Man on the move

Aug 17, 2015

 

At 35, China-born Arthur Zhang has already created a mini empire in Singapore’s competitive property agency industry, with plans to grow even bigger.

By Romesh Navaratnarajah

I’m rushing to meet Arthur Zhang, the owner of boutique real estate agency OneHome Property, for a pre-scheduled interview and I’m already running 10 minutes late. I don’t like to keep others waiting since their time is precious too, so I apologise profusely when I arrive at his office in Ubi Crescent.

But instead of diving straight into the interview, which tends to be the case with many busy CEOs, he makes me feel at ease by offering me a packet drink and starts chatting about major news events of the week.

Arthur’s ability to make others feel instantly comfortable in his presence has helped him run a successful business that continues to thrive, but it wasn’t always easy.

 

Language shock

He first came here from China as a teenager and enrolled into Secondary 3 at St Francis Methodist School. While he was able to adjust to the new culture and living away from home, language was a big problem. To overcome this challenge, he would wake up at 5am every morning to translate and read through the textbooks for the subjects of the day before going to school, so that he could understand what the teachers were talking about in class.

“It took me two semesters to pick up and I registered for my O-level exams as a private student during the second half of my studies in Sec 3,” said Arthur, who went on to further his studies at the Management Development Institute of Singapore (MDIS).

After graduating, he tried his hand at the retail business, setting up a shop selling ladies apparel. But he quickly became discouraged.

“I had to wait for customers to come in and the amount of hours I worked did not add up to good returns,” he admitted. Although the business failed, there were lessons to be learnt.

“The retail business, which is quite competitive, provides valuable lessons in perseverance, sales and marketing,” he shared.

Nine years ago, the 35-year-old decided to try his luck in real estate, using the principles he had picked up from his previous business dealings.

“What I like most about the real estate industry is that you can see a larger and a more proportional return with the amount of sales and marketing efforts put in,” noted Arthur, who worked his way up at property agencies like HSR and ECG before starting OneHome in 2011.

Starting an agency from scratch in an industry where major players already had a stranglehold on the market was risky, so he had to think outside of the box.

For inspiration, he studied how some of his idols, in particular Bill Gates, Steve Jobs and Mark Zuckerberg, used simple ideas to change people’s lives.

In the end, he came up with a unique solution to solve a common problem faced by many agents, landlords and tenants involved in rental transactions – which is to resolve conflicts over home defects.

 

Handyman on wheels

For any minor repair works involving property rental transactions done through OneHome, the agency provides a free mobile handyman service for tasks such as changing light bulbs and fixing door knobs and cabinet hinges. As for major electrical works and plumbing, their call centre can arrange for an electrician or plumber to do the repairs.

With this process in place, all client enquiries are handled quickly, and agents don’t get hassled. “The idea is to make the job easier for our estate agents so they can focus on renting and selling property,” explained Arthur.

“Agents also have family commitments and need their privacy. At the same time, our clients are better served by back-end support from the company. This improves our productivity and service standards,” he added.

With some 80 agents presently with OneHome, there are plans to grow this number to 150 to 200 by the end of this year.

It would appear that 2015 has been an exciting year for OneHome, but Arthur acknowledges there are serious challenges facing Singapore’s residential market.

 

Do away with ABSD

He shared that his biggest worry is the slowdown in transaction volume, adding that there is a need to remove the additional buyer’s stamp duty (ABSD) of seven percent for Singaporeans purchasing a second property.

This is because the total debt servicing ratio (TDSR) implemented by the Monetary Authority of Singapore (MAS) in 2013 has served its purpose of ensuring affordability among buyers.

The TDSR framework specifies that the total monthly payments of a borrower, including car and home loans and even credit card debts, should not exceed 60 percent of the borrower’s monthly income.

“The government’s cooling measures have helped to stabilise the market, but if left in place for too long, it will become freezing. This will affect the livelihood of Singapore’s 30,000 agents who are self-employed and dependent on their commission.

“The industry is already suffering from a lack of new blood, as the barrier to entry for agents is higher due to regulations from the Council for Estate Agencies (CEA). In addition, the downturn in the market means more agents are dropping out, which is not healthy for the industry,” he said.

For the long term, Arthur remains optimistic about Singapore property. He believes the healthy job market and strong holding power of developers and homeowners mean private home prices won’t drop significantly, and expects to see a price correction of five percent this year.

 

OneHome Property was started in 2011 by Arthur.

 

Arthur’s top tips for owners renting out their property

• Make your home sparkle by adding a fresh coat of paint, as well as simple decorations, such as oil paintings, photographs, etc.

• Install a fibre optic cable point if you don’t have one now, as it’s important to many expats.

• When advertising your place, try to include a nice photo as it is worth a thousand words.

• Price your unit practically and realistically instead of setting prices that are too high for negotiation.

• Minimise the vacancy period rather than insisting on higher rent, i.e. an earlier commencement date is preferred.

• Choose the right tenant profile to avoid potential breaches, i.e. early termination.

• A longer lease term is better than a shorter one as it offers greater stability, and also allows you to hold a higher amount of security deposit against any future breach.

• Maintain a friendly but professional relationship with your tenant: nothing too personal, and don’t be too harsh.

• Choose the right property agent – those who possess good problem-solving skills can be of help should the need arise.

• Engage active agents in your district rather than agents who are your friends or relatives.

 

This article was first published in the print version The PropertyGuru News & Views.Download PDF of full print issues or read more stories now!