Did you notice that when you flipped the newspapers in 2012 and 2013, all the articles on properties were about ‘the next hotspot, ‘property boom continues’, ‘robust sales in projects’ and ‘achieved record high’?
Did you notice that fast forward to 2014 an 2015, the same media published articles consistently on ‘lower transaction volumes’, ‘drop in property prices continues’, ‘rental market continues to soften’, ‘more bank sales” and “lowest in six years’?
Have you asked the question why there were few articles in 2012 and 2013 warning buyers to be conscious about the overheated market?
Have you asked the question why there was almost an absence of articles in 2014 and 2015 mentioning the pockets of opportunities in this bleak property market?
Have you ever wondered why the media can flip-flop on their opinion and outlook of the market within such a short time?
Have you ever wondered why a project or a district that used to be the media’s favorite can become a snub overnight?
A review of newspaper headlines on property over the past three years can give you a better idea on what is happening.
Iskandar properties: Once a cult, now a doubt
1. Headlines with positive outlook
- Iskandar condos now investors’ darling (The Straits Times, Jun 15, 2013)
- Singaporeans snap up Danga Bay units (TODAY, Aug 19, 2013)
- Most foreign buyers of UEM’s Iskandar homes are S’poreans (The Straits Times, Sep 22, 2013)
- Iskandar property is hot commodity for investors: Poll (The Straits Times, Oct 07, 2013)
2. Headlines with pessimistic view
- Don’t rush to buy into ‘hot spots’ (The Straits Times, Mar 18, 2014)
- Iskandar: Too many homes, too soon? (The Straits Times, Jul 11, 2014)
- Is Malaysia’s Iskandar losing its shine as a property hot spot? (The Business Times, Jun 26, 2014)
- Oversupply by China developers sparks uncertainty over Iskandar’s rental yield (TODAY, September 30, 2014)
- Iskandar ‘housing glut’ may hit rents (The Business Times, Oct 01, 2014)
- Iskandar needs economic activity for housing market to take off (TODAY, Oct 4, 2014)
- Home prices in Johor slide in second quarter (The Straits Times, Nov 4, 2014)
- Housing glut worries over Johor’s mega projects (The Straits Times, Feb 23, 2015)
Executive Condominium: Good buy or good-bye?
1. Headlines with positive outlook
- Tampines EC ‘presidential suite’ to be priced at $2.05m (The Straits Times, Dec 27, 2012)
- Eyeing an EC? ‘Golden period’ to buy is here (My Paper, Aug 18, 2014) (My Paper Advance seminar on Aug 17 what to consider when buying an EC)
- Jurong EC draws record number of applications (The Straits Times, Oct 12, 2014)
2. Headlines with pessimistic view
- EC upgraders may take big loan hit (My Paper, Dec 11, 2013)
- One in eight EC units left vacant in Q2 (The Straits Times, Aug 18, 2014)
- No one home as executive condominiums wait for occupants (The Straits Times, Nov 17, 2014)
- Choices aplenty for EC buyers this year (The Straits Times, Apr 18, 2015)
Commercial Property: Is it hot or not?
1. Headlines with positive outlook
- Investors look into commercial property (The Straits Times, Dec 25, 2011)
- More switching to commercial property: banks (The Business Times, Dec 14, 2011)
- Strata commercial properties see record sales (The Business Times, Jul 19, 2012)
2. Headlines with pessimistic view
- Global economic uncertainty casts pall on industrial property (The Business Times, Oct 10, 2013)
- Occupancy rate of industrial properties falls to lowest level since 2007 (The Straits Times, Jul 24, 2014)
- Prices, rentals of Singapore industrial space continue to moderate in Q3 (The Straits Times, Oct 23, 2014)
- Shophouse deals continue to languish (The Business Times, 14 Apr 2014)
- Strata industrial units looking to fill the void (The Straits Times, 9 May 2015)
Shoebox units: When the hype fades
1. Headlines with positive outlook
- The rise and rise of shoebox units (The Straits Times, Sep 12, 2012)
- Buyers with HDB addresses drive demand for shoebox units: DTZ (The Business Times, 25 May 2012)
- For many, the shoebox fits (TODAY, May 17, 2013)
- Shoebox units lift resale home prices (The Straits Times, Aug 31, 2013)
- 8,700 shoebox units for resale from now to 2017 (The Business Times, Oct 23, 2013)
2. Headlines with pessimistic view
- Private home resale prices drop 0.4% in Feb, dragged down by ‘shoebox’ units (The Straits Times, Mar 28, 2014)
- Suburban shoebox units: Bottom falling out of sector? Experts say flood of new homes next year likely to put pressure on rentals (The Straits Times, Sep 2, 2014)
- Shoebox units ‘hit by weak leasing market’ (The Straits Times, Dec 1, 2014)
- Rentals of shoebox units may fall 5%-10%: Analysts (Channelnewsasia, Dec 27, 2014)
- Gloomy outlook for shoebox units as their numbers rise (The Straits Times, January 29, 2015)
- Measures to curb excessive shoebox units yield mixed impact: study (Business Times, February 2, 2015)
Lessons learned
1. Read with a pinch of salt
When developers are launching new projects, they have to buy advertising time and space from the media to get the desired publicity and attention. Wide media coverage is the result of their efforts in advertising, public relations and editorial contribution.
Nonetheless, the media have no loyalty to anything or anyone they have reported previously. When the tide reverses, or when something gets out of favor, they can immediately shift gear to cover the story in a completely different angle.
2. Get first-hand information
The press is only capable of reporting what has happened or what is happening. But they are poor in predictions and are not in a position to tell what is going to happen next.
As property buyers and investors, it is important to step into the market to have a feel of what is happening. It helps tremendously if you are an active agent, buyer, seller, landlord or tenant in the marketplace.
Take the hints from your observations: Are foreign investors losing interest of your market? Do you see transaction volumes increasing or decreasing at a slower pace? Are owners taking longer or shorter to rent and sell their properties in the market?
3. Form your own judgment
The job of the journalists is to look for news or stories and report them. It is not their obligation to do a serious research, followed by an in-depth analysis and a detailed report on any subject.
Like what Jim Rogers said in A Gift To My Children: “The media often propagates conventional wisdom. Judge the content of stories in the media and turn their inaccuracies to your advantage.”
Savvy investors all have individual thinking. They know how to digest the news slowly and in moderation. They understand that there is no need to be too excited when the media say something is hot. Similarly, it is not necessary to be too pessimistic when the media say the worse has yet to come.
Individual judgment is about the wisdom of not believing everything you hear. Like what they say: If you are serious, you lose.
This article was first published at Propertysoul.com
