Real estate agents suffer as Singapore tries to cool an overheated market
A slow Singapore housing market leaves agents scrambling for work Driving a private car “is the best trade for a property agent”
Billy Loh began selling real estate in Singapore in 2008, setting himself on what was widely seen as a path to wealth. Now he spends his working days navigating the city streets. Loh became a driver for Uber Technologies. “We have no choice. We have to come up with means to make ends meet,” says Loh, as he drives a Toyota Corolla he began renting in October.
Singapore’s home prices fell by 4.3 percent over the 12 months ended Sept. 30, the most among the world’s major markets, according to the Knight Frank Global House Price Index. The city-state remains Asia’s second-most
expensive luxury market (after Hong Kong), but a plunge in sales volume—down 68 percent since 2012—is hitting property agents hard.
It’s part of a plan: Seven years ago, the government began stepping into the real estate market to tame prices. The so-called cooling measures include restrictions on how much debt homebuyers can take on, as well as stamp duties to be paid by both buyers and sellers. Prices have been falling since 2013, the worst losing streak in 17 years, prompting calls to lift the measures.
Loh took up driving after going half a year without doing any property deals. He says he now earns an average S$3,000 ($2,092) a month. During the market’s heyday, he could nab a commission of up to S$30,000 from a single home sale.
Across the globe, people in the real estate business often must juggle several jobs—it’s a notoriously cyclical business. Singapore’s property agents have the added problem of unusually intense competition. There are more than 30,000 registered agents, or an average of 10 for every property transaction each month, according to the Institute of Estate Agents in Singapore. By contrast, the Australian state of New South Wales has 1,840 agents to handle an average of 8,160 monthly transactions in Sydney alone, according to CoreLogic.
Smartphone-centric ride-hailing companies such as Uber, which began operating in Singapore in 2013, and GrabCar, a private car service created last year by taxi booking app maker GrabTaxi Holdings, are attracting property agents to their quickly swelling ranks of drivers, say managers from both companies. The number of rental cars, a rough proxy for vehicles being used for private car services, has increased 51 percent over the past 12 months, according to Singapore’s Land Transport Authority.
Terence Tham, a nine-year veteran of real estate sales, decided that driving his Honda Civic for Uber could help him increase his client network. He hands out a business card for his other job to every passenger he meets on his 6 a.m.to-midnight shift. He says he needs all the leads he can get: “This has been one of the worst years for me in the property broking business.”
With further sales declines expected in 2016, Singapore’s industry group for agents is trying to help them find steady supplemental work. It’s offering courses in property management and other skills. That would “at least earn a fixed income rather than only rely on commissions in this market,” says Jeff Foo, president of the Institute of Estate Agents.
For agents in need of a new source of income, though, driving looks like a fast, flexible option, even if it means long hours behind the wheel. Ronald Han, a driver since July, says he works 50 to 60 hours a week driving to earn S$2,800 to S$3,200 a month, after fuel, maintenance, and other costs.
He’s trying to hang on to his old job, too. “This is the best trade for a property agent, you see?” Han says. “You can have free time if you have an appointment.”
The bottom line After a government-engineered slowdown, there aren’t enough real estate deals to support Singapore’s 30,000 registered agents.