Covid-19 aka "Crisis of a Generation": Should I buy or sell now?

How is the Market Situation?

The Straits Times reported on 9 June 2020 that resale transactions for non-landed private homes saw a plunge in sales volumes with 171 transactions in May 2020. This is 80% lower than May 2019 and a 43% decrease compared to the 300 transactions in April 2020.

Prices increased 0.1 per cent compared to April.

The Straits Times reported on 4 June 2020 that Housing Board resale flat volumes dropped in May 2020 to levels not seen in the last thirty years. 364 flats changed hands. This compares to 2019 total resale volume of 23,714 (monthly average 1,976).

Similar to the non-landed private home sector, prices increased 0.1 per cent compared to April.

The reduction in transactions could possibly be due to Circuit Breaker measures preventing physical viewings, or general reduction in consumer confidence resulting in deferral of big-ticket spend.

Recap of 2008 Property Boom

Singapore experienced a property boom in the middle of the recession triggered by the financial crisis. This was widely attributed to a change in investors' perception: an increasing number of people viewed real estate as a safe haven after reports of failures in financial products.

Transact or wait?

Given the possibility for borrowers to defer payments for both home and personal loans, it is unlikely that we will witness a significant fire sale in the near future. Barring exceptional changes in personal circumstances, sellers will likely have the holding power to wait out any temporary price weaknesses.

For buyers, in the short term, the pre-pandemic factors continue to apply: reassess your available budget depending on how your earning power will be affected - affordability is key.

In the long term, I would recommend all participants in the real estate market to scrutinize PM Lee Hsien Loong's 7 June National Broadcast  here. As we face the "crisis of a generation", should real estate continue to be the asset class of choice for wealth preservation/growth? This question would require examination of the drivers of property prices which I will share in a subsequent post here.

Thank you for reading.

Post COVID Virtual Communication Guide

In the current lockdown/quarantine environment, work has taken on a slightly new dimension. Other than the challenges of your physical working environment (is there a proper home office available), family arrangements (young and elderly in your household), one significant challenge is to adapt to the main mode of communication: virtual communication.

While this is not new for most millennials, what is different is that virtual communication used to be one (out of many) means of communication, whereas now almost all communication will be virtual.

How then can we thrive in this environment?

Over-communicate

Go back to basics: Be clear and frequent in your communications.

Allow peers and your superiors an opportunity to understand your thoughts, plans, work, and emotions. Try practising the habits below:

1. Make your work more visible:  Agree with your team where and how to give updates. Ie. project updates on gsheet, status updates chat (slack/workplace/teams) group, begin each week with a standup meeting. 
2. Create communication channel norms:   Align with your team/manager on the best ways to stay in touch and when. Try using the channel map below! 
3.  Use emojis to convey tone:  Tone can be mistaken when communicating virtually. Try using emojis to help you communicate more effectively.
4.  Ask for clarity & feedback:  Most people will not communicate with perfect accuracy all the time. Do not be afraid to seek clarity if you did not understand something. Equally important, ask for feedback from others.

Create a communications channel map 

This should be co-developed with your team to align communication norms (when, where, what to communicate). An example is as follows:

Where do you start?

Ask at least one person today for feedback on how you can improve your communication!

And as always, leave comments below for more ideas that you would like to share.

Covid-19 impact to Real Estate Market

The effects of Covid-19 is real and is felt around the world, across numerous industries. For real estate professionals in Singapore, it is most obvious through the way the business is conducted since the announcement of the circuit breaker.

Real estate salespersons ("RES') are no longer allowed to accompany clients for physical viewings, but are allowed to conduct virtual meeting with clients using video conferencing tools. The thought of talking to a black screen (if you are lucky enough, clients who enabled video and are visible during the conference!) for a good 1-2 hours and not being able to decipher clients' reactions is a rather daunting task. 

I was lucky enough to be invited to a Zoom conferencing conducted by Kelvin Fong from PropNex on "Master the Art of Online Closings" on Labour Day to hear first hand on what RES can do to close deals and generate leads and here are my personal reflections.

Change your Mindset

There are always willing clients who are looking to buy or sell a place regardless of how bad the economic condition is. Similar to the financial markets and the economy in general, there will be pockets of "winners" who benefit from the current "doom and gloom". RES needs to change their mindset and start thinking of ways to enhance our customer experience using the video conference sales skills to value add to our clients. 

Practice makes perfect. Practise selling with your network, spouse or friend and let go of your self-expectations.

Make friends (while complying with safe distancing!) 

Don't bother selling during your first video conference session with your client. Focus on providing facts and information about the real estate market and treat it as a relationship building session. 

For new RES, the key is to start trying out video conference with a friend. After the session, invite feedback and ask the following questions:

- How do you feel during this session? 

- Did you manage to learn anything useful during this session? 

- Would you like your friends to be equally informed about the Real Estate industry and if so, would you mind sharing a friend contact with me whom you believe will benefit from this conversation?

Establish client's trust and help build a level of safety

Clients naturally will have anxiety during this period of uncertainty as they face job uncertainty and insecurity. This uncertainty may result in clients being unwilling to commit to a long term investment in real estate. 

The key is for RES to help clients understand their safety net and construct their long term plan. With these in place, clients are able to determine how much they are able to self-sustain and have a clear goal in mind.

Be prepared and know what you are selling

Unlike traditional sales channel, clients expect you to know your facts and information at your finger tips. Don't expect to furnish clients with more information only during another conversation.  Come prepared with bite-size presentations through anticipating questions that clients will ask.

Celebrate every win

Doing the above does not ensure that you will be able to close a deal. But it will open up you to potential opportunities which you may not get if you don't try.

Real estate investment is a huge investment for most of our clients and without being able to physically view the property, clients would require other forms of trust and comfort before making a commitment. RES can't decide for clients whether the property is a good buy. However, RES can provide clients with necessary facts and information to allow clients to make informed decisions.

For those who have successfully closed a deal, do celebrate every win (regardless of size), and share your experiences and feedback. One way of doing that would be to leave your comments below!