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Thread: West Coast site gets $176m bid

  1. #31
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    Quote Originally Posted by kingkong1984
    Possible right? Two ways, property wave go up and down. When best units launched first, u know it's going down.
    I just simply reply to your theory of selling from top floor with increasing discount, value will hold
    For example, assuming for a 20-story development, the average selling prices of 1-5, 6-10, 11-15, 16-20 floors are 850psf, 900psf, 950psf, and 1000psf
    if launch 16-20 floors first with no discount, 2nd phase 11-15 floors with 5% discount, 6-10 floors with 7% discount, and lastly 9% discount for 1-5 floors
    Buyers will see the price of this development is actually going down gradually when new phases are released, how can the value hold?

    As for property cycle up and down, this is a new variable that is not in your theory. In fact, with increasing discount, developers are actually signaling their desperation to sell , actually a negative sign
    Even if you take property cycle into the equation, when it is on the up trend, no need to give more discount, when it is along the down trend, value won't hold anyway since it is in the down trend

  2. #32
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    Quote Originally Posted by kingkong1984
    Possible right? Two ways, property wave go up and down. When best units launched first, u know it's going down.
    duplicate deleted

  3. #33
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    Quote Originally Posted by SpinCity
    I just simply reply to your theory of selling from top floor with increasing discount, value will hold
    For example, assuming for a 20-story development, the average selling prices of 1-5, 6-10, 11-15, 16-20 floors are 850psf, 900psf, 950psf, and 1000psf
    if launch 16-20 floors first with no discount, 2nd phase 11-15 floors with 5% discount, 6-10 floors with 7% discount, and lastly 9% discount for 1-5 floors
    Buyers will see the price of this development is actually going down gradually when new phases are released, how can the value hold?

    As for property cycle up and down, this is a new variable that is not in your theory. In fact, with increasing discount, developers are actually signaling their desperation to sell , actually a negative sign
    Even if you take property cycle into the equation, when it is on the up trend, no need to give more discount, when it is along the down trend, value won't hold anyway since it is in the down trend
    Take a spin..

    inflate it right from the start and then deflate it.

    U dun know the game?

    Everything start with base price. Let me show how here.

    Base price 10th floor. 1 million

    less 1% each floor.

    Base price 5th floor means less 5%

    Base price 2nd floor (as it excludes PES) means less 8%

    Then start the ball rolling.

    each floor add 1% instead and offer the 10th floor as preview prices.

    Hope u get it...

  4. #34
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    Quote Originally Posted by kingkong1984
    Take a spin..

    inflate it right from the start and then deflate it.

    U dun know the game?

    Everything start with base price. Let me show how here.

    Base price 10th floor. 1 million

    less 1% each floor.

    Base price 5th floor means less 5%

    Base price 2nd floor (as it excludes PES) means less 8%

    Then start the ball rolling.

    each floor add 1% instead and offer the 10th floor as preview prices.

    Hope u get it...
    You can spin spin spin
    you can inflat defalt inflat
    as much as you want, that's the developer's pricing strategy
    But the simple fact is, if a developer launches from top floor (the highest psf) with increasing discount, what buyers will see is the price is getting lower and lower, even they are inflated and then deflated, and the value cannot hold
    as what you suggested:
    your base price for 10th to 1st floor:
    1m, 999k, 998k, 997k, 996k, 995k, 994k, 993k, 992k, 991k
    your preview price
    1.01m, 1m, 999k, 998k, 997k, 996k, 995k, 994k, 993k, 992k,
    your base price is actually irrelevant since only the developer itself knows about it and the buyers have no knowledge about it. what really matters is the preview price.
    Now, the developer launch the 10th floor at 1.01m, as long as it can sell, fine
    then the developer launch 9th floor at 1m. what the buyers will see? they see the developer give a discount and they start to wonder why? why the greedy developer does not increase the price like all the other bullish developers do? Is this developer a NPO? or the developer is bearish? maybe next phase the price will be even lower
    Now, when the developer launch 8th floor at even lower 999k, this will confirm the buyers' guess that the price will just be lower and lower

    Now, as a buyer, will you go in catch the falling knife at 8th floor, or wait and see? you make the call

    As more and more caveats get lodged, what public will see is a ever lowering psf for this development

    Sorry to say that it is a failed marketing strategy as it not only fails to create a hype, but make buyers think twice before buying

    Can it hold the value? I seriously doubt

    Put it in another word: have you ever seen a developer done this before?
    This will only happen in certain industries, such as computer, mobile phone where the price is getting lower and lower ever
    Last edited by SpinCity; 26-06-11 at 21:19.

  5. #35
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    good reply...

    and very good comments too..

    agree that it is not likely in this industry.. I share on the possible strategies.

    This do happen just that U need a serious external event to trigger this..

    U see discounts after lehman saga right?

    Anyway by all chances... start with list price (market price upon top) and reduce discounts are more likely. FEO style.

    I like your post.. very serious but not personal.

  6. #36
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    Quote Originally Posted by kingkong1984
    good reply...

    and very good comments too..

    agree that it is not likely in this industry.. I share on the possible strategies.

    This do happen just that U need a serious external event to trigger this..

    U see discounts after lehman saga right?

    Anyway by all chances... start with list price (market price upon top) and reduce discounts are more likely. FEO style.

    I like your post.. very serious but not personal.
    Hahaha, didn't mean to be serious and glad that you don't take it personal
    no offense was intended, if there is any bit, my sincere apology

  7. #37
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    Quote Originally Posted by SpinCity
    Hahaha, didn't mean to be serious and glad that you don't take it personal
    no offense was intended, if there is any bit, my sincere apology
    No worries... I like to engage a debate based on arguments. U have my respect.

    Cool

  8. #38
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    Saw contractor erecting fencing around the site. FEO so fast preparing for launch liao?

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