Have an iPad? Use Flipboard to follow my blogs.

I am probably one of the least tech savvy person around. So, for me to blog about technology is a rarity.

Ever since I started using an iPad, high technology is just a touch away. It is really a joy to use.

Recently, I was introduced to an app by a very good friend. The app is called "Flipboard".

The "cover" of Flipboard looks like the cover of magazines. It uses pictures from the publications we are subscribed to for its "cover".

I am able to keep up with my favourite magazines, newspapers and blogs all with this one single app!

Once we "flip" the cover, we search for publications to subscribe to and they will become a part of our Flipboard. It is that easy.

I really like how the introductions to articles in my blog are visually presented. Looks very professional, don't you agree?

If you have an iPad, you know what to do. Just go to the Apple app store and download Flipboard.

It is free and that makes me happy too.

Related posts:
1. Protect your iPad.
2. China prices, global deals.

First REIT, AIMS AMP Capital Industrial REIT, ARA and Sabana REIT.

It is kind of late and I still have a long drive ahead of me. So, this will be a quick update with very simple charts.

My overnight buy order for First REIT at 76c was filled. My other overnight buy order at 74.5c was not filled although the unit price did go that low today.

Overnight buy order for AIMS AMP Capital Industrial REIT at 19.6c was filled. I thought that many people would want to buy more units of this REIT at 19.5c, the last low. So, I queued 1 bid higher at 19.6c.

Towards the end of the day, I also bought shares in ARA at $1.13 and units in Sabana REIT at 86.5c.

Like I said in my last blog post on ARA, I did not put in an overnight buy order at $1.17 which was the next support I identified if $1.22 should fold. I said I would rather wait and see. Today, ARA's volume was rather low and $1.13 was a good 9c lower than $1.22. Could we see ARA at $1.08 next?

As for Sabana REIT, I would like to get this closer to 83.5c, its last low. At 83.5c, it would be giving a distribution yield of 10.5%. 86.5c is a few bids higher.

Looking at the chart now, I think I should have stuck to the original plan and waited for its unit price to get closer to 83.5c. Well, who knows for sure? Could have a bullish harami in the next session. ;)

Good luck to us all.

Making your first million dollars in real estate investment: Dreams and nightmares.

Often, we hear that investing in real estate is the fastest way to making the first million dollars.

We saw people in queues and offering blank cheques in buying frenzies for projects such as One Devonshire some two years ago. The buyers then would have bagged nice gains and many would have sold their properties by now.

Sometimes, the building specifications of the property do not even matter for buyers. Positive sentiments just drive them to pay whatever asking price is out there.

Building specifications? Yes, for example, when I buy a condominium, I will find out how many lifts serve each block and how many units are there per floor per block. This is very important to me because if there were too few lifts, the waiting time could be unbearably long especially if we were staying on a high floor.

A HDB point block has 2 lifts serving 25 floors and 4 units per floor . This means 1 lift for 48 units (remembering that ground level is the void deck). So, if a property has 36 floors and 3 units per floor, having 3 lifts is about right. We get 1 lift for 35 units.

So, the lift to units ratio is very important, wouldn't you think?

Apparently not. Southbank, a condominium along North Bridge Road, has 197 units in its residential block but only 3 lifts. This means 1 lift for almost 66 units. This ratio is worse than a HDB point block! I wouldn't buy a unit there but it does not mean that people who did would not make money from their purchase. Indeed, in two years, its price has appreciated a hefty 50% on average.

I also consider having ample parking lots essential. All too often, I hear friends living in some condominiums complaining that their visitors cannot find parking lots in their estates and some even got their wheels clamped for parking in lots designated for residents.

We see so many condominiums built with just 1 parking lot per unit these days. If a resident has two cars, he is in trouble. Of course, where are visitors going to park?

We see many condominiums built with enough parking lots for only 80% of the units just because the developments are a short distance from the nearest MRT station. If every resident owned a car, things could turn ugly.

We also see some condominiums these days with mechanical parking lots and I read that it takes 7 minutes for a car to be parked. Imagine if five people should come home at the same time. Could the fifth car's waiting time be 35 minutes?

Increasingly, we see newer condominiums being more and more marginal in that they are compromising on the day to day pragmatics. These are projects I would avoid but it does not mean that one would not make money in these projects, of course. It is just that if it is not a condo I would want to live in, I wouldn't buy it. Quite simple.

Of course, some would say that buying a piece of real estate is about location, location and location. Doesn't matter if it has enough lifts, parking lots or whether it is freehold or leasehold. I imagine this to be true for most but for me, it is more than just location.

Now, certain things I can see and analyse but certain things I can't. It is a bit like buying shares of companies. We can look at a developer's history and the project's specifications and asking price psf just like how we can look at a company's history, its numbers and its share price. However, there will always be things we cannot see.

I read in the news today that a very reputable developer in Singapore, Wheelock Properties, is being sued for S$14m "in compensation for defects that have been plaguing the estate for the last three years". We are talking about The Seaview.

Wheelock Properties is the developer of Ardmore Park, long regarded as the standard in luxury condominiums before SC Global came into the picture with even more grandiose developments. So, it came as a surprise to me that "in late 2009, building surveyors found at least 32 cases of defects in areas such as lift lobbies, the swimming pool, residential units and the basement car park.

"In addition, the MC claimed that the contractors did not carry out waterproofing properly in areas such as the basement car park, causing damage and safety risks.

"Residents said the same problem was occurring on the rooftops, which meant that higher-floor residents had problems of water seepage and water-stained ceilings and walls."

The Seaview was marketed as the Ardmore of the east and was a very pricey project. It still is. A 1,647 square feet four bedroom unit is asking for $2.5m today. With quality issues aplenty, I wonder if buyers would give it a wide berth. If we take a look at Property Guru's website, we see many trying to sell their units in The Seaview.

So, is buying condominiums developed by a reputable company always a good idea? Is buying new always better than buying old because the perception is that the property's condition would be relatively newer and that less repairs are required?

The article on The Seaview is quite detailed and I have only reproduced a small section of it. To read the whole article, click here.

I have very few blog posts on real estate investment, I realise, and I hope you have enjoyed this one, especially if you are thinking of taking that next step to invest in a condominium in the next few years.
 
Related posts:
1. Real estate as a hedge against inflation.
2. Money continues to flow into Singapore.

3. New or resale property: Which one is a better investment?

Double dip recession or just very slow growth?

Stock markets around the world had a very bad week. Everyone it seems is expecting a global recession and the accompanying deflation.

In a truly deflationary environment, all assets will suffer and see their prices fall. Equities and precious metals were all sold down across the board, therefore.

However, reading an article in Bloomberg, it is interesting to note that in the USA, "railroads shipments are the highest in almost three years." This defies concerns of an impending double dip recession.

Art Hatfield, a transportation analyst in Memphis, Tennessee, at Morgan Keegan & Co: “We’re not seeing declines in rail volumes that are synonymous with a recession... We remain in a slow growth environment.”
Read article: here.

If we were to look at the Baltic Dry Index (BDI), we see it rising in recent weeks and I wrote a piece on whether it could be time to load up on shares of Courage Marine again not too long ago.

The suggestion is that there is an increase in demand for shipping capacity and because "dry bulk primarily consists of materials that function as raw material inputs to the production of intermediate or finished goods, ... the index is also seen as an efficient economic indicator of future economic growth and production. The BDI is termed a leading economic indicator because it predicts future economic activity." Source: Wikipedia.

So, is there going to be a double dip recession after all? There are analysts who believe that a recession is a given and some who believe that Europe will get its act together and a recession will be averted. With such conflicting signs, at this point in time, however, it is just a sea of opinions.

Personally, I do not believe in being overly bullish or overly bearish. I believe in being pragmatic. Putting all our chips on a single bet either way could be quite disastrous if we should be proven wrong.

What is being pragmatic? Knowing what the current conditions are, what kind of investments are likely to do better and act accordingly. It is about wealth preservation, if not growth.

Related posts:
1. Courage Marine: Added at 10.5c a share.
2. Should we be staying invested or in cash?
3. Sleep well at night with a plan.
4. Why do I not panic?

What the very rich are doing with their wealth?

I read an article provided by Bloomberg News that Singapore will become the world's top wealth management centre by 2013, surpassing Switzerland and London.

It looks like our tiny island nation is attracting a lot of wealth from around the world and we are not just talking about HNW individuals. We are talking about super HNW individuals and families!

These families are setting up family offices to manage their millions instead of entrusting their wealth to private bankers. They view private bankers as salesmen instead of custodians of their wealth.

Clinton Ang, 38, prefers to manage his family's wealth of about $100 million himself.  About 90% of his family's investable assets are in cash after he sold from October to March its investments in stocks, bonds and most property assets.

Some family offices cater to more than one family to gain economies of scale. It is said that it costs at least $1.5m a year to run a family office that includes an investment team. So, a family will need a minimum of $100 million to justify the expenses.

Personally, I know some very rich people but they never talk about their wealth. So, it is not easy to get a peek into the way they manage their money. Usually, those boasting about their wealth are the newly rich and who might have just attained their HNW status.

There is wealth and there is WEALTH.

ARA: Initiated long position at $1.22.

I initiated a long position in ARA today at $1.22 a share. This decision is based on my TA last evening. Fundamentally, at $1.22, the estimated dividend yield is about 4% but investing in ARA is primarily for growth.

The counter's share price touched a low of $1.20 before closing at $1.205 on the back of very high volume. Such high volume sell down usually has some momentum to follow through. So, we could see ARA's share price head lower next week.

Based on the TA I did last evening, the next supports are at $1.17 and $1.08.  However, seeing how strong the selling was today, there is a good chance that $1.17 will fold if it should be tested.

I am not putting in any overnight buy order, prefering to wait and see how things will unfold next week, given the strength of the selling.

What about the potential positive divergence? It is looking extremely dicey as the MACD took a nosedive today.

Although a fundamentally sound company, its share price could weaken further from here. It might be a good idea to wait for the dust to settle before adding to my newly created long position.

Related post:
ARA: Breaking support. Going lower?

ARA: Breaking support. Going lower?

I have been looking at ARA. The downtrend is persistent and I have yet to initiate a long position here.

Today, ARA's share price broke its previous low of $1.29, gapping down and touching an intra day low of $1.26 before closing at $1.27.

The DIs are negatively placed but the ADX shows that the downtrend is not a strong one. In fact, volume seems to be reducing as price weakens.

If this continues to be the case, the MACD could indeed form a higher low as price forms a lower low. A positive divergence in the works? Perhaps.

If we would like to do a bit of pre-empting, what price would we buy at?

$1.22 is a price that market participants would remember as that was the low of 21 Oct 2010 and the counter went much higher from there in the following months.

Next would be $1.17 which seems like a significant resistance which was tested many times before being overcome convincingly. It should therefore be an important support if tested. If that goes, we could see $1.08 next.

If we believe in trendlines and channels, we will see that ARA's share price seems to be nearing the support of its down channel.

Of course, this support could be compromised like it was earlier in August. However, when it was compromised, it recovered relatively quickly. Could it happen again?

Tea with AK71: Eldershield.

I am quite aware that I am ageing and, once in a while, I am reminded of the fact by other people.

Today, the government reminds me of this same fact by sending me a notice saying that I would be automatically insured under Eldershield come 31 December 2011.

Eldershield? Me? Wow, elder. This is cheerful.

So, being Singaporean, I want to know "how much"?

Annual premium: $174.96, payable till age 65.
Total premium from age 40 to age 65: $4,548.96

Second question, "what are the benefits"?

Benefits: $400 a month payout (maximum lifetime limit of 72 months).
Maximum claimable: S$ 28,800.00
Lifetime coverage.

OK, next question is harder. Do I need this? I mean is this really necessary? Opinions, anyone?

CapitaMalls Asia: Directions, please.

On 15 August, I mentioned that pre-empting a trend reversal did not work out and I ceased buying more shares of CapitaMalls Asia. Then, I used the rebound later in the month to reduce exposure.

On the daily chart, it is interesting to note that the Bollinger Bands are narrowing once more. This reduction in volatility when interpreted together with a rising 20dMA that is on the verge of forming a golden cross with the 50dMA suggests that price is more likely to rise than fall.

In the event that price should go higher, we could see it testing the declining 100dMA and even the downtrend resistance again. These are currently at $1.44 and $1.57 respectively. Gap resistance at $1.40 and $1.55 would have to be overcome first in these two instances.

What if price were to weaken instead? I would wait to see if the low of $1.13 holds up as support, failing which I would want to see if a higher low forms on the MACD. Looking out for a positive divergence? You guessed it.