Regret Not Buying a Freehold Landed Property 10 years Ago!

Hello readers, I have been pretty quiet in the blogosphere lately. This is partly because of time spent putting up my properties on sale, and at the same time, looking at property to buy. Our property of interest is a landed house. Since my household is big, the natural choice is a house with bigger space. 

• Freehold landed (or 999 years old) 
• 99 years old Leasehold landed 
• Cluster House ak.a. town house or condo with terrace houses. 

The above types of landed came into my mind, but after some deliberation, I decided to go for Freehold landed property. This is because I love the fact that I own the land and the property “forever” without deprecation and also with the possibility to unlock the value when I am at an older age. Or I can simply leave it to my kids. 

The difference in pricing in terms of Price Per Square Feet (psf) are huge among these types of landed. Clearly, FH is most expensive, followed by 999 then 99 years leasehold.  

For leasehold 999 and 99 LH landed, the land belongs to you until expiry. In the case of FH, you own the land forever, unless governmental intervention. This is because ultimately our government still own all land in the country. For Cluster House, it is likened to landed in a condominium and you are NOT able to rebuilt or perform A&A (addition & alterations).  

Except for cluster houses, you can basically tear down the house, and rebuilt or do A&A subject to plot ratio, structural integrity, and URA - BCA approval. 

PRICE OF Freehold LANDED TODAY? 

About 10 years ago, I contemplated buying a landed house and had went for viewings. Back then, you can easily find a FH landed selling for SGD1,000 psf (land) +/- with a 2.5 to 3 storey 2500 to 3000 sqft built up floor area. Today, you can hardly find any in the listings at that kind of price. Perhaps the “super ulu” locations or very run-down conditions, or very odd shapes layout, then the asking price can be SGD1,000 psf (land) or lower. 

The asking price listed are commonly between SGD1,300 to 1,600 psf, with good locations or well renovated ones as high SGD2,000 psf and above. Below are typical land sizes for 3 different types of FH landed properties within my range of search. Locations such as Changi, Loyang, Tanah Merah, Jurong West, Woodlands, Admiralty, Sembawang, Yio Chu Kang (excludes those near to Lentor MRT), Sengkang, Punggol were all excluded in my consideration. 

Below are the pricing estimate. Psf is against land area.  

NUMBER OF LANDED PROPERTIES IN SINGAPORE TODAY

There are only 5% of landed house in Singapore today. 

In 1990, there were about 46,000 landed properties in Singapore. This is more than the 31,000 Condos and Other Apartments recorded - (data by Singstat). Over the course of the last thirty years, more and more HDBs and Condos and other Apartments were constructed, but definitely not for landed properties.  In 2019, there are 69,000 landed properties and 222,000 Condos and Other Apartments and more than 1 million HDB homes. 

The below chart tells it all why landed properties is very valuable in a land scarce Singapore. 

FINAL THOUGHTS

FH landed properties is really expensive. That said, I am afraid if I miss the boat buying today I will never be able to buy an affordable one in years down the road. Of course, I am those who will work out my sums properly before jumping into a big decision. 

10 years ago, I was hoping that price could be SGD 2 million for a decent condition landed property in a rather mid-level convenient location, I cannot find it back then. 

10 years later, I was hoping for SGD 3 million with the same condition. Again, it is almost not possible to find. 

10 years from now, it is likely that the price tag will be SGD 4 million and above with the same condition. And I reckon that landed property will likely average at SGD2,000 psf (land). 

Imagine that a 99 year LH Condo outside CCR already selling for more than SGD2,000 psf. Let alone a land that you owned “forever” at SGD2,000 psf. 

For now until the next ½ year or so, I will concentrate on selling my properties while eying for a home sweet freehold landed home. 

Do you think landed properties pricing will ever crash in Singapore? 

TikTok HQ in SG (Real Comments From China Chinese) – Singapore Got Talent Meh?

September 2020, TikTok owner ByteDance have announced plans to make Singapore headquarters in Asia. The China-based company reportedly worth USD100 Billions already has over 400 employees in Singapore. Their plan is to further invest billions of dollars and to add on hundreds of employees in Singapore over the next three years. TikTok had also moved some engineers to Singapore from China this year.  

It was further reported last month, that ByteDance has signed an agreement to move into a bigger office in Singapore. The lease will cover three floors of One Raffles Quay measuring over 60,000 sqft. 

It is definitely fantastic news for Singapore! 

REACTION OF MAINLAND CHINESE

My best friend who has many private banking clients in China told me the reaction of his Chinese clients to this TikTok’s announcement. 

They said (translated from Mandarin to English), 

“Singapore got talents meh? End of the day, also need the Chinese people coming over Singapore and live as expats to do the core most important jobs. It will be a complete waste of money and resources!” 

BUSINESS TIMES HEADLINES

Today’s Business Times Front Page reads, 

“Movers and shakers of the tech world: Singapore wants you!”

ROLF'S THOUGHTS

As a Singaporean, I felt a bit insulted by my friend's Chinese clients' comments. Then again, with BT's Headlines today, it left me wonder if the comments were just being brutally honest? 

Hmmm........ 

What do you think? 

This part was added after I received comments from readers:

How about CEO of local big listcos? 

If you look at STI constituents and take away REITS, and try to identify how many CEOs are locals (going through National Service, if guy), it is probably quite a feat? 

How about CEOs of DBS, OCBC, M1, Starhub, SATS, Singpost, SCM - recently changed to Singaporean CEO etc? 

So perhaps if anyone can identify the greatest Singaporean CEOs of all time who have bring companies to greater heights? 

Liew Mun Leong? Or perhaps Ng Yat Chung? 

hahahaha (you know why I laugh right!) 

Looking at the historical and current facts, can we say below? Or is it fair to say below? 

• Singaporeans are only good for CEOs of REITs that are in general "more or less" run by itself compared to many other industries' businesses? When it comes to innovation and growth? hmmm...

• Or maybe because several local big listcos are backed by our country leaders, perhaps our own country leaders do not think Singaporeans are up to the mark to hold leadership positions in local backed Corporations? Is it true that Singaporeans are only good to be SAF or Government or Stat-board leaders? 

• Could our suppressed nature of always obeying to authority without the ability or guts to voice our own opinions or to break boundaries have caused this phenomenon? 

• Are we too sheltered with an enclosed mindsets, and the lacking of "real overseas experiences" caused us to always think only: "Singapore, My Family and Me?" without looking at the Global Picture? 

• Or perhaps those Singaporeans who have talents, track records, with open mindsets, and international experiences and have guts to voice their opinions have long ago been frustrated by our local system, and already have left and seek opportunities elsewhere, without returning? 

Many successful China Chinese have work experiences outside China in the late 90s and early 2000s before returning back to their own countries! This probably is one important reason that explains the country's success

Should Singapore or can Singapore do the same? Attracting back our own talents? Or if this is even necessary in the eyes of our leaders?  

PS: I am not mocking Singaporeans. I myself is a true local bred Singaporean, going through National Service and completed by NSmen liability. For my entire career, I am always based in Singapore, although I have always worked in MNCs and have travelled widely. 

Being a concern parent, I was just wondering about what should I do for my children's future? 

Vaccine News Creates Opportunity to Buy These Stocks?

On Monday, the world received good news that Pfizer and its partner, the German company, BioNTech, announced preliminary results that suggested their vaccine was more than 90 percent effective. Together with Joe Biden’s election victory, Global Stock Market surge to record high. 

Travel, Airline, Manufacturing, Cruise, Pharm and Energy stocks rallied more than double digit percentage. SIA rose close to 15% in a day, while some airline stocks in other countries rallied more than 20%. 

But not everyone is cheering. Tech, Data, Glove manufacturer stocks suffered opposite fate. 

In the USA, Amazon and Netflix shed up to 10% or more. The most dramatic plunge is Zoom, falling from almost 500 to below 370, falling 35% within just a matter of days. 

In HKSE, China Tech stocks have a complete twist of fortune, having peaked in previous week after’s Biden’s victory. The vaccine news and the news of China drafting anti-monopolistic rules aimed at tech giants is double whammy for China Tech stocks. Alibaba lost ~18% to below 250. Meituan and JD.com sheds 20% or more. Tencent performs slightly better, perhaps due to the positive earning calls happening this week. But still falling more than 10%. 

Back at home SGX, Keppel DC Reit and Mapletree Industrial Trust tumbles ~10% or more to below 2.70 and 2.90 respectively. 

If those of you who believes that Tech companies (with the stocks aforesaid) are here to stay and will continue to outperform in the post Covid world,  I think it definitely presents a good opportunity to accumulates these stocks! 

I am going to be Hawkish myself!

Who Will Win the US Election And How Will Stocks Be Affected? How To Hedge?

WHO WILL WIN? 

On Tuesday 3 November 2020, Americans will go to the polls to decide if their next President is Republican incumbent Donald Trump, or his Democratic challenger, Joe Biden.

The latest poll has shown that Joe Biden is leading Donald Trump for the presidential election.  However it is not a guarantee that Trump will lose the election. In 2016, Hillary Clinton also had a clear lead over Trump in the polls for the entire campaign, only to lost the election. 

In my opinion, the coronavirus episode is definitely disadvantageous to Trump’s position in the election. With US having the most covid contractions and most deaths, I doubt that majority of the Americans will approve Trump’s handling of the crisis. 

Without the covid pandemic, I think Trump will have a landslide victory. It has almost become apparent in my opinion that most Americans love to be believed in Trump’s anti-China policies and his relentless cheerleading support for the stock markets. 

To me, it is almost like Coronavirus is taking place in 2020 to oust Trump from his absolute supremacy. Without which, people will just continue to be blinded and support evil in the making. B 

My take is Biden to have a slim victory! 

I can be wrong, because who knows what the devil has up his sleeves?  Anyway, the world is becoming more and more selfish and self-centred, and everything we do is about what is there for me to benefit with less and less compassion for others. 

HOW WILL STOCKS BE AFFECTED? 

Below is an extract from Business Times, showing the stock beneficiaries of different outcome to the election. 

HOW AM I HEDGING? 

I am not really betting on individual stock, but I think I am more or less “hedged” regardless the outcome. 

This is because I owned shares operating in US, China, and Singapore. 

I believe that even Trump’s victory should not dampen the growth of Chinese stocks too much as their focus is domestic consumption and Covid is much better control in China. And Trump’s victory will also drive up the value of my ownings in US Tech and Pharm stocks.  

If Biden wins, then, Chinese tech stocks will continue to rally, and perhaps Singapore’s stock will also slightly improve as Biden is expected to be comparatively milder in terms of his China’s policies as compared to Trump. 

While Singapore shares should be cheering for Biden, but guess even with his victory, I reckon that STI will not be climbing too drastically, as Singapore’s economy is more dependent on the Covid situation rather the electoral result. 

I own Singapore stocks, as this is still my home, and I am hoping for a recovery, and that one day in the future, Covid will just be an episode written in our history books. 

In the short term, either Trump or Biden's victory is going to give rise to volatility in the stock market, especially that Covid situation is worsening in the west. But in the long term, I think the impact of the Presidential results will have limited impact over the stock market, than the actual performance of the stock itself. 

I also believe that an impending stimulus after the election is inevitable for the next US President, due to the dire states of the real US economy. Therefore precious metals (gold and silver) as a Hedge is definitely necessary.