http://www.youtube.com/watch?v=nn-bd20zoU4
Listen to this interview with Robert Kiyosaki. "Capital Gains is a Ponzi Scheme." "It's a greater fool theory". When you buy a house in the hope that someone else will buy from you at a higher price, it's called a Ponzi Scheme. You're hoping that someone comes to take it off you at a much higher price.
Back in the Credit Crisis, the ones who got hit were the ones who went for pure capital gains without rental income. I can see it coming in the next three years. When interest rates rise, those who bought houses / shops at 2.5% yield will get hammered. Those who bought pricey houses at zero yields in Iskandar will get hammered when interest rates rise to 6 - 7%.
I am extremely cautious in everything I do. I cannot afford to lose what I've gained. Even for stocks, I go for high dividend plays. For properties, I definitely go for a good balance of yield and capital gains. If a house produces negative cashflow against my mortgage, I would avoid it. Cashflow is my defence in case I am stuck with it for a long time.
I hope readers take heed.
