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keep equity of 50k in a property, the opportunity cost is what heshe could
alternatively have invested this money in and the resultant value.
Now
again this will depend on your specific strategy ? and many people are not too
concerned about opportunity cost, they are just keen to buy 1-2 properties that
can hold onto for 15-25 years to use as a pension. That is fine if that is your
strategy ? but for me that is too broad a strategy, carries risks and is not
maximising the opportunities available.
For me I have always had a
philosophy, rightly or wrongly, that I should always be working my money hard.
What does this mean? Well as soon as I feel my money has made a significant
return and the returns are likely to drop
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realising my profits and investing elsewhere ie when I feel the opportunity
elsewhere is greater than the current opportunity.
The great thing with
property is this does not necessarily mean selling, as you can refinance, and
invest money elsewhere.
This is no different to any other type of
investing, such as buying stocks and shares ? you makelose your money depending
on what price you paid, and what price you sold at ? although clearly with
property is good opportunity to earn a regular income as well - if hold onto for
15-25 years you should make
mon
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Home > Family > Family BusinessHow To Balance Your Home And Business When You Work At Home
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