Time, not money, key investment for success in real estate business
Property and stock investment expert Pichai Chawla explains to Pichaya Changsorn how everybody can make a fortune from investing in real estate despite having no money, as reflected in the title of his best-selling book "Get Rich by Real Estate Despite Having Not a Single Baht".Many people think: "Since I still do not have much money, I can't invest in real estate." And with this attitude, they will never get started, Pichai Chawla said.
"You should learn first and at one point, money will arrive. Don't wait to have money before getting started. [Because] you will never do it," he said.
The property and stock investment expert, who runs the B2 budget-hotel group as well as property and other businesses in Chiang Mai, said what a would-be rich person needed to invest was time.
"Go to see the properties," he said. "You have to do a practical study. After visiting 50-100 places, you will become knowledgeable."
American real-estate billionaire Donald Trump has suggested that investors start by visiting 100 properties, Pichai said.
Through visiting a lot of properties, one will learn through observing and comparing the assets, and consequently being able to distinguish good from bad real estate.
"The point is whether you can find a good thing at a good price. And then, even if you don't have money, you can present it to the bank; some of them can lend to you up to 90 per cent [of the property's appraised value]. Or you approach your friends for a joint investment, or sell it to them for a commission," he said.
Importantly, to get rich from property investment, Pichai suggested that people make regular visits to inspect real-estate sites as part of their lifestyles.
"Instead of wasting your money shopping, you can go to see properties during your free time," he said.
Pichai believes everyone can profit from real estate. Not all of the rich people in this world are particularly smart.
"There are plenty of factors: emotion, fear, luck," he said. "You see, most of [the wealthy] don't have a PhD. But they have practical knowledge, the courage to take risks, and the ability to control their minds. Sometimes, knowing too much prevents you from doing anything."
Pichai said a winner in business was usually the one who understood and could overcome psychological obstacles. "Suffering losses is part of the process of getting rich. There is a deep correlation between the times of problems and success.
"Location is certainly an important factor but it also depends on the kind of project one is developing. It would be a mistake for the developer of a five-star hotel project to be stingy on land cost, for instance.
"An excellent piece is priced at Bt28 million, whereas a modest one is offered for Bt15 million ... Sometimes, I will go for the latter. It depends on how you weigh the pros and cons. But the important thing is what are you developing. As a three-star-hotel developer that sells our rooms for Bt500 a night, location is not of much importance to us," he said.
Pichai said he personally preferred property over stock investments, since the former involved fewer psychological factors.
"Stock investing appears easier but it is in fact more difficult [to succeed]. To invest in real estate, there are a lot of procedures and things you need to study, but the risk is lower," he concluded.
nWatch the full interview conducted by Atishart Wongwuttiwat on Krungthep Turakij TV's "Business Talk" programme from 8-9pm tomorrow, January 8.