Property Insider: Terrance Foo on the hallmarks of high-potential real estate
We’re kicking off the decade with a brand new segment – Property Insider – where we ask real estate experts the questions you always wanted answered but didn’t know whom to ask.
Meet Terrance Foo. He’s the Associate Division Director at PropNex Realty, the largest listed real estate agency in Singapore. With a team of agents under his care, Terrance has been in the real estate business for seven years and achieved more than 160 transactions in that time.
Boulevard: What do you do best?
Terrance: My area of expertise is mainly helping HDB owners to upgrade to their dream home, which is usually a private property, without touching their savings.
I also assist private property owners to cash out of their stagnant properties and help them invest in potential capital appreciation assets.
The majority of my transactions have been in Districts 14, 15, 16 and 18. I’ve also lived in and owned properties in these areas for decades.
Blvd: What’s the outlook for the market in 2020?
I’d say it’s still a buyer’s market. There are currently more than 50 new launch condos in the Singapore market.
Blvd: What are the best buys on the market right now?
Terrance: Many home buyers have been snapping up new launch condos because of the potential capital upside appreciation and lower capital outlay.
The best buy right now is Treasure at Tampines. Why? Because the launch price is around $1,300 psf. It’s also important to note that currently, ECs (Executive Condominiums) are marketing around $1,100 psf.
Blvd: And what’s the best buy at Treasure at Tampines?
Terrance: I’d say the 1,033 sqft 3br Premium is a very attractive buy. It’s priced at $1.3+ million and comes with an enclosed kitchen and yard.
Blvd: What new projects coming in 2020 are you excited about?
Terrance: There’s another new launch coming at Sims Drive. Based on the site area of 175,000 sqft and bid price of $732 psf, the estimated break even is $1,235 psf ppr. So with a profit margin of 15 to 20%, I expect the selling price to be around $1,420 to $1,480 psf, which is very attractive.
Blvd: What are the hallmarks of a high-potential property?
Terrance: Most buyers go for location, location, location! Things like freehold, near MRT and good schools – frankly speaking, all these things come at a premium price. Finally, when they sell these units, investors may not see as much upside as a leasehold property that’s slightly away from the MRT bought at a lower entry price.
Blvd: What’s the first thing people should do before beginning their property buying journey?
Terrance: Before buying their first home, I strongly advise clients to obtain a bank IPA on a home loan. With that, you’ll know how much you’re eligible for and decide what you can buy accordingly.
Blvd: Any words of wisdom?
Terrance: I always encourage buyers to go with an experienced agent who will not just show you the property, but also advise you with facts, figures and statistics to help you decide.
Before investing in a development, buyers should look at land bids, developer costs, study the breakeven price and the developer’s estimated profit, and get a Comparative Market Analysis (CMA) of the surrounding area to understand the risk levels and best entry price to go in for.
Blvd: What do you find most satisfying in your job?
Terrance: When I propose something to a home buyer and it helps them make money… that’s the best part of my journey. For example, I helped one of my clients buy Sims Urban Oasis for $1,300 psf. And now the latest pricing (as of Dec 2019) is about $1,500+ psf… so basically they made over $200,000 profit!
Where to next?
- Is it a good time to invest in the Singapore market? Read our latest Property Insiders interview with Roland Lek to find out.
- You’d want in on these new launch condos.