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!

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.

Location, Location, Lor Mai Khai

Lor Mai Khai is usually seen as a quick snack when you are in a rush and have no time for a sit down proper meal. It costs probably only half to one third of a normal meal but supplies the needed calories and carbs (and fats). Made of glutinous rice, you will likely find that it can help you last another 3-4 hours before the next feeding.

Yet to some, Lor Mai Khai can be a guilty indulgence or even regular tea break staple. I know that for a fact as I have a colleague back in the army like that, and a few 'guilty as charged' ex colleagues too. So you see, a seemingly common thing as Lor Mai Khai can mean very different things to different people.

One often wonders about the true relevance of Location when it comes to deciding on a home purchase. Is it important that it must be in the prime district? A quiet residential enclave? Somewhere you cannot see public housing in view? Must it be near the family? Near the in laws? To good schools? Walking distance to public transport and mrt stations? The fitness center? Your regular soccer buddies pitch? Pubs and clubs where you hang out? Convenient stores and supermarket? Eateries? Posh restaurants to entertain visitors? Clinic and hospitals? The vet or pet supplies store? The list goes on...

Depending on your priorities, you will find Location could mean very different things to different people, just like Lor Mai Khai. Good luck in your search for that ultimate house or snack that fulfils most of your (if not all of your) desires.

Tapas as Bite-sized Mickey Mouse Apartments

Lunching a few days back at the Pu Tien restaurant for Mother's day, the first dish was the quintessential cold dish with food samplings of interesting stuff. I shall not go into detail what those were, but little bite-sized morsels are often the starters or even the main course in many cuisines. I'm sure many of you would instantly think of Spanish tapas.

The trick is - if you're hungering for more yet want variety, tapas often do the trick. You get the fill, and you get the variety. Heck, you even get the choice. Choose what you want - when you want. Variety is great as a man without a choice is a dead man in a dead end.

That is the same reason why sales of MM apartments (or Mickey Mouse apartments - size of which are 500sf and below - as they are affectionately called) have continued to skyrocket. The magic word nowadays is 'low quantum' - nevermind if that meant 1600psf for a MM unit in Siglap. The absolute amount you can bite on, is still 500k! Developers (smart ones) will take heed and reconfigure the projects into more bite-sized quantum units. Even major condo grade projects can't resist including bite-sized MM units for the specu-vestors or maybe there is really too many lonely singles wanting to live on their own these days, what with the gradual westernization of asian culture. In any case, if you're hungry and have limited pocket depths, you will still have to eat. At least you can now choose something that won't give you indigestion.

Up Up and Away!

Last Sunday while collecting mail at my tenanted apartment, I figured since it was lunch time I might as well make my way to the Lavender food court for a change since my favorite Killiney kopitiam opposite my apartment is no longer in business. There, I ordered duck rice, and noticed the (famous) wanton mee store has nobody in the queue. I thought it was not open yet. Then at 12:03pm, a queue started to form and in 5 minutes it has grown from 5 people to like 15-20 people.

Locals will know this is typical of Singapore and Singaporeans. I have ever even been in a queue and someone join it behind me asking me what I'm queueing for after others have joined in behind him. And therefore the perfect display of 'herd mentality' which stems from the Singaporean essential attribute of 'kiasu' (afraid to lose out).

Look at the recent launches since Alexis / Caspian, and you will notice almost every project SOLD OUT in days if not hours. Optima even had queues form before the showflat is officially open. Can you imagine this madness - in a recession? Or are we already so sure prices are only going to go up with the impending completion of IR. Soon, 600psf in Bedok new launches will be a thing of the past - if not already - when Optima in Tanah Merah has seen prices of 900psf-1000psf. AMK had launched at 1200psf. Balestier is being launched for 1400psf as we speak. Soon, nothing will be below 1000psf.

Sure, one can say, the mata (policemen) also had to start wearing pants instead of shorts as Singapore progresses through the decades, so why not property prices? I'm just wondering whether this pace is too fast. Anyway, I'm not fast to complain, considering this market upswing helped me to 'get rid' of my odd shaped apartment at a very decent price - enough to buy 2 new better and regular-shaped ones.

Heck, for every willing buyer, there is a willing seller. Same goes for wanton mee even if the price is $5 - when everyone seems to be just queueing (or killing) for it.