Cater to expats and prosper
With the property market in Shanghai softening, a growing number of owners initially planning on flipping their flats have been forced to think long-long. That is forcing them to compete for tenants, increasing the demand for professional property services, ranging from design to management and marketing.
One person benefiting from this need is Manlo Cheng Hui-sang, former general manager of the Sandalwood, the city's most expensive villa estate, as well as Le Chateau Villa, a favourite of multinational executives and foreign dignitaries, who pay rent as high as US$12,000 per month.
'My job is to help my customers sell or lease their houses as high as possible,' said Mr Cheng, 52, who founded the consulting and leasing agency AM Property Management (Shanghai) in 1997.
The key to making the most of an investment property, he said, is understanding the sensibilities of expats, who tend to be the highest paying renters, since they often receive housing allowances. 'Money can't buy taste,' he said. 'If you target foreign corporate tenants, you have to understand their culture and what they need most in a house.'
He cited the simple example of a dishwasher. Many owners do not consider it a must, since domestic helpers are inexpensive on the mainland. 'But your house will go first if you have a dishwasher,' he said. Other not so expensive ways to distinguish a rental property, he suggested, is to install hydro-power floor heating for the entire house and anti-fog mirrors in the bathrooms.
'Most local owners just use central air-conditioning for heating, which is very dry and expensive,'' he said. 'But one can wear shorts in winter if the house has hydro-power floor heating. It is not only a cost-saving but also comfortable.'
One of his current projects is the Risen Villa estate in the western upscale residential neighbourhood of Hongqiao.
The developer set aside 25 of the project's 93 homes for leasing, betting on the possibility that if the nearby airport - currently serving only domestic flights - is reopened for all flights from Hong Kong, the area's prospects will improve.
After Mr Cheng completed the renovation of one 360-square-metre villa recently, it rented out for US$8,500 per month, he said, compared to US$5,000 before the work was done.
