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!

Of Being A Landlord and Groceries Management

There are indeed similarities between managing your investment properties and groceries.

If you know that you're gonna use the same brand or kinds of flour, oil, seasoning and spices to prepare your meals every other day or so, it makes sense to buy in bulk a month's supply at one go. Many grocers have bulk discounts or special 'day of week' promotions. Once you have enjoyed the economy of scale of bulk purchase, obviously as foods are eventually perishable and have expiry dates, you will need to use them up within that certain time period. Otherwise stuff goes to waste. In the example above, if you're say sick of bread, the ingredients may be used to dish up something quite different, for example, pies or even cakes. Just so they don't go to waste.

In the same vein, once your investment property is ready to let, every day it is empty is money down the drain, especially if it's mortgaged. It's money out and nothing in. So instead of insisting on getting a tenant that is willing to pay the rent you expect, why not consider dropping it by say 10% - who knows, you may seal a deal right away. Dollars and cents become much more sensitive issues to the average tenant in tough times like now. The month or months of vacancy would be more than made up for with the mere 10% drop in income, more so if the signed lease is for more than year.