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”

Bloomberg Businessweek (Asia) - - CONTENTS - −Pooja Thakur and Christo­pher Langner

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 6­night 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.

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