Sunday, October 14, 2007

Article on CLuster Houses - I live in one!

I was asked for my comments by a Sunday times reporter on cluster housing concept as I transacted several and also because I live in one. A 30 minute conversation was reduced to one sentence! But all the salient points are there though I should add the following points:

1. Although cluster houses usually attracts families with youngish children, cluster homes could be too small for families with older children (e.g. tennagers) whose need for physical space are greater.

2. I would not recommend cluster homes of less than 15 units, as residents tend to be shortchanged in terms of common facilites like the swimming pool ( which are a key part of the attraction of cluster homes in the first place).

3. Be a little wary that it is in completely in the developer's interests to maximise the number of cluster houses in any given land plot. Newer cluster developments tend to be small, with less land area for common amenities (contrast Gilstead Brooks with Barker Terraces, both by the same develolper, but the latter being later, feels more cramped). Disclosure: I live at Gilstead Brooks.

4. In the same vein, scrutinise the represented floor area carefully. Check if the aircon compressor area (usually on the roof), car park space, double volume voids, are counted as part of the built-up area (usually they are). A really shameful example of floor space misrepresentation is Glentrees, whose 3600 square feet townhouse unit seems like a lot, but not after you take into account the double volume living room (they actually count the square footage of an imaginary floor above your living room when there is actually a void, as part of the quoted square footage), and the car parking spaces.

But I digress. Here's the article.


Cluster Lustre

Source : The Sunday Times, Oct 14, 2007

Who says Singaporeans are an introverted bunch? They are snapping up cluster properties which offer good ol' kampung-style living

INSTEAD of a phone call or a knock on the door, 11-year-old Cornelius Lee says hello to his neighbours with five loud claps. Within seconds, the pitter-patter of hands in a similar rhythm resounds through a Mediterranean-style courtyard that provides a centrepiece for a grouping of terrace houses.

Welcome to cluster housing living - the modern-day kampung, or village, where neighbours who live in individual landed dwellings share facilities and their lives.

Cornelius, his elder brother and his parents live in Kew Residencia in the East Coast. It is one of Singapore's early cluster housing developments, having been launched in 1996.

Cluster housing refers to uniformly designed, landed properties that are built in clusters within a gated estate.

Inhabitants get to enjoy the perks of condominium-style facilities like security, a swimming pool and gymnasium, as well as private basement parking.

According to real estate company Colliers International, 20 cluster housing projects have been launched so far this year, the latest being The Ambience at Punggol by developer DB2.

Inspired by old kampung communities where people 'enter a community before their own house', architect Andrew Tan of ATA Architects submitted the idea in 1991 to a contest by the Ministry of National Development seeking new housing designs.

His design of groups of houses surrounding a courtyard, which is in turn connected to a main courtyard, won top honours but was never built.

The public, too, initially took a while to latch on to the idea.

Ms Tay Huey Ying, director of research and consultancy at Colliers International, says early developments such as the 20-unit Northshore Bungalows in Punggol built in 1995 took over two years to sell. Prices were between $3.1 million and $3.7 million for a house of about 4,000 sq ft.

Meanwhile, Kew Residencia took 11/2 years to sell 25 of its 37 units at an average of $980,000 each, says Ms Tay.

She adds that it is difficult to compare prices of the cluster developments with that of existing landed or condominium projects then because they were an entirely new market.

But four years later, people were cosying up to clusters.

D'Manor in Tanah Merah and Horizon Garden in Ang Mo Kio - launched around 1999 at prices ranging from $880,000 to $1.5 million - hit headlines for being snapped up within two weeks.

Mr Tan says the initial apprehension in the early 1990s was probably due to worries about forking out large sums for a house for which you still had to share communal space.

'Then, terrace housing was still widely available and people probably thought if they had to pay over $1 million for a house, why should they share,' he says.


New generation

BUYERS of cluster homes - regulatory guidelines state they must be Singaporean or seek permission from the Government to buy if they aren't - have changed their tune amid soaring property prices and an increasingly scarce amount of available land.

Knight Frank realty adviser Eddie Koh says Singaporeans tend to buy cluster houses in prime areas, such as the 163-unit Hillcrest Villa in Dunearn Road, for investment.

A check with home owners show that those eyeing projects outside the central region tend to be looking for a roof over their heads.

At Horizon Garden in Ang Mo Kio, the mix between local and expat residents is currently about 50:50, says resident Eleanor Foong, who is in her 40s.

Under the Urban Redevelopment Authority's ruling, expats can only be tenants, not owners, of cluster houses.

Meanwhile, at Gardens At Gerald, a 25-unit cluster housing project in Seletar Hills completed in January, resident Roger Tan, 36, says all his neighbours are Singaporean.

And contrary to the notion that Singaporeans are a conservative, introverted lot, all seven families LifeStyle spoke to say they enjoy the community-centric living that cluster housing provides.

All are fairly young couples in their 30s and early 40s with young children, which Ms Tay says is the pattern among such home owners.

In May, for example, Mr Tan invited the five other families who had moved into his estate at that point to his house to celebrate his daughter's sixth birthday.

At Kew Residencia, it is common for residents to have dinners and wine-drinking sessions or go bowling together.

'It's really like a modern-day kampung,' says Kew Residencia resident Bernard Teo, who is in his 40s.

'You have to be open to the idea of mixing with your neighbours if you are moving into a cluster house. If not, you'll stick out like a sore thumb.'


Best of both worlds

UNDER URA guidelines, a strata title arrangement is used to mark public and private space within cluster housing. The strata title ensures that individual homeowners have rights not only to their own unit, but also communal facilities.

Simply put, it is a marriage of condo- style facilities with the luxury of staying in a landed house.

Gardens At Gerald resident Roger Tan points out that children can run about more freely because of the availability of security.

At the same time, unlike condominium living, where parking can be quite far from your apartment, cluster housing allows residents to 'park your car, walk and you're inside (your home)', says Mr Olivier Honore, 40.

He lives in the Sixth Avenue cluster housing project The Teneriffe. 'Cluster housing is really designed for the people,' he says.

Prices of cluster homes have shot up with the boom - Hillcrest Villa, for example, went for $870 psf at its launch last month in comparison to the nearby Teneriffe, which was launched at $410 psf in 2000. But industry experts and buyers say the cluster is still good bang for your buck.

Mr Malek Ali, who was a real estate consultant for two years until he switched careers recently, says cluster houses are usually between 10 and 15 per cent cheaper than condos.

'Developers tend to give a bit of a discount when they take into consideration that spaces in cluster houses such as the carpark are actually unusable space,' says Mr Ali, who lives in a cluster development in Gilstead Road.

Knight Frank realty adviser Eddie Koh agrees.

'A condominium in the vicinity of Hillcrest Villa would probably cost $1,000 psf,' he says. 'And, these days, you'll never find a condo as big or with five rooms as you would in a cluster house.'

Investors, too, are increasingly game to put their money into the once-alien market.

In fact both Mr Koh and Ms Audrey Wong, an agent with JC Properties (Singapore), say all the Singaporeans they have dealt with bought their cluster homes to reap rental yields.

Cluster housing is popular among the expatriate community because of the quality of life it provides and can fetch monthly rentals of between $10,000 and $13,000, Ms Wong says. 'Especially when it's in a location close to international schools and amenities.'

A retiree who wants to be known only as Mr Fong is one such investor.

'Many of these properties tend to be leasehold projects that would eventually be returned to the Government. It thus makes sense to invest instead of stay in them, especially when they give fairly good returns,' says Mr Fong, who rents out three cluster houses he owns in the expat-friendly Bukit Timah area.


Too close for comfort

BUT cluster housing is not all kampung glam. Mr Tan says some developments take integrated living too far by incorporating too many elements onto the land.

'I had seen so many before Gardens At Gerald that were very cramped and lacked exclusivity, which defeated the purpose of upgrading from a flat,' he says.

And not everyone fits in with the friendly vibe of the tribe.

'As much as we have good neighbours, we also have very strange ones,' says Ms Joyce Lim, who lives in Kew Residencia, but declines to divulge more.

However, if and when your neighbours get too in your face, you just have to go inside, says The Teneriffe's Mr Honore.

'Just like in a college dorm.'


Post-script - a previous, less informative article on cluster houses can be found here.

Saturday, October 13, 2007

Putting my money where my mouth is

I have been asked by friends and clients whether it is a good time to get into Singapore property after the steep price rises of the last 18 months.

My answer is that though Singapore has experienced a doubling of property values in the last 18 months, I expect Singapore property prices now to maintain a steady 10% to 15% increase in prices for the next 5 years. There could be a breather to this growth rate in 2009 or 2010 where there could be a larger than usual increase of properties on the market (put up by speculative but not creditworthy deferred payment buyers) but on the whole, this should be absorbed by genuine buyers. (Just don't be crazy and buy those designer condos with designer prices!).

Today, I put my money where my mouth is (again!). I made a downpayment for a yet-to-be-built townhouse in the foothills of Mount Faber. At least my friends and acquantances can't accuse me of not following my own advice...

Saturday, June 30, 2007

Selling Options? Beware!

This was sent to me my Leon Koh, a very helpful realtor:

" Btw please be careful when selling options:

Case study
After seller sells the property to buyer A, buyer A decide to resell the option to buyer B.

Buyer B will wait for the last day of the option, before exercising the option and paying buyer A the different in price VIA CHEQUE.

However, the cheque bounced the next day!

At this time, the buyer B has exercised the option to his name and buyer A has no legal documents to claim back that resell profit Please be aware! "

Foreigners to be allowed to buy landed property in Singapore?


Goldman Sachs have caused ripples in the Singapore community by recommending that Singapore do away with restrictions on landed property ownership by foreigners. There was an almost instant rebuttal by the Minsitry of Law (err, why are land issues handled by the Ministry of Law anyway), and indignation in the forum pages of The Straits Times are starting to come in.

My take? Lift restrictions for foreigners to own cluster landed property. Cluster landed property are more akin to condominums than pure stand-alone landed property. They are space efficient (they have relatively small floor foot prints but usually built to 4 levels) and like condominiums, they share common facilities like a communal swimming pool, gym, children's play area (and related quarterly maintenance charges)

Indeed today we do have anomalies in the system where certain cluster house developments are considered to be landed property (where restrictions on purchase by foreigners apply) whereas others in mixed developments (i.e. those whch also have apartments in the same development e.g. Glentrees, Somerville Park) are considered not to be landed property. Physically though, the "landed" townhouses in these two types of development are indistinguishable.

Allowing foreigners to buy space efficient landed property such as cluster homes will not have a major impact on land scarce Singapore, but yet give a greater choice of homes for foreigners who are attracted to Singapore to live or invest in.

Disclosure - I do own a cluster landed property in Singapore and would stand to gain if restrictions on foreign purchase were lifted.

Monday, June 25, 2007

Penny Wise, Pound Foolish

Just a major bug bear about real estate agents:

1. Why do some real estate agents subscribe for caller ID barring (this means that when you receive a call from such a real estate agent, your mobile phone will not have a record of the caller's phone number). I would have thought that in this business, you would like to people to return your enquiries about properties. Instead, one's caller list has "No Caller ID", and there is then no way of returning the call.

2. Why do the rest prefer to call from fixed line phones, and almost always, hunting lines at that? Sure, we can return calls to fixed line phones, but if the estate agent rings from the company phone, you just get a "aaah - who did you want to speak to aaah"; "##$%!!! I don't know, I was just returning a missed call"; "aaaahh. wat's your name aaah?"; "Malek"; "AAAAAAH, ANYONE HERE CALLED MALEK AAH? AAAH? (then back to the phone) "Sorry aaah, no one here called you aaah, nevermind, nevermind, the person will call you again aaah, ok aah, byee aah"

Sure, fixed line calls are cheaper but for the extra $200 per month, you would get a lot more of your calls returned (and more chances of closing the deal that will pay for that month's phone bill 100 times over)

Tip #1 for real-estate agents : If you call from a mobile phone and allow your caller ID to be displayed to the other party, then you dramatically increase your chances of getting a return call or a return SMS, leading to higher chances of closing a deal.
"

Saturday, June 9, 2007

The What and the Why

So this is the fourth blog site (first being the joys of fatherhood, second the mobile business (mobilitee@blogspot.com), and third, commentary on Malaysian and Singapore politics and society)

Yes. I've moonlighted as a real estate agent in Singapore for more than a year now. Initially it was more for keeping myself busy whilst waiting for an entrepreneurial project to get regulatory approval, but now it is actually paying the bills.

But even today, I feel it hard to admit to anyone that I AM a real estate agent. It's one of those jobs (I wouldn't call it a profession yet, as future posts in this blog will indicate why) where one hesitates to admit to in a party, alongside psychiatrists, accountants and used car salesmen. Mention the word estate agent in this country (Singapore) and images of pushy aunties, young men with slick gelled hair, and dodgy/evasive/non-committal characters come to mind.

But that's where this blog comes in - to explain why real estate agents in Singapore evoke those images. And believe me, the impressions are justified...