Condo Launch Day: Is It The Best Time To Buy?
You may have heard of the advice:
“Be the first to snap up condo units on launch day for the best deals!”
If you’ve been shopping around and keeping that advice in your mind, well you’re not wrong. After seeing headlines like these below, it is hard not to follow the crowd.
Ballot Day Experience
I was physically there for the ballot at The M with my friend.
Trust me..the level of suspense and frustration were visibly sky-high to both buyers and agents.
With only 522 units available and over a thousand potential buyers vying for them, it is difficult not to feel the stress, especially with the low-hanging indicative prices attracting investors & buyers like bees to honey.
However, once the price list was released, it was clear that the developers had something up their sleeves. There was no way they would price too many of their units that competitively, particularly with such fanfare even at the onset of the Covid-19 pandemic.
The developers clearly had the upper hand here.
We waited anxiously for our ballot number to be called. But Lady Luck didn’t seem to be on our side that day.
Five agonizing hours went past, and units were flying off the shelves at astonishing rates, hitting around 50% sold at that point, yet our ballot number still disappointed.
It was apparent that the better deals were pretty much snapped up, and the remaining ones didn’t seem that much of a bargain at all.
It was obvious that my client was greatly reluctant to give up waiting, especially after spending five hours of our day here.
But I knew if we were to get called at this very moment, there is a very high chance that the overwhelming pressure inside would cause him to act on impulse and commit to an irrational buy.
Not a wise thing for the biggest-ticket item of our lives.
Eventually, we walked out empty-handed. Sheer disappointment on his face.
Somehow, our number got picked two hours later. Thankfully, my client didn’t look back.
Well, a blessing in disguise perhaps? Turns out…a few bounce-out units already on that very night. (aka buyers aborting the purchase)
We could have been those buyers, losing thousands overnight from just a hasty decision.
No Luck on Launch Day = No Hope?
Think about new launch sales as a typical retail shop.
Do prices climb when there is high or low demand?
Now let's examine the following transactions at two specific condos, (data from squarefoot.com.sg):
Condo A in Outside Central Region (OCR):
For Condo A, the 12th floor owner bought almost a year earlier than the 11th floor owner.
Take a look at the difference in pricing for just one storey below.
Can you imagine paying $69,000 higher than your neighbour to stay just one storey higher?
Condo B in Rest of Central Region (RCR):
Let’s get our eyes on the 17th floor of Condo B.
More than a year after this owner booked his unit, another owner secured his 2 floors higher on the 19th.
And he paid $68,000 lesser for the higher, more coveted view.
Now...how would you feel if you were the owner of the 17th storey unit?
So much for the early bird catching the worm…
Then again, some may argue..
“TT, what about those who do manage to snag the good deals on launch day?”
Yes I agree..occasionally buyers do get the best deals on launch day.
Unfortunately sometimes they end up being on the short end of the stick too.
At the end of the day, there are simply too many factors and variables on the launch day itself for every development to have a definite conclusion on that.
In my view, we always have two choices:
Rush in with the crowd on launch day & get exposed to overwhelming pressure to book a unit
Retain power as a consumer in an empty showflat & take your time needed for a rational decision
No right no wrong. It really depends on your perspective.
But what I am confident is that it does help to have a trusted, objective voice at the sides safeguarding your interests while you ponder over a big decision.
If you’re wondering what happened to my client-friend who missed out on The M?
Well..we ended up selecting a unit at a post-launch development after he took his time to rationally decide. Three months later, a similar unit of the same storey and facing in the block beside transacted at $40,000 higher than ours.
Now you do the math!