Thank you, everyone. Just got back from vacation and did the inspection today.
hmc, I can understand your principle of diversification. In fact, real estate is one of my 3-legs diversification strategy. The other two are equity and start-up. I tried to allocate my after-tax savings accordingly. Unfortunately, I am mostly just inline with market return with my equity investment and I think US stock market is over-valued. So I don’t want to invest more at the current moment. And my startup idea never took off from the project stage. So I am stuck.
Again, I said I understand diversification in principle but in real life, no one can be truly diversified. For example, how diversified are you if you only buy properties in US? There are always costs associated with diversification and unlike equity market, diversification is very hard to do elsewhere. It is often said “Put all your eggs in the one basket and — WATCH THAT BASKET” because one may not have the energy to carry a true diversification strategy. Thinking you can diversify away risks is often an illusion.
Buffett says, “Diversification is protection against ignorance.” I would rather buy some places where I know the risks than getting myself into a total ignorance of the associated risks. My strategy may not be the best, but it’s the one that I feel more comfortable given my limited energy.
Part of me just wants to put this into bed so that I can focus my energy to see if I can take the startup idea into the next level. Just like four years ago, I want to buy the property so that I can spend more time studying investing. And once I had the first rental property, things can start manage on itself … at least I hope.
Like I said, I spent quite some time studying investing in the last few years. So if you want to debate the investment strategy, I am very happy to do so.
