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Finding Good Bargains this Lunar New Year
By Property Soul(guest contributor)
Still remember my 2014 blog post “Finding great bargains in a Chinese New Year fair”? We flew to Hong Kong again this Lunar New Year and stayed in the same hotel opposite the Victoria Park Flower Market which opened from February 10th to 6 a.m. on February 16th.
Most people buy plants and flowers to decorate their homes and offices one to two weeks before Chinese New Year. Many visit the flower market on New Year’s Eve as a tradition for good luck. The busiest hours are after reunion dinner from 10 p.m. to after midnight.
People enjoy the atmosphere and fun to squeeze through the crowd with family and friends. But with tons of potential buyers, vendors would sell at the highest possible prices. Afterall, this is the critical time for sellers to make money.
Finding good deals in the flower market
From my experience four years ago, the perfect time to find good bargains in the flower market is before 6 a.m. on the first day of Chinese New Year.
When I woke up at 5.30 a.m. for the flower market, the place was still buzzing with visitors. Families with exhausted kids had headed home. But the younger crowd was still wandering past 6 a.m.The weather was surprisingly warm. If it was 8 to 10⁰C like last week, people would have left early.
I strolled one round in the vast market that occupied several soccer fields, telling myself I didn’t have to buy anything if they were not cheap.
When it’s 6.30 a.m., “bargain hunters” gathered at some stores to look for discounted offers. I decided to quickly grab something and go back for breakfast.
I got some lilies and gladioli for my mom’s living room for the visit later. I picked two bunches of beautiful lilies at a discounted price of HK$20 (S$3.4) each. I paid the same price for five stalks of daisies with different colours.
Seeing the first light at dawn, visitors started to leave in droves.When it passed 7 a.m., there were announcements over the speakerphones to remind store vendors to pack and the visitors to leave by 8 a.m.
Before long, one-third of the stores were empty and another one-third were packing. Store owners had made their money. They just wanted to go home to enjoy their well-deserved new year break.
Suddenly, I found a store with a special offer of HK$30 (S$5) for unlimited helpings of flowers.Even so, there were not many takers. There’s only so much one could carry with two hands. Not many had big bags or trolleys. There was no parking nearby and it was difficult to find a cab.After paying the minimum fee, the store owner kept opening boxes of fresh flowers and putting stalks after stalks on my arms.I regretted buying the lilies and daisies which were heavy and redundant with the latest offer.
One store offered HK$30 (S$5) for two handfuls of beautiful candies and lollipops. I passed the vendor a recycled bag to fill it up. My six-year-old brought them back to Singapore to share with her classmates. She became the most popular girl in class this week.
After dropping my purchases in the hotel room, I went back to the flower market again. This time I bought a pot of narcissus for HK$10 (S$1.7). I paid the same price for a pussy willow plant which was selling ten times the price at the supermarket.
By then, stores hadn’t arranged truck pick-up were starting to throw things away. To minimize wastage, there was a temporary recycle store to distribute boxes of unwanted things. I joined a small group of visitors to pick some free stuff for the kids, including balloons, hair bands, and a lunar new year dog soft toy.
Trucks with workers from the Food and Environmental Hygiene Department were standing by at the entrance. In less than 15 minutes’ time, they would start to clear the place. In less than an hour’s time, Hong Kong Chief Executive Carrie Lam would arrive at the market to personally inspect the cleaning process.
Finding good deals in the property market
Most people buy their homes when they feel the need to do so. Many can’t wait to take the plunge when they “hear” the market is “recovering”. Few have the patience to wait till prices drop to a “meaningful” level.
The busiest time is usually the first two weeks of a new project launch. Buyers are attracted by the atmosphere and excitement to squeeze through the crowd with families at the sales galleries and showflats. That is the critical time for developers to make money.
If not now, when?
After the property market slows down, some “bargain hunters” are happy taking any discounted offers from the developers. That was when I quickly grabbed my first condo unit at Mandarin Gardens in 2002, thinking that the price was good enough and my job was done.
Like the echo of good news during good times, bad reports spread like wildfire. Seeing the recession would last for some time, buyers left in droves in 2003. Stakeholders which made their money during the good times were happy to call it a day.
Suddenly, I found a bank sale property asking only for S$360,000 – for a 1,194 sq ft high-floor unit with full seaview and next to the MRT station. The property agent kept asking me to buy.
I regretted buying my first property. It now looked pricey with the latest asking price.
There was no lack of good quality properties at great locations that were on fire sale between 2003 and 2006.
Even so, there were not many takers. Not many people had spare cash or deep pockets during the market downturn. Banks were tightening borrowing and it was difficult to secure a loan. The rest of the investors had the money but not the mood to invest when the bear market had persisted for some time.
Applying the bottom fishing strategy in property investment
When is the perfect time to find good bargains in the property market? I share this in my book No B.S. Guide to Property Investment – Dirty Truths and Profitable Secrets To Building Wealth Through Properties:
“You can tell when the market is bottoming-out when:
You see very short listings of properties for sale in the paper and property sites.
You call up property agents and they have all the time in the world for you.
You are the only one who comes for the viewing and the owner begs you to buy.
You talk about property, and people look back in pain or in contempt.
The market is gloomiest, everything looks depressed and everybody is pessimistic.”
You must have the guts to invest against the property cycle, and above all, the patience to wait.
Remember what Jim Rogers said? When things are cheap, when everything is distressed, when everyone is demoralized.
Remember what John Templeton said? Only buy at the point of maximum pessimism. Wait until the ninety-ninth person out of a hundred gives up, when all signs of funds, hot money and hard-earned money, are drained from the property market.
Like buying undervalued stocks, buy only after a major market correction. Because when you buy way below the fair market value, the risk is lowered substantially.
Be prepared to walk away without buying anything, even though it is human nature that we feel worse missing an opportunity compared with making a bad investment decision. But history tells us that indifferent buyers and investors often end up getting the best deals.
Above all, have financing ready to be able to act promptly when a good bargain swings by. Otherwise, even if the gem is dirt cheap, you won’t be able to bag it home with your bare hands.
By guest contributor Property Soul, a successful property investor, blogger, and author of the No B.S. Guide to Property Investment. Posted courtesy of www.Propwise.sg, a Singapore property blog dedicated to helping you understand the real estate market and make better decisions. Click here to get your free Property Beginner’s and Buyer’s Guide.
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