Sometimes the best investment is … no investment!


The summer of 2008

While the real estate bubble was coming to an end, I was trying to find investment opportunities for my clients. But most of the time I couldn’t find properties that I considered right.

2 commercial spaces on Mihai Bravu Street

At this time, a client wanted to buy a commercial space with a good yield. But I could only find class 3 properties or class 1 properties with prices close to those in … Paris. I only had 2 “reasonable” properties, 2 commercial spaces on Mihai Bravu Street: a small pastry shop, a corner property and a pharmacy, behind some trees. I was arguing with my colleagues that insisted we promote these properties. “5% is good, the rate for a deposit is 2%” my client told me. I said that the investment is not worth the risk and my advice was that we should not move forward.

When investing in a property, feelings are the last things to consider

I don’t need to tell you that my advice to NOT invest was appreciated by the client. A year later we found much better options, after 2 more years there were even more. I understood his initial negative reaction to my approach. When we make the decision to buy or rent a property in order to start a business, we are convinced that it’s the right time for us. We only see the positive scenario. Here, in Romania, this attitude is very frequent. Many people describe business as being actions in which only luck and tricks are important:

– “I will sell this property because others are making money and I want to make some, as well”


– “I think it’s a good idea. Why shouldn’t I double or triple my investment?”

The perfect victims

Many times, in Romania, we see people that are in a hurry to invest. Usually they are the same people that want to avoid additional costs and do not look for professional consultants in order to guide them. They know what they want and they want everything NOW. Do you know what I call people like this? The perfect victims.

They’re willing to buy anything, without a proper checking process, just because it looks attractive. Or they buy anything that is available, choosing from the options that they find. When they realize they were tricked, they blame anyone but themselves and insist that they “did not find anything better”.

Sometimes the best investment is … no investment!

In the real estate world of today, we think that the market is filled with offers at very low prices. It’s not a realistic opinion, though. There are times in which good offers are few and far in between: sometimes it’s not worth it to even check them out.

“And what can we do in this situation?” you might ask.

It’s simple. Don’t invest! Put the money in a bank, collect the interest, keep a close eye on the market (or collaborate with professionals that will do this for you) and wait for a few weeks or months. Your money isn’t limitless and playing with them is not the answer. The choice between 2 bad options can cause financial damages and you can lose the money you’ve collected in a lifetime of hard work.

Sometimes the best investment is no investment!

It’s a good decision for the client = it should be good for the real estate professionals as well

I’m a real estate broker and consultant and my interest is to take part in as many transactions as possible. But this does not mean that I have to simply take my client’s money and run, by choosing to sell him a bad investment. The commission is important but it will not alter my life. If he loses part of his capital, it might destroy him.

Particularly in turbulent economic times, as the one we are going through now, the right choice is to be conservative when it comes to investments. Don’t let yourselves get tricked, it might prove out to be very risky. A better and more stable opportunity will come soon.

What is your opinion?