The Informed Investor · Chapter Three
Buying is the transaction. Ownership is the investment.
Buying is the beginning of the calculation
The purchase price is only one part of the investment. Ownership introduces a new set of commitments, cash flows and decisions that deserve equal attention.
A complete calculation includes more than the price
Service charges, financing, timing, currency exposure and transaction costs all belong in the equation from day one. Planning for them is what separates a professional forecast from a guess.
Ownership costs fall into four categories
- Predictable costs — service charges, insurance, routine maintenance.
- Transaction costs — transfer fees, agency fees, administrative costs.
- Market costs — vacancy, currency.
- Capital costs — opportunity cost, interest rate exposure.
A framework, not a checklist.
Service charges continue long after purchase
Well-managed buildings require ongoing investment. Understanding annual ownership costs from the outset avoids surprises later and produces more realistic projections.
Vacancy is a cost of income-producing property
For investment properties, vacant periods reduce income while ownership costs continue. Understanding this relationship produces realistic cash-flow expectations.
A multi-year investment is also a currency position
For international investors, every payment and every future return is ultimately measured in another currency. Exchange rates become part of long-term investment performance.
Every dirham has an alternative use
Whether a property generates rental income, saves rent through owner occupation, or appreciates during construction, the question remains: how does this compare with the alternatives?
Gross return and net return are not the same number
When ownership costs are incorporated into the calculation, gross return becomes net return. Net return is ultimately what the investor keeps.
Good investors don’t budget for the purchase. They budget for the ownership.
Every property has a price. Every investment has a cost. Knowing the difference is where better decisions begin.
At Majolica, every recommendation begins with a complete ownership analysis — not just a purchase price. Start a conversation
The chapter as published
