Activate All Your Senses

5 senses of Property Investment
Five Senses of Property Investment

Sniffing out good deals in real estate is as easy as ABC when you activate all your five senses to detect potential candidates before it is released in the news.

Credits to the recent haze which led to this short conversation with a friend of mine:

  • Me: Good morning John, I see that the haze is back!
  • John: Is it? The news didn’t report anything on it last night or this morning.
  • Me: Why do you need the news to tell you that when you can already smell it?
  • John: Erm, ya. But the news never say, leh. (Singlish slang)

If you need the news to tell you that the haze is back in Singapore when you can already smell it, you are seriously going lose out a lot of good deals in life. It took almost 3 days before it is released in the news. The same scenario could have happened in a real estate setting.

  • Me: Good morning John, I see the property prices have come down by at least 10% in your area, what are you waiting for?
  • John: Huh, is it? The news didnt say anything! (Singlish Slang)
  • Me: Erm, by the time the news says it is at the bottom, it has already happened. It is probably too late.
  • John: That sounds bad, what should I do?
  • Me: Activate all your senses!

Here are some examples on using all five senses to find potential real estate investment.

Sight

You will not get the full upswing potential if you came across these from the news. You will have to know it before it appears in the news and the only way is to be extremely observant by opening your eyes wide when you are outside driving or walking.

Land Development

It means something is happening (or about to happen) when you see surveyors measuring the physical land size or when the fence around any plot of land starts appearing.

Go and speak to the workers, even though some may not share the details due to confidentiality, you could at least make some intelligent guesses by looking for telltale sign such as the logo on their helmets. Do whatever you can to get information. The more information you have, the better it is for you to decide on this potential investment. These sites will eventually cause the surrounding property price to appreciate.

Roadworks

The news has recently announced the new expressway connecting Punggol from Pasir Ris town. Are you aware of this before it is released in the news on 26th of March? If you were a little more inquisitive, you would have guessed where that half constructed motorway bridge is connecting to by some simple estimation.

When I was travelling in Taipei this February, the taxi uncle was sharing how the property price in Yilan shot up after the expressway was completed and open to public in June 2006. The same situation is likely to happen to properties in these two towns as the increased connectivity will not only attract businesses into the industrial estate but increase the demand for rental and purchases in the locality.

Public transport

Every now and then, there will be news reports on the MRT to Johor and the High Speed Rail to Kuala Lumpur on the estimated completion by 2020 and 2022 respectively. With the exchange rates crossing the 3x mark in Sept 2015, the hassle of crossing border for work, play, or even buying groceries are more appealing now. By adding two more rails into the network, imagine how many more people will be going in and out?

With its increased convenience and retreating property prices since the peak in 2015, the properties in northern and western Singapore will experience more demand in due course which will push up the prices before the supply is able to keep up.

Hearing

Gathering Session

This could be the best time to get firsthand information yet frequently taken for granted. Be attentive and pick up updates that could have an impact to the property prices in the surrounding area. Talk and listen to people around you from any profession. They could be your relatives, school mates, ex colleagues, neighbors, workers, security officer, shop owners etc. More importantly, if you are in good terms with a trusted property agent, always get insight and updates from him / her on a regular basis.

Economic Policies

The Budget 2016 is essentially the macro socio-economic view which represents the direction of the country for the next few years. This is a pretty obvious one; you should have already scrutinized every single detail to pull out potential investment candidates. Otherwise here are some parts that have significant impact on the property market:

  1. Jurong Innovation District, phase 1 to be completed by 2022. Businesses will be incentivized to set up shops here which will boost the demand for properties in this area.
  1. Industry transformation program, one- stop business grants portal, one year deferment of work permit levy hike for marine and process industries are all going to help Small and Medium Enterprises (SME) to reduce cost and have better opportunities to grow their business. With stronger support, the demand for more labor both local and foreign will increase.

When fund are set aside for development in Singapore, more often than not the initial planning stage has already started. In the near future, these development will not only revitalize the atmosphere but serve as a main driving force for pushing the value of property to greater height in that area.

Smell

Petrol Station

Do you know there was a petrol station right at someone else’s void deck in Singapore?

last petrol station under a condo st martin
Vacant site at St Martin’s, 2008

Nowadays, we can hardly find any petrol station that is physically connected to another residential building because many have relocated due to its safety concerns. The last petrol station in the core central region with such feature was at St Martin’s Mansion which many had felt the pungent smelling gas unbearable. As per Fire Safety Act, revised in June 2008, any petrol station must have a clearance of 50 meters from any residential premises and 90 meters from any place of public assembly. Hence, the relocation of this petrol station has open up opportunities of more land uses  attracting more investors to review the potential in the surrounding area.

Poulty Farms

For those who have stayed in Choa Chu Kang long enough should still remember how the foul wind carrying the smell of chicken dung from the poulty farms in Sungei Tengah had destroyed their house warming (Wild Singapore Blog, 2010). This was probably the few areas in Singapore that a ‘windy’ property is not preferred. Fortunately, all the farms have relocated since the early 2010, with one less reason of objection, do you think the demand for properties in the area will increase?

Taste

Singapore is a renowned food haven with wide cuisine variety from all over the world for all pocket sizes. Knowing that there are people who drive across the island just to eat at their favorite boutique café, if your property is less than 5 mins walk to a food cluster, do you think you property value will be relatively higher than similar properties that are more than 15 mins walk away?

Say your favorite food stall has been forced to relocate due to diminishing crowd after the start of Thomson MRT construction. Will these people return after the completion of Thomson MRT in 2021? On the other hand, new food centres will bring up both capital appreciation and rental yield for properties in that vicinity. Here is a list of the 10 new hawker centers which has already pushed up the property prices in surrounding area by a good amount.

Touch

This is a tough one and honestly we seldom get to use this sense to decide on a real estate investment. Other than the furnishes that you get to touch in a showroom to evaluate on the quality, there is basically nothing much left to touch. Let me know if you have came across instances where you used your sense of touch to make decision on real estate investment!

Conclusion

By activating your senses to the fullest, it will give you the unfair advantage to identify good properties in certain area that has potential large upswing in the near future. More importantly, this is the first step to your real estate investment venture, more work has to be done to shortlist and decide on the most suitable one to match your risk appetite.

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