Essentially the BTO of private housing, when you buy a new launch condominium you are technically buying into the idea of a property. Here are some of the reasons why it is a good idea to invest in it even with a waiting period of around three years before the condo materializes.
- Progressive Payment Scheme
Because a new launch condo isn’t physically there yet, potential owners are not expected to pay for it in full right away. Instead, buyers pay in several installments or several “progressive payments”.
This payment scheme for new launch condo singapore make it an ideal option for buyers who can’t shell out a huge amount upfront for the property. Instead, payments are divided in chunks to be paid over a specified time period.
Usually, the payments are spaced out every couple of months or when pre-set construction milestones are met by the developer. This basically means you will be paying around five to ten percent of the total prices every six months until the issuance of the Temporary Occupation Permit (TOP) which usually takes around three years from launch date. At this point, the remaining percentage of the purchase price is due in full.
With payments made in small increments, buyers will have installment payments on their mortgage that is more budget-friendly.
Click on this link to learn more about progressive payments.
- Appreciation of Capital
As the first owner of the property once it’s completed, you will be in the position to benefit the most from your unit’s capital appreciation in case you decide to sell.
There are two main reasons that make this so:
After the first buyer, subsequent ones would be paying a premium price on the unit as the previous owner would be asking more than the price they originally paid to make it worth their investment. When you buy at this premium price from the original owner and decide to sell later on, you will most likely have a selling price that is quite higher than those of neighboring units who have paid developer prices. You might possibly be forced to lower your selling price for the unit in order to make a sale, which means a shrinking profit margin.
The other reason is that lower depreciation from new launch condominium means you can have a high profit margin if you sell your unit, especially if you sell close to the date of completion. A new launch condo doesn’t suffer from asset depreciation because depreciation only applies when the project is completed. A tip if you go this route: if you sell, do so at least four years from when you purchased the condo so that you can avoid paying Seller’s Stamp Duty.
- More Options for Condo Units
When you buy a new launch condo, you have more options when it comes to the available units to choose from. You will have first dibs on prime units, especially those located on the higher floors that will have fantastic views. Whether you live in your unit or sell it, you win either way especially as prime condo units sell at premium prices.
- No Charge for Repairs
Having spent a significant amount on buying your unit, you would not want to be faced with additional expenses especially repairs. When you buy a new launch condo, your unit comes with fixtures and fittings that the developer provides as part of the sale, and these are covered with one year warranty to cover issues that may arise.
- Brand New Fixtures and Fittings, Pristine Facilities
One of the things that first time owners appreciate with their new launch condo units is the spanking new fixtures and fittings, and never been used facilities. Being the first user means not having to deal with maintenance issues. If you’re not comfortable living in a space where the fittings have been used before, or if you don’t agree with the aesthetics of a previous owner’s renovations, then a new launch condo is for you.
- Free Stuff and Discounts
As new launch condos are yet to be built, developers throw in a lot of freebies and discount vouchers as added incentive for people to buy their units. Examples of these would be reimbursements of stamp duty and VVIP discounts. For a lot more examples of promotions and deals that developers come up with to attract buyers, have a look here, here, here and here.
While the discounts wouldn’t go as low as getting a unit at half its regular price, the freebies and discounts offered are significant enough to make your purchase a really good deal.
Yes, you may have to wait for a couple years before you can move in if you buy a new launch condo. But with all the reasons mentioned above, a newly launched condominium unit is worth the wait.