Best deals in the market as of December 31

As we are approaching the last day of the year, we have no time to waste for the tasks below:

1) List all the unfinished business and set a completion deadline.

2) Clear up things that need to be done by the December 31 deadline.

3) Put our money in all the right places in anticipation of another uncertain year.

When I said “all the right places”, I mean the best deals in the market that can protect your capital (because investment Rule No. One is “Not to lose money”), while offering you the best return under the criterion of passing almost no risk or downside to you.


Best interest rate and money saving deals in this market

Caution! Below are important things that you need to do by 11.59 p.m. today. Make sure you complete them before the virtual countdown. Right after you finish reading this article, roll up your sleeves and start doing it one by one.

1) Earn the most interest from your CPF account

Let me repeat what I said in my previous article “My love-hate relationship with CPF”. If you are below 55, go to your SingPass mobile app, navigate down to “CPF E-services”. Transfer money from your Ordinary Account to top up your Special Account to the maximum of $181,000. You will enjoy the maximum annual interest of $7,240. Because your Special Account pays 4 percent interest which no Singdollar fixed deposit can beat it.

2) Claim maximum income tax relief for FY2020

Next, top up in cash for Special or Retirement Account for yourself or your family members. Because the maximum CPF cash top-up tax relief per assessment year is $14,000 (maximum $7,000 for self and $7,000 for family members).

Also, today is your last chance to support a cause that is close to your heart. Don’t miss the 250 percent tax deduction for qualifying donations. You are paying taxes to the government anyway. Why not give it to your preferred charities? Unless you believe the Singapore government is a better charitable organization.

First, verify whether it is an approved charitable institution. Then check whether your form of donation is a tax-deductible donation.

3) Minimize interest paid to CPF

If you have withdrawn money from your CPF account to pay property stamp duties, legal fees or monthly mortgages, the CPF Board is going to charge you 2.5 percent interest again for what you owe them this year. Have you checked how many years they have been charging you 2.5 percent interest and how much interest you owe them in total by now? How much interest you could have earned from your Ordinary Account had you refunded the sum earlier?

Instead of keeping your spare cash in bank accounts or in fixed deposits to earn that humble interest, it makes more sense to settle your CPF debt right now. Again, go to CPF E-services in the SingPass app, look for “Make a Housing Refund with Cash” under “My Requests”.


Best property deals in this market

What is the biggest difference between an ordinary shopper and a bargain hunter, or an average homebuyer and a value investor?

They are two distinctive types of people who have totally different definitions of value-for-money, what they consider as value buys and where to find them.

For ordinary shoppers, they are easily carried away by gimmicks – year-end sale, up to 50% off, 2nd purchase with 50% discount, buy 2 at 30% discount, buy 3 at 40% discount, buy 4 at 50% discount … These are not bargains but sweeteners. They make people confused about need and want, end up spending more than their budget, and stuffing their house with unnecessary things.

Most people around are penny wise but pound foolish.

Similarly, for many homebuyers, when the agents tell them that the developer is giving away a special discount of 5 percent this weekend, they immediately rush down to the sales gallery with a deposit cheque in hand. Wow! It’s 5 percent off! What a great offer!

Five percent discount out of what? Did the developer markup list prices before giving discount? What is the psf price of a similar unit from past and recent transactions? How likely is the developer to further deepen the discount level to clear unsold units? How does the psf price fare compared with projects in the same district?

I have made a Youtube video on “Our Home of 13 Years” where I shared my 5-year-old 3-storey terrace house home purchased in April 2007 for $735,000. I got one question asking me “you are referring to a EC right?”

I did look at a 7-year-old EC project 5 minutes’ walk from the terrace house. A 3-bedroom unit was asking above $800,000 at that time. Which one was a better deal, the terrace house or the EC?

It is true that the residential property market has picked up in 2007. But it doesn’t mean that there is no good deal in all the market segments. Just because you don’t know where to look for good deals doesn’t mean that they don’t exist.

There is something very interesting of the local real estate market: Whenever a property agency is helping a client to market a certain type of property, there will be media articles highlighting the “hidden potential” of this market segment, how investors are eyeing at such properties these days; and recent deals closed in the market. Of course, they won’t forget to mention the details of the property their client asks them to sell.

In reality, are these recent deals signs of an up-and-coming market, or just some financially distressed businesses letting go of their assets to meet their debt obligations? Get some hints from the recent financial results of the seller. Compare the final selling price with the original acquisition price or check the market valuation. It is as clear as day for the real value investors and those familiar with this property market segment.

In Singapore, good quality commercial properties are monopolized under a handful of large developers or under REITs. In contrast, shops that command the highest rents in Hong Kong are often in the hands of individual investors, especially those located in tourist areas such as Tsim Sha Tsui, Mongkok, Causeway Bay and Wanchai. Due to absence of tourists (mainly from China) under Covid-19, around one-third of these shops are currently vacant. Landlords are offering up to 80 percent discount in rent. This is the best deal in the market for tenants!

A 3,000 sq ft shop in Mongkok was tenanted to a jewellery chain in 2013 at HK$2.2 million (S$375,350) per month. Recently, a café rented the same place at HK$450,000 (S$76,777) a month. Coincidentally, the same shop used to have a café tenant paying HK$480,000 (S$81,895). But that was 24 years ago in 1996.

These shops are usually owned by the well-to-do. But with rents drop a whopping 80 percent, many are ready to slash the asking price just to dump their money draining property. This is good news for bargain hunters who like to shop at the bottom of the market. After all, with close to zero interest rate, a net return of 4 percent is a good deal.

Now you see the best deal in Hong Kong is definitely not the Singapore-Hong Kong travel bubble. Stop looking at the wrong places for bargains.


Best learning and enrichment deals in this market

Like property investment, reading is my long-time favorite hobby. I am very much a bookworm. With a good book in my hands, I can skip meals. When I step into a bookstore, I can forget about time.

Above all, reading is the most cost-effective way for self-enrichment. Imagine you only spend the price of a restaurant meal, you can buy the author’s knowledge accumulated over years or even a lifetime. No matter which method you use to calculate the ROI, you can’t lose money with your investment.

Yesterday I got this message from my website chatbot: “I have bought and read your new book Behind the Scenes of The Property Market, should I get your first book No B.S. Guide to Property Investment?”

No, you shouldn’t, for two reasons.

Firstly, I have been learning and practising property investment for two decades. Now I am sharing all my lessons learned, industry knowledge and market insights. I spent over a year to put everything together. You pay what? Thirty bucks to learn all these from me? When you should have squandered $3 million to buy some properties and hopefully learn something from your experience? Please, save the book for those who can see the “bargain” here.

Secondly, as the author, I only have 9 copies of my first book left. And it is currently 99.9 percent out of stock in the bookstores. A few months ago, I told my publisher please don’t reprint this book for the fifth time. So please save the final few copies for readers who really need them. By the way, I have zero copy of my new book now and I am begging the distributor to send some to me when they re-open their office next week.

If you can afford a 5-star hotel staycation, a better deal is to sign up for the upcoming How To Buy Your First Private Home Workshop on 23 January 2021.

Imagine spending $399 or $749 for 2 pax you can learn everything about buying private homes from a trainer who has seen hundreds of houses, evaluated many private homes, and bought five times before? Think about how much money you could save if you could pick up some tips on how to research for the right home, negotiate with the sellers and get the most from bank financing. Think about how much money you would throw down the drain if you bought the wrong property, knew nothing about developer defects and dirty tricks of contractors.

Plus you can enjoy the comfort of learning in a 5-star hotel, with food and drinks individually served to you by hotel staff the whole day. Can you find a better deal than that in this market?


How To Buy First Private Home Workshop will be held at Hilton Singapore on 23 January 2021 (Sat). Seats are limited to comply with social distancing rules. Registration will be closed once we reach full capacity. Sign up today and see you there!