By Property Soul (guest contributor)

At the time of writing this blog post, Covid-19 had 6.6 million cases worldwide and over 383,000 people has died. To distract myself from the chaotic world outside, I re-read Robin Sharma’s best-selling book The Monk Who Sold His Ferrari. As the author told us, everything happens for a “lesson”.

There are no mistakes in life, only lessons. There is no such thing as a negative experience, only opportunities to grow, learn and advance along the road of self-mastery. From struggle comes strength. Even pain can be a wonderful teacher.

The pandemic has taught me very good lessons, both in life and in investment.

Lesson #1: We don’t need much to live and be happy.

Things are not looking good, but there are certainly good things around:

– Under lockdown, there is no traffic jam anywhere in Singapore, Kuala Lumpur or Bangkok.
– We don’t find any air or noise pollution from traffic, construction, road works or factories.
– My family has never been so appreciative of the dishes I cook for lunch and dinner.
– With exercising and home-cooked food, I have reached my ideal weight and fitness level.
– Last month I only spent $113 (no typo here) on my credit card bills.

Since the implementation of the circuit breaker, time was surprisingly easy to pass with my loved ones at home. Exercising, preparing meals, and playing with my younger daughter nicely occupied my time every day. As the author said in The Monk Who Sold His Ferrari, “happiness is nothing more than a state of mind that you create by the way that you process and interpret”.

Before the outbreak, I wouldn’t have imagined that I could be contented with such a simple life. Now I doubt whether things I used to do (putting make-up on, dressing up, eating out and going for appointments) and places I used to visit (shopping malls, restaurants and sports centre) are really necessary.

Lesson learned: When our habits have changed, the office, retail, F&B and entertainment scenes will never be the same again.

Lesson #2: You can choose to be in denial or face the reality.

After closing for two months, developers and property agencies still have no clue when sales galleries can be re-opened again. CEA advised property agents to embrace the new normal and go online for property viewings and transactions. The irony is: Brokerage business is built on human touch and trusting relationships.

Some developers and property agencies told the media that they have sold many new units to buyers who bought without visiting the show flats. If that is true, does that mean they are fine with continue shutting down the sales galleries later in Post-Circuit Breaker Phase Two and Phase Three? If the new sales business is so good, why does the URA data show that “Singapore new private home sales plunge 58% in April”, even before deducting the returned units the following month?

Have you ever bought a new or second-hand car without test-driving it? Will you buy or rent a home based on virtual viewing without going down for inspection? How reliable are virtual viewings of uncompleted properties or second-hand homes? Will you commit a hundred-thousand or million-dollar purchase and a 25-year loan after watching a 5-minute promotional video? Have you seen any virtual showflat or property video showing blocked views, strange layouts, water leakages, floor scratches, or wall cracks?
There may be some buyers who take that leap of faith. But they are the minority. They are definitely not the practical and rational buyers and tenants like you and me.

There is an interesting comment from the CEO of a local property agency that I read in an EdgeProp article dated April 30:

Those whose jobs are secure and whose businesses are considered essential services are likely to be in a position to proceed with a new home purchase. They include civil servants, those working in the healthcare or medical supplies sectors as well as supermarkets, food, and delivery services.

I don’t know how many of us are business owners or senior management of supermarkets, companies making face masks and ventilators, or from food businesses targeting only the consumers. But with my husband working in the healthcare sector, I am very sure that home purchase is the last thing on the minds of healthcare workers now.

Pharmaceutical sales reps cannot visit clinics. Few patients are seeing GPs unless they are very sick. Specialist doctors are postponing consultations and non-life-threatening surgeries but are still paying high rents. Healthcare workers working in government hospitals have a stable income but are too stressed to think about anything non-essential. Those working in the healthcare sector to proceed with a new home purchase now? Dream on.

While some property marketers are still in denial and continue to live in their own world, others have chosen to face reality. Knight Frank Auction is actively marketing some distressed sales of penthouses in prime districts. A 27-unit boutique project in Tanglin is going for a fire sale. The developer of 38 Jervois is giving a 13 to 24 percent discount to avoid paying Additional Buyer’s Stamp Duty as it approaches the 5-year deadline. There are also online ads of other uncompleted condo projects offering new discount packages to attract potential home buyers.

Expect to see better discounts and more fire sales in the market in the coming quarters. There is no hurry to buy. Patience is the key to buying a home. Lesson learned.

Lesson #3: Nobody owes you a living.

Singapore’s economy depends very much on international trading, consumption, and investment. These are all badly affected by country lockdowns across the world. As Singapore’s fourth-largest trading partner, the US reported an unemployment rate of 14.7 percent last month. The total number of unemployment claims over the past 11 weeks has surged to 42.5 million. Multinational companies that have resorted to global layoffs include Uber, Airbnb, Boeing, WeWork, Hyatt, HSBC, Deutsche Bank, Rolls-Royce, Nissan, Renault, IBM, Hewlett Packard, General Electric and Chevron.

After the Singapore government announced Jobs Support Scheme for local employees, employers are holding on retrenchment to benefit from the 75 percent wage subsidies while saving on the severance packages. Despite this, the Monetary Authority of Singapore said the country is still expecting a rise in job losses caused by the Covid-19 crisis.

Lesson learned: The real recovery of the global economy cannot depend solely on temporary government grants or QE infinity. It must come from actual consumer spending.

No one owes you a living during a crisis. Last week, Singtel announced its 4th quarter net profit falls 25.7 percent and proposed a dividend of 5.45 cents per share which is almost halved of the payout distributed a year ago.

In early April, more than 3,000 Hong Kong investors demanded HSBC reinstate its scrapped dividend payout for 2019 by removing compensation of top management for a year. Many retirees in Hong Kong are living on dividends from the 155-year-old banking giant which pays dividends for 74 consecutive years without failing. It is impossible for HSBC to pay dividends now because all UK banks such as HSBC and Standard Chartered are canceling all payouts now to comply with the Bank of England’s request to exercise prudence in the midst of Covid-19.

Lesson learned: The incident is a wake-up call for many who invest in stocks for the long-term. We cannot live solely on the dividend payouts of blue-chip companies in our retirement. Listed companies have the absolute right to cut back on dividends or stop paying dividends to shareholders altogether.

Lesson #4: Bad times are the best time to see through someone.

When we sense something is not right, we tend to stay put and hope that the problem can be solved on its own. Why rock the boat If everything else looks fine? If it ain’t broke, don’t fix it. But once the shit hits the fan, we are forced to face it head-on. It is when we see people in their true colors.

A recent article in titled “Covid-19 exposing how much landlords squeezing tenants in S’pore” revealed some the dirty tricks deployed by landlords during Covid-19:

– Instead of passing the government’s property tax rebate 100 percent to the tenants, they created their own special “conditions” to rebate only the “eligible” tenants
– Delayed and time-staggered payments across months
– Offered rent-free months instead of lowering rents, thus keeping rents artificially inflated
– Imposed gag orders on tenants to keep Terms and Conditions in tenancies confidential so that tenants cannot complain to the authorities or let the media know

With the outbreak of coronavirus, Singapore Airlines (SIA) cut its capacity by 96 percent after grounding 138 of 147 planes. Their share price fell to a 30-year low. To tide over the bad times, the national carrier announced that it would raise $8.8 billion by issuing rights and another $3.5 billion from a 10-year Mandatory Convertible Bond (MCB) issue, with 295 rights MCBs for every 100 existing shares owned. Each of the rights can be exercised at $1 for every MCB.

This week The Straits Times disclosed that, although the rights issue of SIA shares has been fully subscribed, but the rights issue of MCBs was undersubscribed. The balance $1.41 billion or 40.4 percent of unsubscribed MCBs are to be taken up by Temasek.

To the shareholders’ surprise, most SIA directors have chosen to let their MCB rights lapse without exercising them. Some took up neither the rights shares nor the MCBs. An SIA spokesperson explained that “the SIA directors act in their personal capacity as shareholders, and we do not comment on their individual investment decisions”.

The SIA’s fundraising announcement in April did help to save the company’s share price from a free fall. The issue of shares and MCBs was marketed as an attractive offer to entice the subscription from shareholders. Who would have thought that the board directors themselves would think otherwise?

Meanwhile, a co-founder of troubled Singapore sofa maker HTL just agreed to buy back the company. Mr. Phua Yong Tat has taken money from his own pocket to save his company which is on the brink of bankruptcy. Because Mr. Phua truly understands Nassim Taleb’s belief that companies who can’t eat their own dog food don’t have skin in the game. Lesson learned.

What lies behind you and what lies in front of you is nothing when compared to what lies within you.

And no matter what you are experiencing in your life right now, trust that all is good and unfolding in your best interests. It may not look pretty, but it is exactly what you need to learn for you to grow into the person you have been destined to become.

– Robin Sharma, The Monk Who Sold His Ferrari

By guest contributor Property Soul, a successful property investor, blogger, and author of the No B.S. Guide to Property Investment.

[Disclaimer: The main aim of is to provide good sources of information and opinion on the Singapore property market for our readers. These sources come from a broad mix of experts, who could be independent bloggers, analysts, and real estate professionals. We do not publish anything we feel is overly promotional or lacking substance, and do not get paid to post articles (any ads you may see will be clearly marked). That being said, you should be aware that every guest contributor has their biases, and so you are less likely to see an article from a property agent (for example) that will be negative on the market.]

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