2022 will be my 7th year writing for Second Property Investors.

So sometimes, I don’t remember every single thing I wrote in the past.

Earlier this month, someone forwarded me my old article which I wrote way back in December 2017 – about how important it was to understand the property supply charts that URA releases.

He mentioned that if he knew about the article earlier, he would have bought a property back then.

I can’t help but look back at what I have written about the property supply in Singapore.

During that period, I still remember how everyone around me was telling me that the property market was in oversupply and the prices will crash soon.

In August 2019, I wrote another article about how the sentiment about oversupply seemed to be very strong.

News headlines were screaming that there was 24,000 empty homes in Singapore. 

So I analyzed the URA quarterly reports and mentioned that by 2020 and 2021 – the property supply would become low.

In the same article, I also touched about the high number of unsold units.

I shared that some developers were selling at very close to their breakeven price.

And I mentioned that was the time we can take advantage and buy property from them – because they will slowly but surely increase the price moving forward.

In the Aug 2019 article, I used Treasure at Tampines as an example of a development selling at near $1200 psf.

Of course, I did not expect the pandemic that happened later in March 2020.

The property supply which I anticipated to be low in 2020 and 2021 – it just meant that the situation became more worse.

The WFH trend also did not help with the supply situation. In fact, it just pushed up the demand for bigger homes.

People were getting tired of their small homes and wanted an upgrade to a larger one.

With the combination of low supply and high demand – it is no wonder that property prices went up so high that cooling measures had to be implemented in December 2021.

Hindsight Is Always 20/20 Vision

In 2019, I met a lot of readers who were planning to upgrade to private property.

Because of the fact that the developer was selling Treasure at Tampines at close to the breakeven price of $1200 PSF, I felt comfortable to recommend this development as a suitable option for their next property purchase.

Why do we want to buy close to breakeven prices?

In the event the developer’s sales were slow – this would mean it is highly unlikely that would drop their prices further.

So purchasing a unit at Treasure at Tampines at near $1280psf meant that the risk of overpaying is reduced.

In 2019, I had quite a number of clients who listened to my advice and took up my recommendation of purchasing a unit at Treasure at Tampines.

Those transactions I highlighted in yellow are not the exact units my clients bought – but the prices are very close to what my clients bought.

Today in 2022 – when I scan the latest transactions – I can see prices are now as high as $1700psf for a big unit.

I am not here to show off that I am getting things correct.

But rather that making money with private property is still possible in Singapore.

As a property agent, it is very common for many people to see me as just a salesman.

And it is true. I do make money from commissions.

In fact, in 2019 – I was one of the top salespersons for this development and even got a trophy for it.

This trophy was only possible through the support of my readers who became clients – who entrusted me with their property portfolio. Thank you.

But more importantly, I appreciate the trust that my clients had in me when they decide to take up my advice.

I remember that year as where I was convinced that Treasure at Tampines was a good choice because of the price point it was launched at.

But imagine during that period – there were so many units available and sales were slow.

Some were looking around the quiet showflat and were unsure whether it was a good idea to proceed to buy.

That’s our human nature – we take our cue from our surroundings and the behavior of others.

So I like to acknowledge my clients who overcame their own doubts and trusted me enough to guide them in the biggest purchase of their lives.

(For this particular development in the whatsapp screenshot above – where the price increased by $300K in 2 years – it refers to another development that is NOT Treasure at Tampines.)

People never notice the small decisions – only the final results

Sometimes when we look at other people making good returns on their investments, we only see their success.

From the outside, people can only see our success and the final results.

But rarely do they see the analysis and small decisions made behind the scenes.

There are turning points that could have taken us in a completely different direction.

Some would have considered the prices in 2018-2019 as way too high.

But now, most who bought in the 2018-2019 period are now sitting on nice gains.

They bought in a period when there was an oversupply and when nobody was buying.

And when the supply steadily goes down, it makes perfect sense for the developer to increase prices.

Will Lentor Be Seen As Expensive?

I never imagined that developers would be willing to pay $1204 psf ppr for a plot of land in Lentor in July 2021.

But it happened. This land will be developed for a mixed-use development.

When the supply is low, the developers have to fight for land and this pushes up for land prices to be higher.

Compare this to how much developers paid for a similar mixed-use development land plot at Woodleigh Residences.

It was sold at a cheaper price of $1181 PSF PPR back in 2017.

Imagine this – buying a unit at Lentor is now more expensive than buying a unit at Woodleigh Residences.

Perhaps due to this record high price being held by this Lentor Central site, does this mean that developers will have to sell their units at near-breakeven price again?

Will the cycle of what happened at Treasure at Tampines (previously Tampines Court) repeat itself for Lentor?

I don’t know. But I will be watching this closely.

Conclusion

The cooling measures has been around in Singapore for more than 10 years. At this stage, it is very likely it will continue to stay on and perhaps even become more restrictive.

All these is done to make sure that buyers are not overleveraged and have a wide margin of safety.

There are still opportunities available in the Singapore property market – it is just that it is only available for those who are willing to explore and take action.

Developers are now replenishing their land bank.

Currently, the prices have shifted to another level.

• Sim Lian won the bid – by being willing to pay $980 psf ppr for a plot of land at Dairy Farm in March 2022.
• Hong Leong won the bid – by being willing to pay $1060 psf ppr for a plot of land at Lentor in Jan 2022.
• CDL won the bid – by being willing to pay $1302 psf ppr for a plot of land at Jalan Tembusu in Jan 2022.

And all these results came in the wake of cooling measures that was applied on 16 December 2021.

The question is – can we catch up with this tide of rising prices?

Sometimes change will happen too fast for us to handle.

Check out my latest case studies of clients whom I’ve helped in the last 2 years.

If you are looking for a guiding hand to explore your own choices in the Singapore property market – I invite you to contact me for a no-obligation discussion.