Regardless of whether you want a property for yourself to call your home or to rent it out, it is still an investment. Like any investment, you want to get the most for your money which means, you need to know how to look for properties and when is the right time to buy one. New property launches for sale daily but not all opportunities are worth your time. Timing is important and once you understand how real estate developers price their properties, you may be able to lock in a great deal.
In the real estate business, the sale of a property starts even before the project is finished. Developers put the properties on sale at very early stages. The reason why they do this is that it secures their financing. Some may even ask for a reservation fee or a down payment. This creates cash flow that they can use to access loans or to continue with the project. It also shows a commitment from the buyer to buy the property since they already invested some money in the property.
The way real estate developers price their properties are relatively easy to understand. At the beginning of a project, prices are the lowest. When you see ads for new property launches for sale, odds are that the project is still at an early state. What you need to know is that at this stage you get the best pricing. As the project advances, prices will start to increase. However, the condition is for properties to be reserved. As fewer and fewer properties are available for sale, the developers will increase their pricing since there is proof of a demand for their properties.
Indecision can lead to losses
The price that you pay for a property is influenced by your indecision or lack of a firm commitment. A simple experiment that can be done is to ask for pricing of property now then ask again after several months. You will notice that prices increase as fewer units are available. This can also be a double edge sword. Many buyers also experience the fear of missing out. That can also lead to rushed decisions which can cost a lot of money. For example, some buyers may be on the market to buy a property, and out of fear of missing out, they accept an offer that is above market value. The better approach would be to keep scouting and look for new properties under development.
The Proper Way To Scout For Properties
In Singapore in particular, real estate development is a very dynamic industry. New properties are being developed at an accelerated rate. They also sell at an accelerated rate. Because there are always new opportunities showing up, it is important to not react on impulse. When new property launches for sale, it is important to catch the early wave and be amongst the first buyers but it should not be a rushed decision. Also, a missed opportunity is anything but a tragedy as real estate projects are being developed constantly.