Invest in High Potential Upside properties – Le Quest

In today’s post, Reverse Mortgage City will be sharing with you an important concept on property investing,


“Cheap is never the reason to buy. Value is.”

After reading this post, you will:

  • learn how to measure in dollars, Potential Upside and Risks
  • know the differences between 6 price factors
  • apply the 8 Entry Price Checklist to a Bukit Batok New Launch, Le Quest

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2 Buying Criteria (2BC)

Buying is the first step in creating a wealth accumulation plan in a property. When I buy, I go for properties with high potential upside and the least risk for me. I will not go for something I cannot be certain of, nor will I buy high. So having timely and accurate data is important.

To determine which unit is the right one for my property savings plan, I evaluate each one based on what I call the 2 Buying Criteria (2BC). The 2BC are: (1) Potential Upside and (2) Risks

In order for me to assess potential upside and risks, I need to have an objective, specific and measurable data. The 2 best tools to evaluate potential upside and risks are the price variable and rental yield.

Potential Upside & Price Factors

Previously, we gave you a brief overview of what Potential Upside is about, and here, I am going t to elaborate on the topic. Many people do not fully understand what Potential Upside means. Some people believe statements such as “In 10 years’ time, property prices will increase. So there is a lot of potentials if you buy now.” But what does that really mean? It does not tell us what the Potential Upside is.

To me, Potential Upside has a very precise meaning, It is a current assessment based on price. The concept of price plays an important role in assessing Potential Upside. Price has many components. It could be the asking price or the last transacted price, or the past peak price and so on. When we compare different price components between properties and/or units, we can draw different conclusions. For example, when an agent says the asking price is $500,000, what exactly does this mean? How does $500,000 compare with the asking prices of other units? How does $500,000 compare with the historic peak prices of units in that area? This is a strategy I use so I will have a stronger assessment. singapore property newsPotential Upside can be measured and expressed in dollars. This means that at the point you decide to buy, you have an idea of how much the Potential Upside is expressed in dollars. We can say that a unit has low Potential Upside if its asking price is $1,000 psf and the current transacted prices for units in that project is $700 psf. As a guiding principle, focus your search for properties that are below market price (BMP). 

Risks & Rental Yield

Many people “hope” that their risks are minimised so that they can create wealth through their properties. Well, “hope” is not enough for me. It makes me feel nervous and worried.

Below is a great video indicate how to leverage on rental income to be financially free:

One way to minimise risk is to know what risks you are facing. There are specific ways to minimise risk when you buy properties, and the better way is to be able to measure it in terms of dollars and cents. So look at the numbers. Specifically, you can look at rental income vis-a-vis mortgage payments.

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Rental income potential against mortgage payments is an effective and specific way to measure risk. The main point is to establish whether you have a positive or negative mortgage situation. A positive mortgage situation means the rent you receive covers your mortgage and there is some extra leftover for a positive cash flow situation. A negative mortgage situation is an opposite. It is when the rent you receive is not sufficient to cover your mortgage. When using data, I base the rental income on current rent received by nearby units or projects. 

When calculating the amount of mortgage to be paid, I put down the current rent, and then start adjusting it downwards to assess my risk tolerance. For example, if the current rent is $4,000, I will reduce it to $3000, and work out if at that reduced sum of $3,000, am I still in a positive cash flow situation? To work out my tolerance level for the worst case negative cash flow scenario, I will ask myself: “if I had to top up $500 in cash each month – will that be okay for me?” (And I will keep on adjusting until I find a number that is acceptable to me.)

Exercise: Measuring Risks

William purchased a unit that cost $1,000,000. As a first-time borrower, she was eligible for an 80% loan for 20 years. Her monthly mortgage payments worked out to $4,000 per month. The current rent for the property is $6,000 per month, which is secured for two years. What is her risk?

Purchase Price: $1,000,000

Loan Amount: $800,000

Monthly Mortgage: $4,000

Other charges (e.g. maintenance/conservancy, property taxes): $1,000

Rental income: $6,000 per month

Cash Flow per month: $1,000 per month

Cash Flow per year: $12,000 per year

From the calculations, we can conclude that for the next two years, with a guaranteed rental income of $6,000 per month, her risk will be $0.

To manage risk, I recommend buying based on current information, not information based on the future. It is not difficult to get hold of current rental prices. The Internet, for example, has made it easier to get current information about rental prices. In Singapore, there are many online resources that can provide you with indications of current asking rents.

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Another way is to ask your property agent directly. Among my agents, for instance, we share customised and timely data on current rental and transaction prices. This wealth of information gives us a lot of certainty over how to measure risks. Register interest for Le Quest Condo Today. 

Assessing Property Potential Upside and Risks

In one of the previous post, we have talked about the reverse mortgage.  Let us talk more about assessing the potential upside and the risk associated when it comes to investing in property. We will also recommend a good property investment opportunity for our reader – Hundred Palms Residences at Yio Chu Kang Road.

Assessing Potential Upside and Risks

From historical data, we know that the value of properties in Singapore has multiplied many times over. 30 years ago, the value of a small private apartment in Singapore was around $50,000. Today, the value of a small private apartment in Singapore is at least $500,000 on average. Due to the scarcity of land in Singapore, as well as her growing population and attractiveness to foreigners as a place in which to live and work, we can say that the value of properties in Singapore will continue to rise.

Based on these observable trends, it is safe to say that properties in Singapore generally offer good long-term potential upside. But the meaning of “potential upside” as applied to buying specific properties is not the same.

When you want to buy, you want properties that you have assessed to have high potential upside. When I use the term, “potential – upside” within the context of a particular property, I am referring to the potential returns from the property that I can measure at this point in time. It is very time-and-property specific. Note that I used the word “measure” and not “see”. It is not just an observation. I do calculations in order to measure the potential upside of a property.

Another point I want to highlight is that I am not measuring the “future” potential upside when I assess the potential property. I am measuring the current potential upside of the property.

Many people misunderstand potential upside as future potential. This is a common mistake – they are lured based on the idea that the potential upside will come true in the future. The future is something nobody knows for sure.

“Timing” is not a good enough reason to buy. Value is. Even if there are new launches and the price seems low, or you happen to have spare cash, a property is still not a good buy if the potential upside is not clear to you.

I also measure “potential upside” in a very specific manner before I make the decision to buy a property, I must be able to determine the potential upside of the property based on prices under current market conditions. For example, current transacted prices of similar types of properties within the same area.

Rental yield assessments should also be based on current market rates and not future market rates. Getting a sense of what the rental yield is likely to be, is not difficult. One simple way you can check on rental yields is to scan through the property classifieds on websites or in newspapers to see what similar properties (or the same property) are asking for in terms of rent.

Measuring Potential Upside

For the purposes of assessing potential upsides, my team and I have created a customised software programme that allows us to among many other things, compare current transacted prices within a given project or across different projects within a specific area.

This invaluable tool is used all the time to make sound assessments of potential upside for our clients. Here is a sampling of what the software can do:

Example: The Sail

The sail is a private residential property project launched in 2009. The following chart shows the transacted prices of units within The Sail from March 2009 to June 2011. In that period, a total of 18 transactions were recorded. The average psf transacted price was $2,670. When it was first launched, the transacted price was less than $2,000 psf. The highest transacted price in that project was $3,000 for a unit on the 25th level. For comparison, a unit on the 21st level sold for $2,620.

Expressway of Singapore

Express in numeric values, we can say that the potential upside for buying the unit on the 21st level is good as there is a difference of —$380 psf ($3,000-$2,620) between the buying price and the highest transacted price. Based on transacted prices, we can tell that the price can go at —$3,000 psf when we choose to sell it. When we buy, we buy with the aim to sell, as that is when we can take profit. We will further discuss the different ways of comparing potential upside using different price factors in a future post.

Hundred Palms Residences

Below is a quick glance for the project information for Hundred Palms Residences.

Project Name: Hundred Palms Residences
Developer: Hoi Hup Realty
Tenure: Leasehold 99 years w.e.f. 29 Feb 2016
Address: Yio Chu Kang Road, Singapore
District 19
Units Mix: 3 Bedroom, 4 Bedroom, 5 Bedroom
Total Units: 531  Exclusive Units
No. of Blocks/Levels:  9 Blocks, 15 Storey
Car Park Lots: TBA (1 Basement Carepark)
Expected TOP Date: 28 February 2020 (Launching Q3, 2017)
Site Area: 18,422.9 sqm
Architect: Consortium 168 Architects (C168)

The new Hundred Palms Residences EC land parcel attracted 10 hopeful bids with Hoi Hup Realty emerging winner with a top bid of $183.8 million. The land cost translates to a land cost per square foot per plot ratio(psf ppr) at $331.02 and an estimated Hundred Palms Residences EC price to be in the range of $750 psf to $800psf.

Hundred Palms Residences Project Information

A new site on the Yio Chu Kang Road (YCK) / Hougang has managed to attract significant interest from various developers. It has managed to receive ten bids by the close of the tender on the 18th of February, 2016. This site is intended to be developed into an executive condo property. The winning bid is worth S$183.8 million and it was placed by Hoi Hup Realty.
Yio Chu Kang Road

According to the director of the property development company, the breakeven cost will be just above S$700 psf. Therefore, it is likely that the sale price being the target will be S$800 psf approximately. Of course, the actual pricing will be dependent on the market conditions at the time of the sale. The company expects to launch the project in 2017.

Why Buy Hundred Palms Residences EC?

  1. Hoi Hup Realty is a popular developer behind this project
  2. More than 500 units to choose from starting with 2 bedrooms to cater to different needs.
  3. Easy connectivity to multiple expressways including Central Expressway (CTE)
  4. Close proximity to prestigious school
  5. Attractive pricing from just $700K
  6. Magnificent interior designs and modern layouts
  7. District 19 and close proximity to Kovan Town Centre & Kovan MRT

Hougang (Yio Chu Kang) Master Plan

Yio Chu Kang Road EC site area is around 198,529 square feet. Thanks to a plot ratio of 2.8, a gross floor area of 555,246 square feet will be the maximum allowed on the site. Around 520 units should be available to the residents.

When the site was launched for sale in 2015, experts had predicted that the winning bid will be in the range of S$260 to S$340 per square foot per plot ratio. They also believed that the site would attract somewhere from 5 to 14 bids in total.

The bids for this EC site illustrate the interest in this sector by the property developers. This is despite the fact that there are still a large number of EC units that have remained unsold. Moreover, there are additional EC units that are currently being developed and yet to be launched.

Experts noted that the interest in this site is specific to its location. As such, it should not be taken as an indicator of the wider market conditions. The competition seems to have been intensified due to the ease with which residents will be able to access the development. Moreover, various facilities and amenities are within easy reach. The site should be particularly of interest to parents thanks to the convenient location of reputed schools in the vicinity.

Another reason for the increased interest is that the site is located in an area surrounded by HDB estates. As a result, the developer will get access to a ready catchment pool to get residents from.

Assessing Risk for property

In addition to the potential upside for a property, I also assess the risks associated with it. Risks can be measured in terms of comparing rental income with other properties within the same location, or with other units within the same development. Risk can also be measured by comparing capital gains based on other units within the same development.

For instance, going back to The Sail’s example, we can see that the current transacted prices exceed that of the current asking prices in the same development. This means that risk of buying this property is lower, as I can sell the property at a lower price than the current transacted prices and still take a profit at this point in time.

Actual Site Hundred Palms Residences

TIP! When assessing whether to buy or sell a property, ask to see the current or latest transacted prices of similar properties within the same development, or within walking distance from the property.

At the same time, check whether units with the highest transacted prices have the same features (e.g. same facing, level). Potential upside and risks are two concepts that form the basis of research and analysis in a systematic approach. It helps me make decisions on whether to buy or sell.

Some Ways To Waterproof Our Roof.

I like to read  this blog post and it was really good.  The original blogpost can be found here How to Waterproof Your own Roofing  If you want to find out more about sg roofing contractor  then enjoy to read this post.

Roof Image Blog II

In seeking to waterproof your roof, first, you have to understand whether said waterproofing is required. Therefore, you have to first check what material your roof is made of. If your roof is made of concrete, then it is probably already waterproof all by itself. Therefore, only fractures in your roof will need to be further made waterproof. This will save you a substantial amount of work, as rather than having to coat your entire roof with waterproofing materials, you will only have to work on certain areas that may require a little more waterproofing or a little strengthening. Contractors will be able to advise you on whether your roof requires such waterproofing. However, in the case that you choose to undertake the whole operation by yourself, then here are some tips on how to completely waterproof your roof.

Firstly, you have to prepare your roof for the coating of your choice. Therefore, check your roof thoroughly for any damaged caulking or unevenly applied concrete. If your roof has cracks in it up to 0.6cm wide, fill them in with caulk. However, if the fractures in your roof are wider than that, you have to conduct concrete patching to fill in these joints. Ensure that the area is completely dry before proceeding. If the surface of your roof is rough, there is a good chance that the coating that you choose to apply on it will not adhere well. Therefore, you have to grind the roof with industrial sandpaper or otherwise so as to smoothen the surface and ensure better adherence. As part of your preparation, you should further clean your roof to make for the best possible results in waterproofing your roof. Give your roof a thorough scrub to get rid of any dirt that may remain on the concrete. Let your roof dry before waterproofing it.

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There are many different types of materials available for waterproofing your roof. A liquid membrane has several benefits: it is both inexpensive and produces results at a rapid rate. Liquid membranes are coatings to be sprayed or rolled onto your roof directly, and therefore are easy to use. Liquid membranes, however, will make it difficult for you to achieve even coverage. Therefore, sections of your roof will be more thickly coated with liquid membrane than other parts of your roof. Should you choose a liquid membrane, follow the available instructions on how to apply it.

Another form of coating, a self-adhering sheet membrane is a large, rubberized asphalt membrane that you apply to your roof. Sheet membranes possess a benefit over liquid membranes in that they will allow you to achieve uniform thickness, but they are more expensive than liquid membranes. They also require greater skill in application as they are extremely sticky and you have to be careful in peeling the membrane to expose the sticky side, for they will stick upon contact with a surface and they are tough to remove from the surface once having bonded to it. You have to also mind how sheet membranes overlap, for improper laying of the sheet membrane will increase the propensity for leakages to occur in your roof. Ensure that lap joints are cut as per instructions and that a bead of mastic is run down every lap joint one foot from a corner. Sheet membranes are also not a one-person job, so you will have to find a partner willing to help you to avoid disappointment and a bad waterproofing job.

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If you are searching for a more eco-friendly method of waterproofing your roof, I suggest that you select sodium bentonite, which is basically clay. It is able to bond to smooth as well as coarse surfaces and will function as a great waterproofing agent, given that clay has high porosity and can prevent water from seeping into your house. It is also healthier for the environment, given that clay is more biodegradable than the rest of the materials and the harvesting of it produces little waste.


To read more go to How to Waterproof Your own Roofing

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What Are The Venues for Team Building Games in Singapore?

As I shared with my friends about mortgage plans and property financing solutions, I met up with my long lost friend who is in business. Recently, we catch up with each other and share about what we do. And I found out that my friend does company events such as teambuilding, leadership training and retreats for their staff.

So as we thought of working with one another, I would like to share with you what he has to share today – Venues for team building games in Singapore. If you are a business owner who wants to bring your employee out to have a day of fun and team bonding activities, this article will help you with your event planner. So, over to you Ken!

Have you always thought of bringing your people out of office just to have a day of fun and learning, and get back to work the next day bonded stronger, communicate better, and produce more results? Yes, and that’s what my job is! I help companies organise teambuilding programs that will shift people’s behaviour, to make them more proactive, more purposeful, and of course, more productive.

We do these through a series of fun and activities, and the people love our programs so much that they remember every bits of it, even years later.

However, in this article, I will want to share with you what are the venues you can go to for such company events in Singapore. If you were to organize one for your team (or you can get our teambuilding experts to help), then this list of venues will help you!

1. Sentosa


Sentosa is known as Singapore’s most popular playground. It is a tourist location, and one of the places Singapore is known for. So what’s best for Sentosa?

If you would like some outdoor activities under the hot sun, with the beach and the sea, then Sentosa is the way to go. And please, if you are in Sentosa, do not stay indoors. Sentosa is meant for outdoor games like frisbees, flying fox, water games, beach volleyball. If your company want to organise treasure hunt, this is a good place too!

2. Gardens by the bay


This is another popular travel location of Singapore. MNCs who fly in foreign delegates into their Singapore headquarters will want to use tourist spots for their activities. One, they can show their foreign delegates around Singapore, plus, they can have fun with their colleagues there!

Gardens by the bay have big event hall, and smaller function rooms for rent. It will be good for big events of up to a few hundred people.

3. City Hotels


Of course, you can consider hotels in the city areas too, like Raffles Hotel, Swissotel, or Marina Bay Sands. You can also choose hotels in the popular shopping district of Orchard Roads, and there are hotels like Marriott hotel, Hilton Hotel, and Hyatt hotel.

These hotel are situated right in the popular area of Orchard and this makes travel convenient. They also have different function rooms to cater to your event needs. That’s not all, you can be assured of top customer service for all your functions.

So there you go, a list of venues in Singapore for your company events. If you would like to know more about teambuilding information, you can follow our Facebook or Google Plus for more updates!