Monday, June 6, 2016

6 Condo-Hunting Tips that will help expats in Singapore save money


Renting a Singapore condo can take a huge chunk of your monthly income, if you aren’t careful about finding the right one. No matter what your budget, there are actions you can take when apartment hunting to save you money.
 
1. Take Your Time
This first tip makes all the rest easier to implement. Whether you are changing apartments, or moving into Singapore, you increase the probability of paying more if you don’t allow yourself enough time to find the right home. If you have the chance, give yourself at least a month for apartment hunting – i.e. researching, inquiring, comparing, viewing, etc. Ideally, you have the opportunity first to shortlist condos that match your requirements and style before the “pressure” time when you need to view available apartments and make a decision.
 
2. Get the Real Data on Rental Prices
Knowledge is power! So even in a “tenant’s market”, if you go into a negotiation without knowledge of the market prices, you may pay too much if the other parties know more than you do. And you can bet that most landlords are following the market prices. Here are three ways we don’t recommend you rely on:
§  Anecdotes from acquaintances: Just hearing what a few people are paying here and there is not enough for you to know the market.
§  Agent advice: You may be lucky and have an informed agent, but you shouldn’t rely on that alone. It’s your money.
§  Browsing classifieds/listings: You can expect that most landlords add 10-20% to their minimum price for “negotiation.” But also, some agents may sneakily advertise other apartments for unrealistically low prices simply as a way to try to find clients who they can then show other apartments too. In other words: advertised rentals may range from too low to too high.
So how can you know what the “real” market prices are for a condo? The government tells you! Singapore’s Urban Redevelopment Authority (URA) lists the signed lease contracts every month, including the condo, bedrooms, size, and monthly rental. Select any condo and you can view the last few month’s data to get an idea of what everyone else is paying. To make it simpler, at Key Location we provide this data for every condo, i.e. whenever we display rental prices for a condo, it’s based on the “real” records from the URA and not from advertisements. Each condo also has a graph of the last two years records so you can see if they’re trending up or down (spoiler: currently it’s down).
 
3. Look for Poor Quality Listings
Time for our first non-obvious advice – if you’re looking to save money, then skip past the listings that have great photos and description and look for the ones that don’t. Why? It’s all about supply and demand. Nobody has time to go through the 50,000+ advertisements for Singapore condos themselves, so people naturally will focus on the ones with nicest photos first. But if you’re one of those people then having competition for that apartment means the landlord is less likely to negotiate. That apartment listed down the page with only one photo may be nicer in person than the one at the top with lots of photos too – i.e. the number of photos doesn’t necessarily relate to the quality of the apartment! A landlord with a lazy agent who’s not putting time into listings may be desperate to find a tenant and so be happy that you’re the first inquiry for the week. Of course, you don’t want to waste your time visiting apartments that aren’t well maintained, so you probably want to push the agent for more details/photos once you inquire and before you inspect.
 
4. Don’t Pick a Condo with Facilities You Don’t Need
Many condos in Singapore are downright luxurious – more like a resort than a residential complex. Great pools, tennis courts, semi-professional gyms, golf practice, reflexology paths, jogging tracks, etc. It’s easy to see these and fall in love, but question whether you truly need all those, or would you even use them? Even though you might not use the jogging track or golf practice, others would, and they’d be willing to pay a little more for that luxury. That’s what will determine the market price of apartments in the complex. Financially speaking, you’re best to pick a condo that has all the facilities you need, and none that you don’t – even if the latter would make great Instagram material and make your friends back home jealous.
 
5. Location, Location – But Is It Yours?
This point is similar to Facilities, but for Location instead. There are certain “premium” locations where you’re paying extra for what’s nearby instead of what’s in the condo or apartment itself. For example, large apartments nearby international schools will attract a premium because there are plenty of expat families who are willing to pay for the convenience. Similarly, condos of any size which are near to Downtown or within convenient MRT time will also cost a premium due to all the city workers who don’t want to spend a lot of time commuting. However if you don’t work in the city, or don’t have kids at that international school nearby, you’re going to be paying a premium for something (“location”) that is of no value to you. So, it’s important to understand why a condo costs a certain amount and don’t pay extra for convenience to someone else’s locations!
 
6. Use an Agent
Agents get a bad rap in Singapore at times, but think of them like financial advisers – you just need to find a good one. We won’t go into how to do that (ask your friends, colleagues, etc.) but instead, why would you use one? First point: they will probably save you money. A good agent might know an “underappreciated” cheaper condo that’s just right for you (e.g. could be 30 years old but in fine condition), and they also can be accomplished at negotiating – it’s part of their job, so they’re probably better at it than you. They also can make appointments and drive you to apartment viewings, which saves you both money and time. Second point: they may not cost you anything. If you’re renting an apartment for $3500 or more per month, and you sign a lease for two years, you nearly always won’t pay a cent for that agent who’s done all that work tracking down condos and apartments, driving you to them, and negotiating your lease. Why? Because the landlord’s agent will split the commission with them. Whether to use an agent or not requires a much longer discussion than we have time for here, so just take away this point: it might save you money, so don’t rule it out immediately.

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