Property Talk: A weekly column by S.C. Cheah
IT must be every developer’s dream to have people gate-crashing or camping outside their sales office just like the recent report about people queuing for five days to buy houses in Kemuning Utama.
However, such incidences be they genuine or part of a marketing ploy to make people jump onto the band wagon are more the exception than the rule as it is still a buyers' market and purchasers are spoilt for choices.
Competition is so keen these days especially in the Klang Valley that all sorts of free gifts, discounts, incentives and sales gimmicks are thrown in to push sales. Despite all the goodies, some developments are still not fully sold.
Some projects have been re-launched again and again until the houses have been completed but the developer would say that they wanted to build first and sell later. There are also abandoned projects that had been revived more than twice under different players and concepts but some of their sales are sluggish due partly to lack of public confidence.
The fact is things are not as rosy as they seemed although projects in “hot” locations are still doing well. It’s not because people are not buying.
On the contrary buying a property has never been easier what with developers building nice show houses and sales galleries to exhibit their products to the fullest. There are great offers from developers and banks alike.
Sales charts decked with red pins often display the “fantastic” sales. You are told that there are “very limited” units left. However, when you demand for a particular unit that is purportedly “sold,” the sales personnel may later inform you that a purchaser had dropped out as he had failed to qualify for a loan so would you like to grab it?
Although the freebie mentality has been very much entrenched in the Malaysian psyche and has become a kind of “buying culture”, the serious and astute purchaser still looks beyond short-term gain. They bought because they knew the product was good and has value for money.
As Titijaya Group senior sales and marketing general manager Joyce Sin said: “Our products can sell by themselves but we give discounts to reward our loyal purchasers, especially those who have registered their interest with us from the start.”
Indeed, its proposed Tiaraville serviced suites in Subang Jaya had been well received, with 95% of the Block A sold in three weeks. During the recent Mapex 2005, the group offered discounts up to RM5,000 per unit for the new Tiaraville block and up to RM50,000 discounts for purchasers of its three-storey shop offices in Klang Sentral. It managed to close quite a number of sales.
The MK Land Group also threw in some attractive offers for buyers of its Milan@Damansara Perdana designer condominium. It gave a special 10% discount and another Mapex special discount of 5%. Bumiputra purchasers get to enjoy a further 7% discount. Also waived were the fees for sales & purchase agreement (SPA) and loan documentation. There is also one free car park bay.
Those who bought The Boulevard condominium units in Subang Jaya during Mapex 2005 were also given a RM8,000 rebate.
Purchasers of link houses in Kota Warisan also got discounts ranging from RM3,000 to RM10,000 during the four-day property fair. They were also entitled to lucky draws where the prizes include RM3,000 to RM10,000 cash, a further RM3,000 discount, a 29-inch television set, a two-door refrigerator, two units of 1hp air-conditioners, a washing machine and an automatic swing gate.
Even after Mapex, some developers like Harum Intisari Sdn Bhd continue to offer cash rebates for purchasers. During its “Eastern Rhythms” event last weekend (where wushu and hands percussion performances were held to woo the crowd), a special rebate of RM8,000 was offered to those buying the bungalow land/bungalows at Bandar Botanic that boasts of many nice water lily ponds and landscaped gardens.
There was a RM6,000 rebate for those buying the semi-detached homes, RM2,000 rebate for the two-storey link homes and Crescent Lake Terraces and RM500 discount for the medium-cost apartments in the township.
Agenda Istimewa Sdn Bhd is also offering a RM5,000 cash rebate for buyers of its completed terrace houses in Kesuma Lakes.
Although cash rebates remain a strong incentive, people are still drawn by the typical freebies like the free set of kitchen cabinets with hood, cooking hobs, refrigerators and window blinds for buyers of homes in Bandar Mahkota Cheras.
Another form of incentive is the guaranteed rental return (GRR) that is proving to be very popular. Buyers of the newly launched Seasons Square in Damansara Damai are offered a 6.5% GRR for two years.
Some developers also include a kind of cash back or pay back scheme that is akin to an endowment policy with an insurance company.
For example, purchasers of the Lavender Heights bungalow project in Senawang, Negri Sembilan, are being offered a Property Reward On Financial Investment Tenure or P.R.O.F.I.T. plan where there is potential cash back of up to 200% of the property value.
One of the most attractive GRR appears to be the 9% GRR for 10 years for purchasers of the One Subang serviced apartment in USJ1. The developer Casa Andaman Sdn Bhd has proudly advertised that its Block A was fully sold in just 30 days!
Apparently, one of the reasons for the good sales of this block is that it is under the GRR scheme. This block would be used as a hostel for students of Prime College located at Summit USJ. The college’s new building is under construction next to Summit USJ.
Buyers will also enjoy a potential yield of up to 100% of the purchaser price under a 35-year investment link programme.
They will also get free mortgage reducing term assurance coverage for four years, free legal fees on SPA and bank loan agreement and a free car park as well as a fully furnished unit.
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