Should a PR get a property in Singapore?
New launch condominium projects are always the topic of real estate agents and property buyers. Some will find it expensive, some will see a potential in its value. We had an opportunity to meet up with one of our potential clients to discuss their real estate plans in Singapore. They are a family with 2 school going children in the teenage years. Mr and Mrs Lee are from Korea and they have been in Singapore for the last 9 years. Mr Lee is a professional in the construction industry and his wife is a full-time homemaker and a discerning property follower.
Mr Lee just received his approval for PR in Singapore and they are now considering acquiring a piece of real estate for investment purposes. This is the 2nd meeting we had and it is now very clear that they are very much geared towards real estate as a form of investment rather than for own stay purpose.
Opportunities in New Launches
In the Singapore real estate situation, we can see that there are always opportunities available at any one time regardless of market situations. Even looking back to back in 2007, we can see that the prices of property have not come down very much for certain categories of properties. Usually, new launches in Singapore tend to be more resilient towards market forces we can see that prices have always taken a spike when it is near completion. Why? The Singapore market is made up of almost 90% home ownership and that has created a mindset that renting is not an option for the majority of the Singaporeans. It is being looked upon as an expense and not something that helps to build equity in the property. In other words, you end up helping the landlord to pay for the mortgage. This is something which a lot of locals are not comfortable with. This results in having people not wanting to sell, rent and wait for the completion of a property. This would mean missing out in new launch opportunities.
New launch properties are usually launched at prices at its lowest for the new project and prices will be edged up slowly with different phases of the project being launched for sale. Developers will raise prices according to market demand and supply situation. If the demand for a particular project gets stronger, more units may be released at different pricing or higher pricing but we can be sure that prices will not be any lower than the initial launch price on launch day.
Well, that is the norm but we do get rare opportunities of developers relaunching at discounted prices but this is not something that happens on a regular basis but it only happens when there are some major changes to the market situation or governmental policies on housing. This happened for 1 particular project. Check out www.thedublinroofers.ie. The initial launch price was at approximately $1,700psf thereabouts but after the introduction of additional cooling measure on 5th July 2018, the developer of this project started to give steep discounts to counter the price difference in view of the higher taxes involved. Is this considered an opportunity to pick up the property? The price difference is a whopping $200psf!!! Just by calculating the savings you would have saved if you bought a 1000 square feet unit, the difference is $200,000. That is as good as profit secured in your pocket. Will the developer slash further discounts? With the cost of the land and rising construction cost, it will be challenging for the developer to offer further discounts on this project. This window of opportunity will not last forever. This is a definite “limited time offer” and investors or homeowners who see it as an opportunity will need to act fast before the prices get back to the normal pricing again.