How to Spot A New Launch Condo Like A Winner in 2023?
You have read the articles and seen the videos of how new launch condos perform better than resale condos as property investments.
And it is true to a large extent. In fact, it’s such a perennial debate, we addressed it in a recent article, “New Launch vs. Resale Condo: Which is the Best Choice for Smart Property Investors?”.
Look at the numbers! There will be 10,000 – 12,000 new launch units in 2023.
The pent-up demand may boost new launch sales this year.
As such, my team and I have been busy working with our property investor clients to secure their winning investments during these few months.
Now that I have some time, I decided to consolidate and share with our readers, some key considerations I use to spot a winning new launch condo – for investment property purposes.
Table of Contents
Factors in Spotting A Winning New Launch Condo:
- Due Diligence
- Variety of Facilities
- Low Maintenance Fees
- Early Bird Discounts
- Choice of Unit
- URA Master Plan
- Integrated Or Pure Residential Developments?
Let’s get started.
To start off, we would always recommend doing sufficient due diligence on the developer and sub-contractors’ track record.
A simple Googling session will tell you more than you need to know.
Check if they have a good track record of developing similar projects, and if they complete the projects on schedule.
If you unearth complaints and lawsuits, that is a straight up red flag.
Variety of Facilities
One of the key perks of a new launch condo compared to a resale is the range of newer and more exciting facilities.
With the newer developments in recent years, we have seen developers out-doing each other consistently with introduction of better offerings – from dedicated concierge services, in-built smart home technology, karaoke rooms and even driving ranges (yes, golf driving ranges!).
From an investment property perspective, these could definitely increase the appeal towards a more discerning crowd of tenants and can probably garner you a higher rental rate.
While this can be an interesting appeal factor, do make sure to balance out with the possible higher premiums to pay on maintenance fees.
The general rule? The more facilities, the fees may be higher. The higher the fees, the lesser your returns.
So, do make sure to compare your shortlisted condos and see if the premium makes sense.
Low Maintenance Fees
We addressed it slightly in the previous point: the lower the better, so it doesn’t eat into your rental income.
The good news is, compared to most resale condos with similar facilities, it should be already lower, because of the absence of wear and tear.
Also, when considering the developments, do keep in mind that smaller developments where there are fewer units sharing the facilities tend to have higher maintenance fees. Tip: look at larger sized developments to keep the maintenance fees lower. After all, sharing is caring.
New Launch Early Bird Discounts – Time Your Entry
This is something you do not get when you buy a resale condo.
Many property investors prefer new launch condos because of the early bird discounts, “Star Buys” (more discounted rates from the developers) and freebies that could include furnishing discounts.
When you pick the right development, and time your entry right, these savings can range from tens of thousands to hundreds of thousands.
All of which will significantly improve your profit margin on the investment property right from the get-go.
So, when is a good timing? The initial phases are usually when many developers utilize the “Star Buy” strategy, heavily discounting units to spur on purchases and generate publicity.
The developers sell these units at a lower margin mean big savings for you
There are those who suggest that holding out to purchase closer to the ABSD deadline would have the developers slashing prices due to pressure to sell out – but the truth is we rarely see the pricing (PSF) come down that significantly after a project gains traction.
Also, practically, buyers who enter at that timing would also have less choice when it comes to the units available.
Hot Tip: If you find a new condo development that you are interested in, be updated for news on discounted units.
Choice of New Launch Unit
For buyers who plan to stay in the property, usually this is up to individual preference. But for investors, it always comes back to the numbers.
Is the additional premium worth the higher floor and better view? Is paying an additional $200 per square foot worth an unblocked view?
While premium views with unblocked skylines, lush greenery and more are typically well liked, they come with a premium price tag.
Make sure you consider an in-depth on price differences to make the right decision for your investment.
Hot tip: Consider other conveniences which could make a difference to potential tenants but not have such a significant impact to the pricing. For instance, proximity to access gates and facilities. Or being strategically located away from the bin centres, roads or communal bbq pits which could be potentially noisier.
URA Master Plan
One of the key resources for analysis of potential property growth and appreciation is the URA Master Plan.
We covered the details in a previous article – URA Master Plan – Understanding Growth Plans For Singapore Investment Property.
By understanding the upcoming infrastructure developments in the vicinity and planned residential developments, it is helpful to envision the potential growth for the property.
The URA Masterplan is not fixed in stone. Plans can and may change. It is nonetheless comforting to have awareness of potential developments.
Integrated Or Pure Residential Developments?
Integrated developments, as their name suggests, are an all-in-one hub for entertainment, food, groceries and residential units.
Sounds like an amazing offer in theory, doesn’t it? Again, remember that this is a checklist for property investors – so the question to ask is if it translates in terms of numbers.
Let’s take a look at a case study of 2 developments in Punggol: An integrated development Watertown (in conjunction with Waterway Point Shopping Mall and the Mrt) and a purely residential development Parc Centros (320m away).
Both were launched in 2012, just a few months apart. Now let’s take a look at how they have performed in terms of capital appreciation.
Over the same period of the past 10 years, Watertown has seen a gain of 16.44% in value whereas Parc Centros has seen a larger increase of 30.93%.
What do the numbers show? There is no real tangible benefit in picking an Integrated development over a purely residential development.
In fact, as an investor, it would be beneficial to invest a smaller sum (i.e. residential-only developments are typically cheaper than integrated developments), especially if the appreciation potential is similar.
New launch condo payment schedule
Buying a New Launch condo differ from buying a Resale Condo and the payment timeline can be confusing to many. So, we have come up with a New Launch payment timeline to guide you when you are buying a new condo.
New Launch Condo 2023
Connect with us for more updates.
We have assisted many clients with first-hand information.
In short, spotting a good unit is far more complicated than reading positive reviews or watching nice advertisement videos.
Be it buying for own stay or investment, due diligent homework should be done before making a decision.
Bonus for my readers
Are you in the market for a new condo in Singapore?
Don’t miss out on the latest new launch developments!
I can help you spot a new launch condo like a winner.
From analyzing floor plans and location to understanding developer track records, I’ll provide you with the insider knowledge you need to make an informed decision.
Contact me today to learn more and take the first step towards your dream home or investment property.”
Applying is simple – just hit that shiny “SCHEDULE” button.
Who should apply?
First-time property buyers who are looking for guidance on how to spot a new launch condo that fits their needs and budget.
Experienced property buyers who are interested in investing in new launch condos and want to know what to look for in a potential investment.
Property investors who are looking for ways to maximize their returns through purchasing new launch condos.
Real estate agents who want to advise their clients on the benefits of purchasing new launch condos and how to spot a good deal.
Anyone interested in the Singapore real estate market and the latest developments in new launch condos.
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Rick Long, Associate Division Director of Huttons Asia Pte Ltd, has been in the Real Estate industry for more than a decade.
He is driven, committed and is enthusiastic about real estate investments.
Today, he leads Team Youhome.sg, and together, he aims to provide his clients with the best experience in their property journey.
Well-equipped with expertise in residential properties, Rick often impressed his clients with knowledge of market trends, advising on timelines, financial calculations and best options for his clients.
Amidst the hustle and bustle, Rick enjoys quiet time and indulges himself in the intricate art of tea-brewing and teapot appreciation.
He would also take this chance to energize himself and reflect on his personal development and areas of improvement.
He is also a proud fur daddy to 2 rescue kitties and loves spending his free time with his wife and furbabies.
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