An existing unit on the subsale market? Or a brand-new unit under construction from a developer?
More often than not, this is the first decision you would have to make as a homebuyer. Picking either one or the other would have a significant impact on the outcome, regardless if it’s for investment or for your own stay.
This is due to the fact that our under-construction properties practice the “sell-then-build” concept, which collects payments and loans before proceeding with the construction. Today, we will explore what exactly are the differences, and how it may influence your purchasing decision.
Pros and cons of subsale properties
| Pros | Cons |
|---|---|
| What you see is what you get | Higher upfront cost for immediate repairs |
| Accurate rental rates | Missing out on developer incentives |
| Ready to rent / move-in condition | “Used” condition |
| Ability to negotiate / Strike deals |
Having the option to know the existing rental rates of a subsale property can play an important role when it comes to investing, allowing the owner to plan out the finances and calculate their returns on investment.
Unlike under-construction projects, what you see is definitely what you get. Homebuyers are able to prospect the property properly, having a clearer understanding of the layout of the house, and the costs needed for repairs and furnishing.
Different sellers have different reasons for letting go of their property, so be wary if a certain property is being sold way below market value. Conversely, if the owner urgently needs to liquefy their asset as quickly as possible, you have just gained the upper hand, and might have landed yourself on a great deal!
Pros and cons of undercon properties
| Pros | Cons |
|---|---|
| Developer incentives | Level of uncertainty |
| Fresh start (no historical rental data) | Financial lockup |
| Ready to rent / move-in condition | “Used” condition |
| Brand new condition | Rental competition |
| Longer waiting period |
While you are able to negotiate with sellers to get a better deal, it is hard to ignore the lucrative deals provided by the developers in the first place. Some units do come fully-furnished, some provide waivers on legal fees or stamp duty fees, potentially making developing projects a much better deal. Note: Enjoy several exclusive discounts offered directly by developers, only at Ohmyhome.
For newly constructed projects, you set the benchmark when it comes to selling and rental prices. Conversely, you will face heavy competition from other investors looking for tenants, and it may take about three months or more for the prices to correct itself.
If you are looking to secure property via a loan, be mentally prepared to be financially locked up during this period of time before you can even get to experience living inside the home. Patience is the name of the game, and once your home is completed two or three years down the road, you will have your keys to your brand new home!
Ultimately, the decision to buy which property entirely depends on the goal of the property itself.
Are you looking for a rental investment property to grow your net worth? A subsale property might be more suitable for you to plan and calculate your finances. For young couples who are looking for a place to call home and grow a family? A newly constructed property might be something to look out for.
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Our deals are exclusive, directly from property developers themselves, and you can be sure that there are no duplicate listings on the Ohmyhome platform so that you can have a clear overview of all the options available to you!
Don’t know where to start? Call +60 16-299 1366 to get in touch with our dedicated customer service today!
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