Brexit would be catalyst for a better Britain, claims Hargreaves Lansdown founder

Peter Hargreaves is co-founder of Hargreaves Lansdown, one of UK's largest financial services business.  He has come out to say that Britain leaving the EU would be better for Britain.  Notably, he is one of the minority business people who have taken the position.

And it must certainly be a great compliment to Singapore when he also said,

"When Singapore became independent from Malaysia, that little insecurity that they were no longer part of Malaysia, it was an inspiration. I honestly think that would be good for us too."

Singapore must be one of the few, if not the only, ex-colony that its colonial master turns to for inspiration!

http://www.telegraph.co.uk/business/2016/03/18/brexit-would-be-catalyst-for-a-better-britain-claims-hargreaves/

Majulah Singapura!

Here is how far Singapore has become.  Check out our fireworks display at the Marina Bay to usher in 2016.


And here is our mobile column during the Singapore National Day Parade. SG50! From AMX-13 to Leopard Tanks.

Thanks for watching!

Singapore tops the list of the most expensive city in the world once again

Singapore tops the list of the most expensive city in the world once again, a new survey comparing the cost of living in 133 cities reveals.

Nudging just behind Singapore is Paris, followed by Oslo, Zurich and Sydney. London is the world's eleventh most expensive city, The Economists' Intelligence Unit report says. 

London is now as expensive as Tokyo, which was replaced by Singapore as the most expensive city last year.

Cities in Pakistan and India, including Karachi, Bangalore and Mumbai make up four out of the top five cheapest cities to live in last year.

The world's top five most expensive cities remain unchanged for the second year in a row, the report reveals.

The EIU's survey comprises 133 cities worldwide and uses New York as a base. It compares the cost of more than 160 services and products including food, clothing and utility bills. 

Jon Copestake of the EIU said: 'The situation of an unchanged top five is very rare for the worldwide cost of living survey and disguises some significant global drivers that are impacting on the cost of living everywhere. 

Read more: http://www.thisismoney.co.uk/money/news/article-2977215/World-s-expensive-cities-revealed-Singapore-tops-charts-again.html#ixzz3Tbx3SyT3
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Singapore - More Private Properties Sold at a Loss

More private properties sold at a loss!

The chart below shows significant losses.

Thanks for reading!

Vacancy for Private Homes at 10 year high

Vacancy rates for private homes at a 10 year high - Straits Times 24 Jan 2015.

Rents under pressure.

24,062 - the number of vacant completed residential units at the end of the 4th quarter of 2014, nearly 2,500 units more than in the quarter before.

19,941 - the number of private residential units that were completed last year, up 52% from 13,150 in 2013.

3% - the full year drop in rents last year, marking a reversal from the rise in rents in the preceding four years

8% - the expected maximum fall in rents this year, with the most pronounced drop in the central region as firms cut back on housing allowances.

Housing and Development Board - The Promise

A video produced by the Singapore's Housing and Development Board or HDB.  The HDB is responsible for public housing in Singapore.  Very touching video.  There is a lot of meaning to the word, home.



Thanks for watching.

Rents Set to Fall with Glut of New Condos - Singapore

Rents set to fall with flood of new condos.  In this ST article,

1. It is fast turning into a tenant's market, with a glut of new condos completing soon.

2. In the past year alone, about 16,000 non-landed private homes were completed, URA figures.

3. 25,000 new units expected to be completed between this quarter and end of next year, with more than half in the suburbs.

4. Numbers point to potential glut in the vicinity of Dairy Farm and Hillview Avenue.

Thanks for reading.

Singapore Property Correction Not There Yet - DPM Tharman

Property prices in Singapore have not seen a "meaningful correction" yet, said DPM Tharman.
"If we do not get a meaningful reversal after each upswing, property prices will run ahead of the growth of household incomes over the long-term."

From the tone of this interview, I think the Government is signaling clearly that the cooling measures like ABSD will be here to stay for now.

Thanks for reading.

Singapore Ranks 31st in the World for Livability, even behind Kuala Lumpur - MORI

The Global Power City Index, published by the Mori Memoral Foundation, is a fascinating piece of work.  London was rated the top city, by quite a wide margin.  New York was in second place and Singapore was in fifth place - not bad for our little island state.

However, a closer look at the methodology and detailed rankings within the sub-categories reveal a very interesting picture.  The focus of this post is to point out that Singapore does not fare well in the 'Resident' category, or the category for livability, coming in at 31st.

Take a look at this chart for the ranking method used by the survey.  In short, they split into 6 sub-categories, namely Economy, Research and Development, Cultural Interaction, Livability, Environment and Accessibility.

They create five types of people, namely 'Manager', 'Researcher', 'Artist', 'Visitor' and 'Resident'. These five types are assumed to have certain demands with regard to what they want.  For example,  a Resident would want good access to products, ease of living, good education, leisure, public safety and quality of medical treatment.

These are the detailed scores from the six categories. Let's take a look at where Singapore stand.

Singapore's Ranking 
Economy - 6th
R&D - 8th
Cultural Interaction - 4th
Livability - 37th
Environment - 5th
Accessibility - 8th
Overall - Singapore was ranked 5th.

Why did Singapore do so poorly in Livability?
I think that this is an important question that the country should consider.  It is worthwhile to note that the top 2 global cities also did not fare well here.  London was ranked 21st and New York ranked 29th.   However, Paris was ranked 3rd in this category.

Singapore is a Small City State 
Unlike the cities of London and New York, Singapore has no hinterland.  We are a small city state. Therefore, it is even more urgent for Singapore to pay attention to the 'Livability' element because it impacts Singaporeans on a daily basis.

The challenge for us is whether we can continue to maintain our strength in the Economy and other categories, while drastically improve our Livability score.  Tokyo is also a very dense and crowded city, yet she is ranked significantly higher than Singapore, at 17 instead of 37.  Even Shanghai is ranked at 19.

Happy reading.

Debt Crunch for Property Industry - Singapore

Some significant points to note as follows.

1.  The 80 property companies on the SGX reported a combined $23.5bn of short-term borrowings that have to be repaid in a year, according to data compiled by Bloomberg. 

2. Looming debt as vacancy in condos hit highest since 2006, according to URA data.

3. Population growth is at 10-year low.  Developers of residential homes suffering from 'collapsed' sales volumes. 

4. Number of residential units being constructed remains very high; 65,270 units in the pipeline as of 30 June 2014, according to URA data. 

So, where is the Singapore property market headed?  I think downwards.

Looking at the macro picture of supply and demand, I don't see how it is possible that property prices in Singapore can keep going up.  In fact, I think it will come down, but the question is how much would it fall.

This is one of the reasons why we have not invested into the Singapore market, at least not yet.  I have heard stories from friends that they are increasingly finding it hard to rent out their investment units, even after they have lowered the prices.

So far, we have had zero void in our London properties, for the past 5 years.

Happy investing!

HM The Queen receives Her Excellency Ms Foo Chi Hsia, Singapore's High Commissioner to UK

Her Excellency Ms Foo Chi Hsia is received in audience by The Queen and presents the Letters of Recall of her predecessor and her own Letters of Commission as High Commissioner for the Republic of Singapore at Buckingham Palace, 8 October 2014.

Ms Foo Chi Hsia, a career diplomat with the Singapore Foreign Service, was dressed immaculately in a Peranakan Nonya Kebaya outfit, together with matching shoes.

This is the link to the British Monarchy Facebook page.

Congratulations Chi Hsia!

Settling Commercial Disputes in Singapore

Way to go, Singapore. Steal a March on London. Singapore, being a very small island republic, would need to capitalize on her strengths. This is one fine way to do it.

What struck me was that most of the commercial dispute action is now in Asia.

Why should we let global cities like London and New York steal all the commercial arbitration and dispute settlement business? Let this piece of work be done in Asia.

Singapore is a good bet.  Come, come.

Singapore National Day Reception in London 2014

National Day Reception in London - Sep 2014.  This was organized by the Overseas Singapore Unit (OSU).  Thanks for the invite! It was a standing event held at a hotel in central london, near High Street Kensington tube station. Looking around, there were approximately 300 guests, mostly Singaporeans.

Singing the national anthem - Majulah Singapura


The Singapore High Commissioner to London, a nice lady, addressing the event.

Some performances by Singaporean talent, before the dinner started.

This young lady sang pretty well, with an accent.  I can't remember her name though.

This lady sang soprano.  Quite exotic.

Dinner starts.  This was the laksa station.  Pretty authentic.

Chicken laksa.

This was my portion.  Good taste.

Oh yes, the event was held at The Royal Garden Hotel.  This was the table for the main course.

Quite messy, but in there was some chicken rice, char kway teow and other local delicacies.

The National Day cake, quite popular so it seems.  I didn't like the cake though.

The dessert section.  Hot dessert was Bo Bo-Cha Cha, which was pretty good.

The cold dessert was fantastic - Ice Kachang! The servers would give you a bowl of crushed ice and you help yourself to the various condiments.  Very yummy.

This was my dessert - Ice Kachang in London.

Oh, more cake rolled out!

Another look at the hot food selection.  The food ran out quite quickly.

Another look at my dessert.

Singaporeans mingling around, catching up.

It was a very pleasant evening and I certainly caught up with a few friends.

Safe travels!

Majulah Singapura!

Formula 1 and SIA tie-up

Good show.

Tie-up for success.

I think the two brands go along very well.  This will be a great partnership.

More Than Half The World Now Lives In Cities

This is according to a report recently released by the United Nations.

Managing urban areas has become one of the most important development challenges of the 21st century.

The report notes that in 1990, there were ten “mega-cities” with 10 million inhabitants or more, which were home to 153 million people or slightly less than seven per cent of the global urban population at that time.

In 2014, there are 28 mega-cities worldwide, home to 453 million people or about 12 percent of the world’s urban dwellers. Of today’s 28 mega-cities, sixteen are located in Asia, four in Latin America, three each in Africa and Europe, and two in Northern America.

Today
Tokyo remains the world’s largest city with 38 million inhabitants, followed by Delhi with 25 million, Shanghai with 23 million, and Mexico City, Mumbai and São Paulo, each with around 21 million inhabitants. Osaka has just over 20 million, followed by Beijing with slightly less than 20 million. The New York-Newark area and Cairo complete the top ten most populous urban areas with around 18.5 million inhabitants each.
By 2030, the world is projected to have 41 mega-cities with 10 million inhabitants or more.

Tokyo will still be largest city in 2030

2030 Projections
Although Tokyo’s population is projected to decline, it will remain the world’s largest city in 2030 with 37 million inhabitants, followed closely by Delhi, whose population is projected to rise swiftly to 36 million in 2030. While Osaka and New York-Newark were the world’s second and third largest urban areas in 1990, by 2030 they are projected to fall in rank to the 13th and 14th positions, respectively, as mega-cities in developing countries become more prominent.

By 2050, the vast majority of the world’s megacities will be in Asia.

What about Singapore? 
Well, we should think about the future of Singapore.  When the Government put out that infamous White Paper of 6million population, the local people screamed and yelled.  But just look at the world around us. Mega-cities are growing rapidly and many more big cities are coming online.

Do we need to become a mega-city as well?  Is there some magic in the 10 million number that gives a mega-city its edge?   The current top global cities in the world like New York and London are also very large.

Since Singapore is such a great place to be in, maybe we should just ramp up infrastructure in a huge way and hope that more people will come here to work and play.

Do not forget that in this world of 7, 8 or 9 billion people as well as many large, huge and mega-cities, even staying relevant would become a challenge to our little red dot.

Happy Investing!

Rent too damn high, move to Singapore (New York Times)

From the New York Times by Shaila Dewan (April 29, 2014)

Anyone in the market for a luxury apartment in Hong Kong, London or Washington toward the end of last year was in luck. The rents on prime flats were sagging a bit. Billionaires could lock in leases on pieds-à-terre at a slight discount. You might suppose that those savings would trickle down to regular working Joes, but no — middle-market rents in those cities continued their apparently inexorable upward march.

The developed world’s wealthiest cities are facing housing crises so acute that not only low-income workers, but also the middle and creative classes, find them increasingly difficult places to afford. Redfin, the real estate website, recently found that there was not a single home on the market in San Francisco that would be affordable on a teacher’s salary. And that was just for buyers; in many cities, renting is even more expensive.

The rules of the market say that in this situation, people should simply opt to live someplace cheaper. But in today’s economy, that’s not so simple. Detroit has very cheap housing, but unfortunately, all of it is in Detroit. Alternately, more desirable cities could build more housing to satisfy demand, but new developments don’t tend to have that effect.

Luxury towers are sprouting up, adding density to unlikely places, from the Brooklyn waterfront to San Francisco’s Mid-Market district. But adding inventory to the high end does nothing to help the middle — one of the many irritating peculiarities of the 21st-century boomtown housing market. Building new apartments can actually push rents higher, and amenities for the masses, like transportation and parks, may have the effect of pricing them out. Everyone wants to live in these places, so no one can afford to. What’s a global city to do?

There is one city that has managed to surmount this problem. The achievement of near-universal affordable housing in a place with limited land mass might be a beacon of hope, were it not for the fact that it is Singapore, a sovereign city-state with one-party rule, wonky leaders, an economy that has grown rapidly in the last half-century and one of the highest per-capita incomes on earth. There, more than 80 percent of the population lives in public housing designed with walkability, ethnic diversity and green space in mind.

The Singapore solution required drastic action of a sort that most other places could not countenance: In the early 1960s, the government started building big, uniform apartment buildings, then pushed workers to move out of overcrowded shophouses and huts. Some herded their livestock along to their new flats. And at first, many residents were afraid of the higher floors.

Today, cities that want to actually solve their housing problems will have to stomach similar forms of psychic dislocation, not necessarily for those being housed, but for those with strong ideas about what their city should look and feel like. Many of the things that we cherish most about urban living are the very things that make housing more expensive. San Francisco, certainly one of the world’s loveliest cities, has restrictions that keep much of residential construction under 40 feet. And even in New York, no stranger to height, the high-rises to be built on the site of the old Domino Sugar refinery in Williamsburg have prompted teeth-gnashing from the guardians of the “urban fabric.”

New York’s new mayor, Bill de Blasio, who promised, on the campaign trail, to build more than 100,000 affordable apartments, seems to have an inkling of what will be required. “It’s going to take a willingness to use height and density to the maximum feasible extent,” he has said. “I don’t have a hang-up about it.”
But then, lots of people think they know what to do to fix housing: Stick it to the landlord with rent controls. Require developers to set aside low-cost units. Build more subsidized housing. Distribute more rent vouchers or, as San Francisco has recently done, funnel taxes and fees into a housing trust fund. For those with more faith in market forces, there is always the loosening of zoning regulations, in imitation of sprawling Houston — which is indisputably cheap, so long as you don’t factor in the cost of driving.

Yet many of these solutions are dwarfed by the sheer size of the problem. London alone needs, by one count, 800,000 new units by 2021 to meet both pent-up and new demand. Sydney, where the median rent on a two-bedroom apartment is now $2,600 a month, aspires to build more than half a million units by 2031, a goal for which it would have to double its normal pace of construction. New York needs more than 300,000 units by 2030. By contrast, inclusionary zoning, a celebrated policy solution that requires developers to set aside units for working and low-income families, has created a measly 2,800 affordable apartments in New York since 2005. It’s not clear we have the fortitude to deal with these shortages head-on.

But unshackling the private sector may not be a complete solution, either. Many housing advocates, even conservative ones, insist that the free market will never provide housing that low-income families can afford, because apartments are simply too expensive to build nowadays. Some form of subsidy is needed, they say.
But the size of a subsidy that actually covered the demand would be immense. The Bipartisan Policy Center in Washington figured out that giving all low-income families vouchers large enough to make their rents affordable would require federal rent supports, now at $62 billion a year, to more than double.

Of course, rents don’t always go up. Even San Francisco’s rents fell off a cliff after the dot-com bust last decade. But increasingly, there are economic forces at work that seem to move in only one direction: More people are moving to cities, and wealth is distributed more unequally. Apartments have become a global commodity, a safe investment for the well heeled, no matter where they actually live. Todd Sinai, a Wharton economist, says that just as cities have always had fashionable neighborhoods where only wealthy people can afford to live, now some “superstar cities” have become just like those places, the affluent districts of the globe. When housing is worth so much on the open market, it becomes harder to hold some of it back for regular workers. And eventually, Sinai says, the rich could find themselves displaced as well — by those who are even richer.
-------------------

Some food for thought:

1) From the supply side of the equation, looks like Singapore has ample supply of housing!  So, where are property prices headed?

2) Singapore leads the world in solving our housing problem.  I ever read that HDB has won United Nations Public Service Award for public housing achievements.

3) Article recognizes Singapore for being green.  In fact, we are the greenest city on Earth (in terms of green spaces), according to one survey commissioned by the Mayor of London. 

4) London needs so many units to even meet pent-up demand.  

5) High prices of many things in Singapore.  Is it because of land prices?  I don't know.  But here are some reflections as I sat in Cafe Rosh in London last year. 

6) Did you know that Fine Dining is less expensive in London than in Singapore?  Check out this blog post.

Do share your thoughts on this issue at my community forum thread here.

Happy investing!

Singapore Property Prices Coming Down?

According to this article "Private home prices fall in all districts" (Straits Times 26 April 2014), prices have come down 1.3% in 2014 Q1.  Private home prices fell across the island, the first time in nearly 5 years, with the biggest drop in the city fringe (areas like Bishan & Queenstown).

Glut of Unsold Units
Out of total supply of 80,261 private homes under construction at the end of March, slightly more than 1/3 or 29,482, were still unsold.   This 80,261 number excludes the Executive Condos. After adding the supply of 13,691 EC units in the pipeline, the total number is 93,952 units in the pipeline.  Further, another 11,042 units would soon be added to the pipeline.  This brings the total to 105,000 EC plus private units in the pipeline.  All these exclude HDB.

Also note that Minister Khaw Boon Wan has blogged about ECs.  He said that the take-up rate for ECs has been high and supply has been ramped up to meet demand.  He will continue to ensure that EC scheme stay on track.

The above statistics are from the URA Release of 1st Quarter 2014 real estate statistics - the press release can be found here. (dated 25 April 2014, worth a read)

City fringe was hard hit because developers were offering sweeteners and discounts to move units.

A closer look at the chart - which way is it headed?

Some More Charts from URA Press Release

Residential Price Index by Type - since 1997 Q1 (4Q 98 = 100)

Property Price Index by Type of Property since 1997 Q1 - (4Q 98 = 100)

House Hunting
As shared in my About Us page, we currently live in HDB and we do not own any other property in Singapore.  Looking at our investment portfolio, we are aware that we are under-invested in Singapore. But, is this the correct time to buy?

We have visited a couple of units in recent weeks.  Just today, we visited a few condominiums.

For instance, we saw a couple of units at Southhaven II, a freehold condo, at Hindehe Walk, very near Bukit Timah hill.   The place was pleasant and well kept, however, asking prices were $1.7Mil for a 1,800 sq feet unit unit and $1.6Mil for a 1,600 unit.

Well, we are not prepared to pay these prices.  Maintenance charges were $360/month and we were told that those units could rent out for about $4,000.  The estate agent told us that 40% to 50% of the units were rented out.

Well, we don't feel very inspired to move after viewing the units at these prices.  Oh well, that's just us.

Fundamental Demand and Supply Issues 
We see new units sprouting up everywhere.  Government has greatly stepped up HDB supply.  Just within a 500M radius of our HDB flat alone, we have at least 5 X 35-40 storey blocks being built at a breakneck speed, plus another 4 X 35 storey 99-year leasehold development being built.

Tall HDB Towers

Should You Sell Now? 
In my next blog post, I discuss this issue.  So many homes coming up!

There has also been a sharp drop in new home loans.  Check out this recent blog post. 

I found an article by CNBC from Sep 2013 where the analyst (Barclays Bank) predicted that Singapore home prices could be headed for a 20% correction by 2015.  Time will tell.

Channelnewsasia article (27 Apr) on property developers pulling out stops to boost sales.

Research Report by Property Firm HSR - 50 Projects with less than 50% sold.

Happy Investing!!

Important Disclaimer - . The views contained in this blog and blog post are entirely mine. We cannot be made responsible for any investment decisions you may, or may not, take. Nothing in this blog can be construed as professional investment advice, as we are NOT professional investors and we are ill qualified to give you any advice.  Read the blog at YOUR own risk

London comes out joint top in 12 Cities, Savills Research

This recent report by Savills is a fascinating read.   If you are interested in global real estate, it is well worth your 30 minutes to go through the entire report.  The data is very well presented, and very informative.  I definitely enjoyed it.

Definition of Top World City
Savills makes it clear that their definition is not merely based on population and size of GDP, but also less tangible factors such as fame, prominence, international reach and 'investibility'.  They are interested in centres of innovation and human endeavour.  In short, they are looking for the 'X' factor.

Savills concludes that it is often a cosmopolitan nature and international outlook that cities globally investible and prosperous.

Pride in Singapore, our Little Island State
I take one step back and read these rankings with a great sense of pride.  We often take Singapore for granted.   Yes, we have issues to confront, however, what makes us so special that we can be ranked joint 3rd in such a survey?  It is worth pondering over this and not lose track of the big picture.  There are more than 450 cities in the world with population greater than 1 million.   In China alone, more than 160 of such cities exist and I am sure all of them are hungry, and they want to beat Singapore.   We are not alone, and nobody owes us a living.

Key Elements that Make a World City 
Figure 14 of the report sums it up.  In terms of global connectivity, we still lag behind London and New York.  In terms of Prominent (proxied by Google hits), New York is way ahead of the pack, not surprising.  Then again, not sure if Savills counted Baidu hits and that of other search engines in China.

Most Active Real Estate Investment Markets 
Even though Singapore is joint 3rd, in terms of volume, we fall to 13th.  This is not unexpected, given our size.  Even by this measure, New York and London are on top.  Size does matter, somewhat.

Look and Feel of the City
These charts are fascinating.  They compare 4 variables; 1) population, 2) persons per ha, 3) number of buildings over 150M and 4) Density/building height.

Look at number of buildings over 150M. London only has 12 buildings over 150M, versus 293 in Hong Kong, 230 in New York and 69 in Singapore.  This confirms that London is still very low-rise.

Look at persons per ha.  We think Singapore is crowded, but we are just middle of the pack.  Even Hong Kong isn't crowded compared to Tokyo and Mumbai!

Write-up on London
The write-up on London (page 18) has a few noteworthy points.

First, risk averse investors have traditionally focussed on low-yielding Central London properties, but the secondary, high-yielding locations may provide more opportunities.  This is consistent with our investment strategy in London.  We have avoided low yielding properties, e.g. those in Zone 1.

Second, London is expected to be amongst the best performers in the coming years across a number of real estate classes that Savills monitor.  Read more here about buying a new-built in London.  On this page, I look at some properties in London that are both central and also a bit further out.

Write-up on Singapore
Savills thinks that the long-term prospects are a good bet, even though in the short term the Government has imposed substantial restrictions to foreign investors.

Conclusion and Predictions
Savills gives 7 predictions of the future.  Let me quote prediction number 7 in full, because it is a good reminder for all of us.

"It seems likely that the cities exhibiting the highest capital and rental growth over the next five years will lie outside this study.  By 2018, we could be looking at 15 or 20 world cities.  The ones to watch include major metropolises in up and coming economies, which include Istanbul, Hanoi, Kuala Lumpur, Jakarta and Bangkok, plus many large, second-tier cities in the same countries that few in the West have ever heard of."

The world is constantly moving and changing.  A stark reminder that things may not always get better.  Singapore may be third today and that is an incredible achievement.  But if we do not forge ahead, we will definitely be overtaken, and fall far behind.

Happy Investing!