16.01.2023, 13:40

Earning more than 100 billion from land trading, veteran investors reveal the secret of asset preservation

Earning more than 100 billion from land trading, veteran investors reveal the secret of asset preservation

Witnessing the period 2011-2013 when real estate prices plummeted continuously, a veteran investor decided to liquidate most of the real estate in 2019, accepting “not to be out of the market”. Up to now, when the market is quiet and land prices are low, this investor still preserves the money he has earned for more than 15 years in the real estate profession.

That is the story of investor NM (from the province in the central region). In 2007, after graduating from university, Mr. NM applied for a brokerage at a large real estate company. At that time, Mr. M. said that “real estate is the profession of the rich”. With the thought: “If you want to be rich, you must meet and play with rich people? To understand how rich people make money?” of a fresh graduate made Mr. NM determined to pursue a career in real estate brokerage even though he had never had any experience. He said, at that time, people did not call the profession of intermediaries as “salesmen” but mainly by the word “stork” with little respect.

In 2008, Mr. M and his friends contributed capital to establish a real estate company to facilitate transactions with customers. Less than 1 year later, Mr. M.’s company went bankrupt. The debt that Mr. M. carries is up to nearly 40 million VND, equivalent to the total cost of going to a 4-year university. This has caused Mr. M., a 2 year graduate student, to fall into a difficult and difficult period.

In 2009-2011, right at the time when the real estate market was vibrant, not only did he successfully broker many deals, but Mr. M. also had the opportunity to contribute capital to invest with his friends to buy land for subdivision and sell for profit. In 2011, Mr. M. decided to contribute money to the landowner, divide the plots and sell the profits, and share the commission.

By the end of 2011, the total assets that Mr. M. earned was nearly 3 billion VND. But just a few months later, when the market crashed, the plots of land that Mr. M. owned quickly dropped by 50%. “At that time, I was also afraid when the land price dropped continuously, I could not get rid of the goods. Money is hard to come by.” That was the time when Mr. M. witnessed his friends who were rich from the land, had to sell their houses, sell cars, and switch jobs to earn a living.

By 2013, when the real estate market began to show signs of warming, Mr. M. boldly put down money to buy a large plot of land on the outskirts of the city, build a house for sale. By 2015, the results after many years of efforts gradually had “sweet fruits”. Thanks to buying and selling, as well as investing in construction, by 2018, his total assets are estimated at more than 100 billion VND.

However, in 2019, when the central real estate market showed signs of decreasing liquidity, Mr. M. decided to gradually sell land lots and properties to recover cash.

“Actually, deciding to sell most of my assets, no longer rolling around with real estate investment, I was a bit disappointed. But going through the period 2011-2013 has made me realize that, if I don’t know when to stop, accept satisfaction, I will be able to “lay dead” on the pile of assets. That’s why I decided to sell most of it in 2019. And by 2020, affected by the Covid-19 epidemic, many land lots have decreased by 10-20% in value. If assuming all the land that I hold until 2020, with such a decrease in price, my total assets have disappeared by 20% of the amount. In 2022, the real estate market was really quiet. Many of my friends could not get out of the goods in time, struggling with liquidity as well as bank debt,” Mr. M. said.

According to this investor, “The law of the market is always the same. After the strong growth fever, it is certain to move sideways or lower the price. So, I always tell myself: “Don’t be greedy, know where to stop” to remind me to decide to sell soon. In fact, for investors who consider real estate a profession, not buying and selling for a while, they are all in a state of anxiety. And psychologically, already have a lot of money, they all want more money. Especially in the period of 2020-early 2022, many places have land fever, many other people surf to make billions of money in the deal. I also feel the same way. But I determined, after many years of making money, this is the time to spend time with family. In order to miss the job, I just invested 1-3 billion VND with my friends.

Mr. M. said that up to now, he feels lucky because he got out early. Sharing about the plan in the near future, this investor said that it is expected that in 2023-2025, he will start hunting for a beautiful land fund. However, the disbursement only accounts for 50-60% of the total amount available.

Source: CafeF