asking price than competing against three on the same road.

Conrad

lynzpower wrote: »

Ive been following your investments conrad and generally they seem to be well thought out ( possibly aside from that Algeria borders one)

I thought you were looking at Colchester, out of interest what was the reason you discounted that?

Can I ask where abouts this house is, I have been very interested in what youve seen, and I think you find better properties at better prices than I do

I have not discounted the Colchester one - but there are many options to consider.
I'd rather not say where the other property is - small town and all that.

I've no insights on identifying cheap property. I perhaps have an advantage in terms of the fact I deal with such matters because of my business, so I am exposed to quite a lot of property information.
Im not rushing into anything.

As contributers have said, there are reasons to support the theory that prices will not recover quickly.

As for the Morocco one - it's looking quite good albeit the building work is behind schedule and there have been various hiccups along the road.

EDIT............ Ooops as I was about to submitt this reply, the EA has called - the seller has accepted the original offer! Now I've got to pursuade my wife - sho told me no more property dealing! I didn't think the guy would sell for this - I was only testing the water - now Ive got an expectant local EA on my case

amcluesent

There is a case to be made for and against contrarian investment, just as with momentum investing (aka follow the herd). The challenge with housing is the illiquid market and transaction friction. IMHO, you're better living in a house and speculating using spread-bets on the national house price index.