More than 4000 doctors is what I have addressed in the past few years – that is an awesome number by any stretch of imagination. One thing comes across is their not wearing their scientific cap while managing their investment. Remember doctors are clearly in the upper end of the intelligence and academic pyramid of the world, but when it comes to investing they wear blinkers.

So here are some of the dialogs…

  1. I bought a property in 1980 for Rs. 10L now I am getting Rs. 3L rent from that property..that is 30% and that is awesome.

My counter: If you had invested Rs. 10L in the index in 1980 it would be worth Rs. 320*10,00,000 = Rs. 32 crores. Assuming a 2% dividend, your dividends would be Rs. 1 crore. About 1000% vs 30% that you are getting.

2. I keep buying and selling property and it is tax free because it is always reinvested in property.

My counter: Only one house is exempt from tax. If you already have a house, the second house that you buy and sell are FULLY TAXABLE. However since your return has not come up for scrutiny you do not know what mistake you are making.

3. I get 22% return on my real estate portfolio over the last 30-40 years.

My counter: Wrong. You have to put it in an excel sheet and see what return you are getting. Go to free fincal’s calculators and see the real return that you get on your RE portfolio.

and yes doctors do read this…

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