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Monday, July 14, 2008

Landlords and Property Investors Should Look to Set the Fashion and not Follow the Fashion

Property as a pension is so last season.

The fickle world of investment fashion has decided (with good reason) that property is not a guarantee to future security.

This article in the Financial Times tells of a 73 percent drop this year in the number of people intending to use property to fund all of their retirement.

This is an incredible drop in numbers from 3.2 million investors last year to just 878,000 this year.

Thats what you call a quick fashion change.

These figures reinforce the nature of the majority of investors who charge after past performance as a indicator of potential future investment returns.

Unfortunately as with fashion, as soon as everyone is saying something is cool and groovy , by definition it is already out of fashion and definateley not cool and groovy, that doesn't stop the 'non-thinkers' running in and buying into it. Ouch! Bad investment decision.

This swing the other way is a result of this same group momentum, the media tells the non-thinkers - this is not 'cool and groovy' and off they all rush again.

Great - good times to buy property again coming soon.

But not quite yet. Fashion is all about timing.

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