Property News & Market Trends

Property Investment Made Simple - Part 1

Who says you can't invest with little or no money down(nMd) in Singapore? 99.999% of the investing population would say so, I think.

Then again, why not? If we didn't try, how can we derive the impossibility of a human's ingenuity? Honestly, I've yet to see a successful deal myself, though I've heard of someone hearing from another. Far fetch? Let's analyse.

To succeed, firstly, we have to find a potential. The following are cases with good potential:
1)  Desperate sellers; divorce, death, troubled homes
2)  Cash-rich sellers; ROI-centric, Interest-centric
3)  Odd properties; obstacles-ladened, low-valued & desolated

Desperado properties are key targets
A good analogy would be the sub-prime disaster that hit Citigroup. In the desperate need to look for foreign funds, they are agreeable to something they would never have considered - convertible stocks up to an exchange for 4% of Citigroup to GIC in exchange for $6b. How would Singapore get such an opportunity if Citigroup is not desperate? Not to mention the earlier UBS purchase.

It's unfortunate if you have to "prey" on the unfortunate. It's sad but that's life. In desperation, opportunities arise for others to take advantage on. Remember our "national quarrelling neighbours" - the dancing half-naked man with a highly educated daughter? How many of the neighbours would want out? Who would want to buy them? Can they command a market value? Unlikely. There are many troubled properties out there. Homes beside petrol stations, facing a cemetry, loan-shark infested, etc. Aren't they difficult properties to market? Agents usually avoided them like a plague. Just let them know you're looking for such properties.

Cash-Rich properties are welcome
On the other hand, if a seller is cash-rich, they would be more interested in higher returns than pure cash upfront. That's what banks & finance companies are looking for, aren't they? They are only interested in returns. Imagine you bought a property with no loan, will the bank be excited over you? Nope. They will try all means to get you to borrow as much as you're "qualified" to borrow. Of course, if you are a little/nMd buyer, they'll look away. Sorry. Banks or finance companies only lend to those who don't need them, as expected. Sigh, that's life too. Let's move on.

Look out for wealthy investors, institutions, associations, clans or any families with a string of properties. These groups are more interested in returns than cash redundancy. Imagine placing millions of dollars in banks with 1.75% pa? If they're selling one to buy another, they would need to find one with greater potential(with greater risks) for better returns. Now, why would they want to go through the trouble just to take a risk for an unassured increase in returns? Got a better suggestion? You think.

Odd Odd Properties, here we come!
Ever heard of someone buying a car park? Never cross your mind? How about getting a container-office? Or fancy the property facing the ugly cemetry? Have you check out what's on offer by the MND? There are plenty. How about a piece of empty land with overgrown grasses in the middle of nowhere? Now, now before you say no, think about it again.

The "crazy" fella who bought a car park, got a great deal when the plot ratio of the building increases. He sold off with a 38% profit in less than 6 months! His upfront cash? He didn't mention. But I estimate he only put down a 1% option, brought in another tenant to pay 9% for 6 permanent lots, used the cash deposits by season ticket holders and started pushing the MCST to seek a "re-evaluation" of an enbloc sale. Though the enbloc didn't succeed, his "valuation" did increased. Unique but one "crazy" case proven me wrong!

Container-offices? Who wants it? Why would anyone buy them? That was my odd question when someone approach me in 1995. Property prices were crazy. Office spaces were scarce, just like today's situation. I don't know if he went ahead to buy them. All he need was $8,000 for 3 used containers. With a long-term lease of carparks, specially approved by URA, a little air-con fittings, a paint job, he can easily set it up for less than $12,000. He can rent them out at $1,500-$1,800 per month. He would have covered cost in just 6 months! I didn't believe him. What a sucker I was. I remembered seeing a chain of container-offices somewhere in Lavendar some time ago. I hope they were his.

The empty piece of unusable land was rented out to construction companies to build dormitaries for their foreign workers. Cemetries are being emptied now. The last I heard, Mt Vernon will be gone in the coming years.

What I'm trying to say is this - they aren't any such deals available until we start looking for them. I believe some of you can find them. I will be excited to help you along if you found one. Just email me. It's free service!

Once you've located them, explore all possibilities. Just a few tips before making any offer:
Tip#1 - Never compete with a potential buyer of market value. Walk away. The idea is to find a property where nobody wants. No buts... if nobody wants it, why should you? Hmm? Exactly.
Tip#2 - Never open the little/nMd option on the first viewing. Never. Don't you ever scare the least potential away!
Tip#3 - Probe. Probe. Probe. You need to know the pain/desire of the seller. Not through the Seller-Agent. Ask to talk directly to the seller. However, please be ethical. Never cut off the agent. He can easily destroy the fragile deal.
Tip#4 - Identify the type of Seller, his deadline, his priority. Meet his 1st need.
Tip#5 - Offer him a higher value than he expected. Why? You'll find out.

It's important to realise that such deals are never easy to find. The fact is, we're not looking for 10 cases a month, but just 1 case to chase. It may take you months to locate one. But the satisfaction of closing such a deal is invaluable. Is it possible? In a good market, it's 100x harder. In 2008, there will be several if you look hard enough.

Hope you'll find one soon. We'll touch on the tips again the next round. See ya!

Bingo! U got a match!

More ...

	Millionaire Agent - Part 2 The most agonising first step to a millionaire agent's work style - how to start right? 1] Don't just follow what everybody does.  Copy the successful ones only. Destroy all previous actions, thoughts, knowledge you learn or picked up that don't work. If you do the same things the same way as ... 28 Mar 2008 - Read Details
	Property Investment Made Simple - Part 3 Sorry for the long delay. But I hope the wait is worth it. This week, we cover a great opportunity we may see this year - Foreclosures. Foreclosures are properties repossessed by banks. Normally, they are sold at a slight discount after an auction. However, for unwanted properties, they may not eve ... 26 Feb 2008 - Read Details
	Millionaire Agent - Part 1 Happy Lunar New Year! Do you believe in sayings of the 12 chinese horoscope?  Let me be very upfront with you. Bill Gates, Warren Buffet, Jerry Yang(Yahoo), Larry Page(Google) and you name them, from the western world will never know what holds for them under the 12 chinese horoscope. To t ... 8 Feb 2008 - Read Details
	Property Investment Made Simple - Part 2 Happy Lunar New Year! I know, I owe you a detailed explanation of the tips I gave in Part 1. Let's refresh our memory a bit. I mentioned that I'm open to any interesting deals that you may have but I can't be "there" with you to analyse the property. You must fill me in as much as you can. The more ... 4 Feb 2008 - Read Details
	Want to be a Millionaire Agent? 4 Hurdles of a Millionaire Real Estate Agent.How you can rake in $500k year after year! Someone once asked me if he should switch from a comfortable job of $4k per month to be a Real Estate Agent. Many of his friends and family members asked him "Why?". I asked "Why not?" I entered the real estat ... 21 Jan 2008 - Read Details
	Property Investment Made Simple - Introductory Is it too late to learn about property investment? All the action seems to happen in the first half of 2007. Let me assure you it's not. However, if your intention is to make a quick fortune, that's speculating, not investing. And it's over. Property investment is a long term hobby that can eventua ... 5 Jan 2008 - Read Details
	If you're selling or buying, be precise, be prepared. The report book for 2007 is out - private residential prices in Singapore rose 31%. As of the 3rd quarter, URA reports that there were 65,400 private residential units under construction, 41,600 expected to be completed between 2008 and 2010. Of the current supply, there are still 38 ... 4 Jan 2008 - Read Details
	Happy New Year yet again - How happy? It's a sad occassion for many, in fact. Firstly, for every owner who managed to sell beyond expectations, there were at least 7 who failed to sell at all. From Oct - Dec, transactions had dampened so much, many veteran Agents ponder if it's the sub-prime that spooked the buyers even after the ghost ... 1 Jan 2008 - Read Details
	Merry X'mas & a joyous New Year! Seasons greetings to all! What a year we had in 2007! It's been a long time since I wrote and it's gooood to be back! Interestingly enough, I should end this chapter in 2007 and begin a new series for 2008. 2007 had been both an exciting yet challenging year for the real estate industry. The ... 31 Dec 2007 - Read Details
	How do you define "Trading" in property investment? Recently, the High Court accept a "Fengshui" appeal but reject the "Tenant" problem situation for taxing a couple's property investment.  This is a public awareness drive by the Taxman to 'highlight" the many property speculators, option traders that "trading" properties for profit IS taxable, ... 12 Sep 2007 - Read Details