THE SAVVY SPECULATOR

Jan 27, 2007

THE SAVVY SPECULATOR

He does his homework before a buy

By Lynn Lee


http://img169.imageshack.us/img169/6...ty1t34cde8.png
AN EYE FOR A BARGAIN: Mr Cheng,
a managing director, with wife Lena Tang
and nine-month-old son Ethan. Only 31,
Mr Cheng has made a tidy sum from buying
and selling property. He currently owns three
residential properties, all of which have
risen in price. -- CHEW SENG KIM


WHILE the rest of Singapore tries to shake off slumber at 6am, Mr Eric Cheng ploughs through The Straits Times classified section for 'cheap' private property to buy.

If he spots a gem, the 31-year-old managing director will make sure he is the first person to view the property that morning.

Sometimes, he gets so 'excited', he makes an offer on the spot.

But he is not like the herd-like speculators of the 1990s, who bought private property because everyone was doing so.

Instead, his buys are backed by diligent research.

'I do my homework. I read up on market trends, research on home prices in the area.

'I buy only when I think I can sell it for more, or that I can rent it out for a price that will cover my monthly loan installments,' says Mr Cheng, whose ECG group of companies deals in businesses like car rental, car grooming and real estate. He has a sparkling track record to date, having made a 'healthy six-figure sum' from buying and selling more than 10 private properties in the last three years.

He was drawn to the property market when he was a flight steward for eight years, and met passengers who grew their wealth from dabbling in stocks, shipping and real estate.

'For real estate, you make your own decisions when to buy and sell, unlike funds, when someone else makes these decisions for you.

'If you are careful, this doesn't have to be like gambling. You can use this as a means of investing, to earn for your retirement,' says Mr Cheng, who has a diploma in computer studies.

He currently owns three residential properties, all of which have risen in price.

One is a landed property in the east, where he lives with his parents, his wife Lena, 31, who works in a luxury goods boutique, and his nine-month-old son Ethan.

He bought it at nearly $1 million over two years ago, and estimates that it is worth around $1.2 million now.

The second is an apartment in District 9, around the Orchard Road area, bought two years ago for nearly $1 million. It is worth around $1.2-$1.3 million now.

His latest acquisition a few weeks back: A condo in the east.

He locked in the sale at around $500,000 but paid only around $50,000 in cash. The rest needs to be paid only when the unit is ready in two years. 'I think there's been at least a 10 per cent increase in its price now. So I'll sell when I get a good offer.'

Despite his success, Mr Cheng, who would say only that he earns a high five-figure salary, says his purchases will always be 'calculated risks'.

For instance, he took loans to buy his landed property and District 9 apartment.

'But I don't over-commit. I make sure I have reserve funds, to pay for a year's worth of installments for any unit I buy.

'So if something goes wrong, like the price drops or I have to sell it, it won't be the end for me.'