Most investing articles list the reasons for buying. Here we also share the reasons we did not buy, and how we got there. Passing on a deal is not a failure; it is a decision.
What we learn from deals we passed on
A condo priced far below market, sold with a tenant in place: why we did not buy it
A condo that would normally sell for 10 to 12 million yen was listed at 8 million yen, with a tenant paying half the market rent. Little would be left each month and tenant rights are strong, so we passed.
An old-standard condo for about 3 million yen, passed on after visiting the site
An old-standard condo at about 3 million yen. Visiting by day and night, the lack of people, piled-up mail and a dark building showed it was close to neglected, so we passed.
A sunless, damp room that smelled of mold: why we passed
A room that smelled of mold the moment we entered, with no sunlight and damp air. We judged by whether a tenant would live there and whether we would ourselves, not by the low price, and passed.
A condo with no visible management system: why we passed
A well-located, reasonably priced condo with no owners association, no reserves and costs collected only as needed. Major repairs might be impossible, so we passed.
A condo with unusually high management fees: why we passed
Repair reserve and management fees of 40,000 to 45,000 yen a month did not work against nearby rents of 80,000 to 90,000 yen, so we passed.
A second-floor unit above restaurants: why we passed
A studio of about 5 million yen on the second floor of a building with three or four restaurants downstairs. It was dim, with no direct sunlight, and prone to pests at night, so we passed.
Stock cases (for learning)
These cases show the idea of passing when you notice certain points. They are built from general situations; they are not about specific companies or real events, and the numbers are hypothetical. How prices move after passing is hindsight, so we do not say that passing “was right”.
Why a stock with an unusually high dividend yield might be passed over
A very high dividend yield can simply reflect a fallen share price. A learning case on checking for possible dividend cuts and earnings before passing.
Passing on a company with growing sales but negative operating cash flow
Sales are growing, but operating cash flow is negative and the company relies on borrowing or new shares. A learning case on reading financial statements before passing.
Passing on a leveraged product you cannot explain
A product that doubles daily moves may not behave as expected over longer periods. A learning case on passing because you cannot explain how it works.
Passing on a small stock that surged on social media buzz
A small stock surges in days on social media buzz. A learning case on passing when buzz is the only reason and nothing can be checked.
Passing on a hot IPO on its first trading day
On the first trading day, buying pours in and the price runs far above the offer price. A learning case on not chasing a first-day price set by supply and demand.
Passing on a stock bought only for its shareholder perks
Price swings can outweigh the value of the perk. A learning case on passing when the perk is the only reason to buy.
We welcome your story of an investment you passed on
We are looking for stories of properties or investments you considered but did not buy. Tell us why you passed and what you noticed, not how it turned out.
This is a record of an individual’s own decision and is not a recommendation of any property or investment. How a tenancy is treated legally depends on the circumstances, so please consult a lawyer or a licensed real estate professional before making an actual decision. Legal points here are described in the context of Japan.