Luxury Flipping

This week's The EDGE just came out. Along with it, is the copy of Options - the Pull-Out section.

Quotable quotes from Options:

"LUXURY IS KNOWLEDGE. It is owning a story; only the owner will have that personal knowledge about a product. And it's about enjoying pure aesthetics, the pleasure of the senses that's related to the mind. Did you know that the word luxury comes from the Latin word luxes meaning light, knowledge or enlightenment? In French, it is luxar, which means lust."

-Philippe Galtie, managing director of Cartier Singapore, Malaysia and Indonesia.

"THERE ARE ALWAYS OPPORTUNITIES through which businessmen can profit handsomely if they will only recognise and sieze them."

-J Paul Getty, US oil industrialist.


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So, what is Flipping? I found it in The EDGE yet again: a new discovery every day. Ref: City & Country pull-out, October 3rd 2005, The EDGE:

"NEWSPAPERS AND OTHER MEDIA brim over with expanded coverage of real estate and all its trappings, including cable TV shows celebrating the game of flipping - buying houses, fixing them up and selling them again in short order for a handy profit."

-Chet Currier, Bloomberg News columnist.

Mr. Currier proceeds to quote Mr. John T Reed, who says that such TV shows misrepresent that real estate is the easy road to getting rich. However, Mr. Currier does recognise that "houses can be much nicer to look at and cosier to occupy than a bond or a stock certificate." Given the choice, I'd say that buying a stock certificate doesn't take as much investment, but possessing a house is concrete reality, and you can live in it or rent it out. It's rather like that latest article in this week's The EDGE, where after comparing the net worth of Google Inc, and Indonesia, Bloomberg News columnist William Pesek Jr concludes that despite her lagging economy and rife corruption, Indonesia, as an investment, wins hands down over Google Inc. He points to Korea and Microsoft: In 1998, Microsoft Corp had bigger market capitalization compared to South Korea. At present, South Korea's capitalization is US$530 billion and Microsoft's is US$272 billion.

Buying and selling houses seems to be an interesting art. Rehabilitating old houses is certainly one way of doing business. It should be, I imagine, quite an enjoyable one. Even if the house is not touched up, there is every chance that if sold below market value, an old house can still attract many a buyer. That aside, it is interesting to see what could happen if some enterprising soul were to come up with a local version of the shows that Mr. Currier refers to. Renovating a house, refurbishing it or rehabilitating it -- it's all just semantics. Sometimes, you'd have to get to the gyst of things: and renovating/refurbishing/rehabilitating a house for resale, the last I checked, was known as profit-making. Still, real estate is considerably much cheaper in the USA or even UK. This is why a programme like Pimp My Ride featuring rapper XZibit is viable in the USA but sadly would be hard pressed to find funding in good old tropical Malaysia.