Me&MyProperty

Follow your head, not heart, in buying property

Ugly properties can be renovated, so focus on practical aspects like land lease and location

Entrepreneur Teng Kenyuan has one rule when it comes to investing in property: Do not be too emotional.

"Whether the property is ugly or beautiful does not matter. That can always be corrected through renovation. What matters is whether it suits your requirements."

The 36-year-old believes in not rushing into buying real estate just because something catches his fancy. He likes to tread carefully, sniff around for better deals in the area and negotiate before taking the plunge at the right moment.

This astute strategy has resulted in him owning one commercial and two residential properties in Singapore and abroad.

It is an achievement for a man who confesses to have failed in school and fallen into bad company in his younger days.

His diploma in mechatronics did not translate to a career, and an early stint in the civil service did not fuel his aspirations.


When it comes to investing in real estate, Mr Teng Kenyuan likes to tread carefully, sniff around for better deals in the area and negotiate before taking the plunge at the right moment. A margin of safety is necessary, he says, so one must always negotiate the price.  ST PHOTOS: FELINE LIM

A few failed attempts at business led him down the path of depression. It was around that time that Mr Teng was introduced to an investment guru whose mentorship had a positive effect on his life.


Mr Teng bought a freehold ground-floor corner unit at A-Z Building, which faces the main road, for $2.5 million five years ago.

Inspired and encouraged at the prospect of becoming financially independent through investing, he started learning more about the subject by attending lectures and courses.

Eventually, his hard work paid off and his life graph took an upward turn.


Mr Teng bought a Build-to-Order four-room flat in Sengkang for $171,000 seven years ago, and refinances the bank loan every three years.

Now, Mr Teng runs his family business, has an investment firm registered in Britain and is a financial educator and stock trader, investing with an aim to retire early.

Q Describe your property?

A It's a freehold commercial property at A-Z Building in Paya Lebar. I got it five years ago for $2.5 million. It is a 1,668 sq ft ground-floor corner unit facing the main road, with permission for commercial-cum-industrial use.

The front is a showroom to display our products - the trophies and awards we manufacture - while the back handles the machinery. It is also two minutes from MacPherson MRT station.

All the other properties in this area have a lease of 60 years, but this one is freehold. That was the clincher. For me, it does not get any better than this.

Q What were your reasons for choosing this property?

A The first thing that attracted me to this unit was the tag: freehold.

I had been looking for a unit that suited my requirements for a number of years before this purchase.

But a good freehold commercial property is hard to find in Singapore, where land is limited. So I was immediately interested in this one when I got the whiff of it.

The second attractive thing was the location. It is not only near the MRT station, it also faces the main road.

Exposure to traffic is a positive criterion. Since my showroom faces the main road, it provides my business with free advertising to the passing vehicles.

Last was the price.

I purchased this unit before the offer was made to the public, which means I got a pre-, pre-launch price.

The pre-launch price was $2,100 to $2,300 per sq ft for ground-floor units, while I paid 30 per cent less.

In short, it checked many boxes.

For me, this is my best property purchase.

Q What are the other properties in your portfolio?

A I own a corner terraced house in the United Kingdom which I bought in 2015 for £50,000 (S$89,000).

The owner was desperate to sell and the price was really good.

It is located in Stoneyburn, half an hour from Bathgate town in Scotland. The house is rented out and fetches me £500 in rent per month.

I also own a Build-to-Order (BTO) four-room Housing Board flat in Sengkang, which I bought seven years ago for $171,000.

Q What is your financing strategy for your properties?

A I took a loan against my commercial property after making a 30 per cent down payment on it.

At an interest rate of 2.1 per cent per year, my monthly instalment comes up to $7,640.

My BTO home was also financed through a bank loan. The loan amount is around $110,000, for which I make monthly payments of $700 from my Central Provident Fund account.

I refinance every three years, and currently have a floating-rate package with RHB Bank.

The flat has a standard fire insurance of $350,000.

My UK property was bought with cash. I dipped into my investments to pay the owner in full.

Q Describe your property investing strategy and market view?

A Housing prices are greatly affected by government policies and interest rates. When one understands this, one is aware how prices of property move.

People like to use many complicated metrics to invest. But I have just one really simple rule, which has been historically proven to work: Look at the easing measures that have been put in place.

Right now, in Singapore, we have many regulations and measures to keep the residential property market on a leash. I will start to invest in the Singapore residential property market only when the easing measures stop.

That will be a strong signal for me to put my money in.

In the meantime, investing in commercial properties is a better bet, in my opinion. One cannot go wrong with them.

Q What are the factors you look out for when buying property?

A One needs to be pragmatic more than sentimental when buying property. It has to fulfil all practical aspirations and be conveniently located. If it's not pleasing to the eye, renovate.

That's an easy problem to solve. But suitability is more important.

The lease of the land also matters. It is better to invest with an eye on long-term returns. Property prices will always rise due to inflation, so one has to weigh how much a certain property will increase in value down the years.

It is also necessary to fret over the price and not to overpay.

A margin of safety is necessary.There has to be negotiation and discussion on the price.

There are always good deals around, all you have to do is be patient and look.

Q What's your overall investing strategy?

A My portfolio is worth around $5 million and is pretty diversified.

Fifty per cent of my portfolio is made up of properties while the rest comprises equities, exchange-traded funds, stock options and so forth. A diversified portfolio is the greatest way to protect your investments.

Most of my money is parked in the United States stock market, where I trade using options to reduce my risk. The stock market is historically proven to be the best instrument to hedge against inflation.

Most of my time on the stock market is spent helping people invest safely, while I give myself 15 minutes a month to take stock of my own investments. I have a very passive approach to the market.

Q What do you think of the property market now?

A I am not too upbeat about the Singapore property market right now. There is too much government easing in place. But there are great bargains in every market condition.

In Singapore, prices of high-end residential properties have come down by as much as 50 per cent, so their valuation looks attractive.

Q Are you planning to buy any more property soon?

A I am planning to purchase more properties in the UK, since the market conditions seem favourable there. I'm pretty bullish on Brexit, and I think now is the best time to jump in. I believe investments in the UK will have a great turnover.

Q Your dream home is...

A A cosy house next to the beach, where I can enjoy the cool breeze and gentle sound of the waves from my window, and maybe take a dip in the sea at sunrise.

A version of this article appeared in the print edition of The Sunday Times on July 09, 2017, with the headline 'Follow your head, not heart, in buying property'. Print Edition | Subscribe