A rose syrup by any other brand would taste as sweet

Me and a group of friends were preparing for a retro theme party the other day. We all agreed that rose syrup cordial was a must-have. However, we absolutely failed to agree on the brand.

A went, "Brand X has a more fragrant scent!"

And B went "But brand Y has a nicer color!"

C joined in the fray "Who cares about those! Brand Z tastes least artificial!"

Suddenly it occurred to me, that a rose by any other name smells just as sweet. Likewise, a rose syrup by any other brand, would taste just as sweet.

No discussion about the property market in Singapore is complete without also looking at public housing. It forms the bedrock of foundation. The HDB resale price index is still on the rise. Any property investor worth his salt would tell you, HDB has hitherto been the highest yielding residential property asset class. The question now then, is: Is it still that?

Lets take a look at recent movements in the resale market for a matured estate HDB like Bedok.

Focus on Blk 214. From the recently resold pricing, you can tell that the yield is still very decent at above 5.5%.

Now let's look at a non matured estate Bt Panjang. Check out Blk 250. Similarly, a great yield is possible. This time even better at above 7%!

Those were the resale prices. Imagine what yield would be for the first hand BTO owner?

Popiah and the Psychology of Paper Profit

There was a gathering coming up and it was decided we were all going to DIY and make popiah (chinese spring roll).

As 5 out of 6 people in the group were retired or in between jobs, given the social atmosphere of austerity and belt tightening, we had a budget drawn up. I was tasked with the enviable responsibility of getting the popiah skin.

With a price cap of $10 in mind (actually also in reality), I went about the co-op supermarket on my CSI popiah skin hunt. There were a few familiar brands and one popular (popiahlar?) one was going for just under the budget at 9.50. Thinking it was just 5 minutes into the hunt, surely I need to do more due diligence. Plus I would look even better in front of my jobless banker and auditor friends if I hit a  lower price.

After a few more encounters exceeding budget, I walked over to the next supermarket few blocks away. A ha! Same brand and cheaper by 50 cents! But... Seems like the expiry date was near. So I sheepishly went back to the co-op for the 9.50 branded one. Then I thought again, hey, we are having the gathering three days away, and it would most certainly still be within the month of expiry. Gloating with my realization, I trekked over back to the 9.00 skin supermarket just...

To realise the last pack had already been bought. Darn! Could have...would have...should have... Yet I still felt sore that I simply couldn't bear to pay 50 cents more.

Taken from Investorglossary.com:

"A paper profit is a unrealized gain on a security or asset. For example, suppose 10 shares of Acme stock are bought at $8 and two months later the stock is selling at $12. The paper profit is (10X12)-(10X8), or $40. If the stock was sold, the paper profit would become a realized profit. A paper profit is just that - a profit on paper only - and should never be confused with a tangible gain. First, a paper profit is usually reduced significantly by both taxes and transaction costs upon realization. Moreover, a paper profit can become an important psychological obstacle to successful investing. Suppose Acme falls back to $10 and part of the paper profit disappears. Some investors will find it hard to sell the shares until they climb back to $12 and the full paper profit re-emerges. In this way, an historical paper profit can make an investor hold a stock too long and forego better investment opportunities."

Indeed, the same can be said of property.

Well, I guess I had nothing much to shout about to my popiah friends then.

Passe is the new Posse

The steamboat is a traditional old fashioned 'must have' for every Chinese New Year reunion dinner. Piping hot broth cooked to perfection with pork bones (and MSG if you are having it outside). You then dump raw veges and yam in it while cooking your own servings of meat, fish, quail eggs or whatever you fancy in a netted ladle dipping it in to the bubbling soup.

That was the classic way, and rarely eaten outside of reunion gatherings. There then was a period in time when fish head steamboat became popular. This was where fish head and sliced fish formed the main dish to be cooked in the steamboat. Recent years have seen a resurgence of the steamboat. I am not sure if our candid and friendly migrant workers from China had anything to do with it - since they were the main patrons of steamboat eateries sprouting up along Geylang and Chinatown - but the young and happening don't call today's versions 'steamboat'anymore. They go by import sounding names like Shabu Shabu and Korean hotpot. Many even offer a choice of soup in 'yuan yang' (yin yang?) settings, where a pot is split into halves, each having different broths. So now those allergic to seafood or intolerant of spicy tom yam (like me) can enjoy the meal with other so called more normal friends.

Balestier has always been known as a diverse and culturally rich, yet poorer cousin of Novena. Light shops, seedy budget hotels and good food abound, with a splattering of beautiful conservation shophouses and terraces here and there. With the new Zhong Shan Park and branded business class hotels under construction, interest has been returning to this vicinity the past year. Both pure residential and mixed commercial projects proved to be hot cakes. One Dusun was sold out in a mere 2 days (http://sg-realestate-sg.blogspot.sg/2012/08/another-successful-launch-one-dusun.html). And shoeboxes have even been pushing 2000psf lately. We are going to see a gradual rejuvenation of the entire stretch with new projects topping out along nicely. Finally, the old dame has awoken with a whole new dress, and we might not even be seeing her full potential just yet.

Donuts and Doormats

I remember fondly years back, how my bff would tell me exciting stories about how he finally managed to get his hands on those donuts at the shop in the basement of his office building in town. He would snap photos of the multi colored rings and share on his fb page for all to see.

Although never quite the donut fan, I marvelled how some can queue for hours just for...well, donuts.

Perhaps they injected some addictive compound into their goods? :-)

These could cost as much as ten bucks for half a dozen. The good old ordinary donuts sold in bakeries were probably less than half the price.

Fast forward to today.

Pavillon Square, a 'brand new' retail concept gracing Geylang, just sold out on a Saturday. All 90+ units of mostly MM sized shops. Now there was even mention of one sold at a staggering $10xxx psf. Almost the price level of high traffic Orchard Rd shops!

I think the next CM (on commercial units) is not far... but URA has already released guidelines to prevent a repeat showing, so perhaps not. Let us all focus on the upcoming BTO for singles in July for the time being, shall we...

So if the donuts craze was a fad, it sure lasted a while.

How long do you think this shoebox shop fever will last?

Relativity and Bubble Tea

Long long time ago, but not nearly as far back when mata wore shorts, we were happy drinking our ice lemon tea and kopi c. Whether in the school canteen or kopitiam, they were always home brewed and prepared, served by moody uncles or pissed looking aunties fighting pms. No preservatives.

Fast forward to today, in a modern aircon stall in a busy shopping mall, served by giggly youths, we have the same thing - fruit flavored or coffee and milk cold drinks, except at 3x the price and nicely packaged in air tight spill proof high tech packaging. Add to that a dose of 'bubbles', essentially gelatinous balls, for a nice chew, which gives a nice 10% add on to the already wonderful profit. A nice large diameter thick straw completes the offering. Hey, you even get to pick your color!

So the smart kopitiam uncle and auntie buys the bubble tea cup sealing equipment and supplies, sets up a corner at their drinks stall, and sells their own brand of bubble tea at 30% off the shopping mall brands. They even concocted chinchow and bandung bubbles. I probably have never seen them smiling from cheek to cheek endless with the throngs of school kids lining up for their fix.

Now apply that formula to property projects. Have you ever wondered how some new projects can actually help pull up the price of older ones in the vicinity?

Take for example, the Echelon launched in Dec 2012, saw impressive takeup in a matter of days. Packaged with the latest bells and whistles in luxury fittings and facilities, the average psf hit was as high as 1700psf. 

Contrast that to Ascentia Sky, launched few years back at 1200psf. It has since completed building and how much do you think the owners are now asking for?

That's the power of relativity and vicinity. So as you make your next killing, be sure to do your research on your target projects' vicinity. If there are announced government plans for plots of land sales, whether reserved or confirmed, you can be quite sure you have one leg in the bank vault already.

Meanwhile, I will head for my kopitiam bubble tea with attap chee pearls...

Food Courts and Agents (Property, and then some)

A friend from Germany recently visited me and asked me how he could try all sorts of local delights in one sitting. Cheap (for obvious reasons, considering the financial turmoil of the EU). Instantly, I thought of food courts. We have Kopitiam, Food Republic, Food Junction... the list goes on.

Food courts are usually operated by a third party who brings together various local stallholders creating a mish-mash menu of local food variety on a single platform. Many even have their own cash card and reward points system. They are like an agent, or middleman, so to speak. Just imagine if you had to try all the char kuay teow, rojak, yong tau foo, chai tow kueh, satay, bee hoon goreng, roti prata, tau suan in one sitting. It would have probably taken you one whole day across the island.

Actually, mankind survived eons ago without such agents or "in-betweeners".

Today, we rely on agents all the time.

Buy/sell houses - property agents
Send letter - postal agent
Daily newspaper - news agent
Get milk - milkman
Send money - money transfer agent
Get insured - insurance agent
Get a (new) job - recruitment agent!

... and then some.

Question then: Why do we pay extra for all these?

Imagine a world without agents. On a typical day, this happens.

07:30-08:00 - Wake up, walk over to the convenience store to get milk.

08:00-08:30 - Wash up and breakfast.

08:30-09:00 - Prepare letter and get dressed for work.

09:00-10:00 - Commute to office from Bedok to Jurong and drop by IRAS to hand deliver (remember, no postal agent) letter. And oh boy, I'm already late for work!

11:00 - In a meeting but not paying attention. I need to plan for the next days' schedule - obviously - as I do everything MYSELF! (Oh man, I just asked the boss to repeat his question TWICE!)

13:00-14:30 - Sneak out during lunch to handle house viewing myself. Because my house is in Bedok and office in Jurong, the to and fro commute and viewing already ate into my work time!

15:00 - Get big scolding by boss for coming in late and having super long lunch. :(

16:00-16:45 - Sneak out during tea break to attend interview for new job. Realised only after that it was a waste of time as the job description had little detail and they did not mention they really wanted a MBA holder!

16:50 - Called into boss office again and given warning letter. "Come in late, super long lunch, can still go for long tea break!?" :( :(

17:00 - Feeling sorry and miserable. 8~(

18:00 - Knock off time, and I need to visit Western Union to send money to my retired parents in Australia. Really tired and zero energy. Maybe another day. They are sure to call me and scream.

18:30 - Just realised I have not visited the insurer to discuss my medical coverage extension... :( :( :(

19:00 - Sitting at home completely dazed. Hungry but no mood to make dinner. Knocked out on the sofa from sheer exhaustion.

Now I know why we need agents.

For the uninitiated, it's because as typical Singaporeans, we like to pack as much as we can into a single day. Hey, we even use 'agents' (foreign domestic help) to take care of our children! What else can't we accomplish?

Groceries Management Part II

If you are one of the fortunate (or unfortunate, depending on the market cycle) few to own a couple of properties, you would have had first hand experience at managing and letting them. After a while, especially if you hold a day job, it can get rather nerve wrecking. I'm talking about needy tenants and those who are not used to taking care of stuff with their own hands.

"Oh, the bulb just blew, and I'm scared of heights. So can you please make a trip and help me replace it?"

"There was a power trip! What should I do! HELLLLLLLLLLLLLPP!!!!!!!!"

"Secondhand smoke from the neighbour kept drifting into my bedroom, can you come down and speak to them a bit?"

Sometimes, making the trip and spending the money on cabs (if you are lucky to get one quickly) for groceries shopping can make one feel weary and drained. Thank goodness for the internet - major grocers have an online presence so much so you can easily find most if not all of the goods for your shopping pleasure. All you need is a few clicks and your credit card and what you need will appear at your doorstep soon enough. Just pay for the nominal delivery fee.

Likewise, if you do not want any of the hassle dealing directly with needy tenants, you can spend some on commissions and engage a real estate agent to handle the whole process from soliciting, viewing, closing and all the follow up after moving in. You will still get your rental income right on time and you never even have to meet your tenant ever, if you prefer!