#Introduce a Week Post 5 Investment Areas by Crime Level First of all I want to notice what ...
# Initiated weekPost 5
Areas of investment by level of crime
First of all, I would like to know what differences I as an investor have to take into account in areas where crime is at a high level and for those with a low level
In investments, all types of investments, risk and chance go together.
In the United States it is customary to measure according to CLASS AE
E The highest level of crime
A The lowest level of crime.
This is added if the area is at a higher level than the class, say A + in the best area in the city
Or minus if we assume the area at a low level relative to the class, let's say B is in a less good area.
Just to illustrate, there is no need to enter into subtleties.
Most entrepreneurs will work in areas B or C (B=medium income, C=low income)
On the one hand there is meat, it is not a pampered area and the percentage of return on rent
On the other hand, it is not too dangerous as in class DE where there are areas that cannot be entered by light skinned people.
Investment amounts also vary between regions
Class B properties will be more expensive than Class C. And in these areas, because property prices are so cheap, the return on them is great and can reach very high numbers.
The problem is that the tenants will be less spacious people, who work less well, and our local management company will probably have more work.
In Class B as I mentioned, the prices will be more expensive, the tenants are more of a high quality, the return is relatively good for Class A but not as good as the C.
Our management company will be easier to manage and collect payments, tenants will be better quality and earn more than the tenants in the Class C.
And another advantage I see, the price increase will be better. Because people earn more and are more advanced and do not stick to the minimum wage like many in Class C.
I like to work in areas of medium income or higher
As a conservative entrepreneur, I would rather earn 8% in Class B than 12% in Class C and less risk…
Warren Buffett, the world's most successful investor, says:
"Law number one on investments, do not lose money.
Law number two in investments, do not forget the first law. "
Equally important, reduce transactions = buy / sell.
Because every transaction costs you money whether you earned or lost.
That's why I'm adhering to a buy-and-sell approach unless you're doing a ride.
And Rafi also costs money, but it's only done when it's profitable.
And we have a milking cow that once every few years gives birth to a new calf in the Rifai;
In the next post I will discuss the considerations that I believe every investor should put before his eyes before investing.
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Is this post also true to Flips?
Roman Goldenberg