Lessons from a Couple's Dispute Over 16-Property Portfolio

Case highlights importance of proper documents and the need for exit strategies

- Tan Ooi Boon

Real estate was the true love for a couple who bought and sold around 20 properties during their 15-year marriage, but it was also the source of a bitter dispute when the union broke up.

It was all brick-and-mortar bliss in the early years as the couple amassed a portfolio of 16 properties, by using their business profits and reinvesting the sales proceeds of earlier purchases.

There were five homes in Singapore with a total value of about $6 million, seven houses, flats and land plots in Malaysia worth $1.35 million or so, and four houses in the United States valued at around $100,000.

They had also invested an undisclosed sum in a British project, but that was a total loss as it turned out to be a scam.

When they divorced in 2020, the real estate became the primary source of dispute as they bickered over who had paid for what and who should get which property.

As their investing started even before they tied the knot, there were disagreements on who funded the early transactions and how sales proceeds were used to buy more properties.

The couple were also joint owners of several small companies, including a software firm and one that dabbled in the hostel and dormitory sector.

They did not need to draw salaries because the income from their family business was enough to pay for their own expenses as well as to fund some of their property purchases.

They also used sale proceeds from the properties, rental income and funds from relatives, such as contributions from the wife's mother, to add more assets to their property stash.

Their strong bias towards real estate, which led them to buy at least one residence for every year they were married, provides three insights for all property investors.

INVESTING BEYOND YOUR MEANS

No matter how lucrative you think real estate can be, it is never wise to stretch your resources so thin that you have to depend on loans to meet your living expenses.