New project sales galleries and their showflat are very quiet these days. At most times, there are only a handful of cars parked in front, most likely driven by the agents.
That is why we were in disbelief when the media told us that Hillhaven and The Arcady at Boon Keng drew 2,000 and 3,000 visitors respectively over their preview weekend.
Unfortunately, the first two 2024 new launches were a flop.
Over the first weekend, both new projects ended up selling only 50 units (before any returned units the following month). For face-saving, PropNex said selling 50 units in a new project is “encouraging”. When Huttons said it is a “good start to the year”, I wonder how other developers waiting to launch their project feel.
The best showflat ever
Anybody visited Haig Court’s sales gallery 20 years ago in March 2004? That was the best showflat I have ever been!
The developer was insurance company Great Eastern. They completed all 360 units in the project before launching it in the market. Interested in any unit? Just walk to the right block and take the elevator up to see the actual unit.
In a soft market, not a penny was wasted on building an expensive showflat – no artist impression, no imaginary layout, and no guessing game. What you see is what you get.
To attract prospective homebuyers, the developer also came up with fun and creative activities for the families. Famous hawkers in the east set up food stalls at the site for food tasting. There were game booths for the children. Families had fun playing in the swimming pool filled with sea animal-shaped floats.
At the end, we didn’t buy. But we really enjoyed visiting the showflat. It made such a lasting impression that I could still vividly recall the visit two decades later.
By the way, an ex-colleague told me that he was staying at Haig Court. After paying a visit to the showflat, he bought a big unit for his family on the spot. We shared the fond memories of the activities there years after going there.
The squeezed margins of developers
Like it or not, the private residential home market is very different now.
Before 2013, developers enjoyed a comfortable net margin of 20 to 35 percent. Ater 2013, it was down to 10 to 13 percent. Now it’s probably a single digit percentage!
“… report by Cushman & Wakefield mentioned that developers are paying an average of 29 percent more for residential sites over comparable sites sold in the past 5 years. In the 2nd half of 2016, developers were paying only 13 percent on average in premiums.
In 2009, developers’ margin stands at an average of 35.7 percent. It drops to 11.8 percent in 2014 and 4 percent for ECs.
– “Are Singapore developers forced to walk a tightrope?”, PropertySoul.com
Last week (January 18), a mixed development site in Marina South received just one bid. The submitted psf price from a joint venture of three local developers was 30 percent lower than a neighboring plot the government sold six months ago.
In recent years, rising developer ABSD, high borrowing cost and tepid market sentiment have lowered developers’ enthusiasm. Also, they have killed developers’ creativity in marketing new projects.
Although all developers spend minimum $2 million to build a sales gallery or a showflat, they are all monotonous. They won’t go beyond a project model, one or two showflats and a few discussion tables. Visitors can hardly tell the difference between one showflat and another.
Showflat in the future
Fortunately, anything not possible in real life we can have them in our dreams. Property investment is one of my hobbies. Sometimes I will dream of visiting a showflat or going for a flat viewing. And it is a blessing that my dreams always come with vibrant colors and many details.
Not long ago, I dreamed of visiting the showflat of a newly launched landed project. There was a walking underwater tunnel connected from a train station to the site.
After many developers went bust in various countries, under the pressure of consumers, governments finally banned the sale of off-plan or uncompleted projects. This landed project was fully built. I could follow the agent to see the actual houses in the project.
“Most owners of landed homes drive. Is it necessary to connect to a train station?” I asked the property agent.
“Drive? You mean that virtual game? Nobody drives in Singapore. If you want to drive, you can go for vacation in third world countries.”
“Then how do residents get around?”
“They can use train, driverless taxis, flying buses or flying taxis. They all have stops within 5 minutes’ walk from the project.”
We walked around the site. “Wow, beautiful! I like how this project was built with all houses facing either the sea or the lagoon.”
The agent looked amused, “Have you seen any house or apartment block in Singapore not facing waters ever since our sea levels rose?”
“By the way, you can park your boat right in front of your house. Just take note of the boat-lite policy. No riding on weekdays.”
Finally he said, “That’s the end of the viewing. Now follow the robots to the AI room. They will recommend the house, layout, interior design and financing option most suitable for you.”
Showflat with 360-degree unblocked view
Some time ago, I had another dream about flat viewing.
I went with a friend to see a condominium. It had already obtained TOP status but still had unsold units.
We played a small trick and managed to get past the property agents. Without anyone following us, we went straight to see the showflat – the one with 360-degree unblocked view advertised in the property ad.
With the door opened, we stepped inside and walked to the balcony. The unblocked view of Orchard’s skyline was impressive.
We found a round rotary switch on the wall. Slowly, we turned it 90-degree to the right. Then we felt the whole unit start moving gradually to the right. In a matter of seconds, we could see Singapore’s CBD and Marina Bay in front of us. Amazing!
We continued turning the switch to the right and had the full sea view of the East Coast out of the balcony. Next, we turned it 180-degree to the right. What appeared in front of us was Sentosa island. Cool!
But how could we have a 360-degree view?
I pressed the switch down. Suddenly, we felt the whole unit being ejected out of the block. What appeared above us was the unblocked blue sky. Under our feet, we saw the top of the trees and the whole project.
In my euphoria, I couldn’t stop playing with the switch to revisit all the wonderful sceneries.
“This is Bukit Timah Nature Reserve. Next, it will be Jurong Lakeside District … Now we are back to Orchard … Wait, let’s see Marina Bay Sands again … It’s there. Do you see it?”
There was no answer.
Then I turned around and saw my friend kneeling on the floor throwing up badly.
Check out my new online courses How To Buy Good Quality Properties and Buy The Right Condos.
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