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Thread: Luxury developer says no to offering discounts

  1. #1
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    Default Luxury developer says no to offering discounts

    http://www.propertyguru.com.sg/prope...ring-discounts

    Feb 8, 2013 - PropertyGuru.com.sg

    By Shabnam Muzammil:
    Following the latest round of property cooling measures in Singapore, many developers have been offering “incentives” to buyers in the form of discounts to offset the stamp duty hike.

    But builders of super prime properties have resisted such sales tactics. According to Alain Fanaie, Group CEO of China Sonangol Group, developments on “prime” spots do not need to attract buyers through such discounts.

    “We do not foresee developers who are holding very prime sites to discount as scarcity value will override other considerations and we certainly do not expect a compromise on the specifications to save on construction costs,” said Fanaie.

    The developer recently launched 21 Angullia Park, a luxury condo project comprising 54 apartments with units averaging S$4,500 per sq ft. Designed by SCDA Architects, the development is located at the junction of Orchard Boulevard and Paterson Road.

    It achieved a sales value of about S$60 million even before the official launch, with all the buyers so far being foreigners and permanent residents (PRs) from countries like Indonesia, Australia and Monaco.

    Meanwhile, Fanaie noted that Singapore’s residential property market remains very attractive to “high-net-worth foreign and local investors for its robustness”.

    “We feel that for the luxury segment buyers, an additional 5% ABSD (additional buyer's stamp duty) on top of what was introduced earlier (15% in total) should still be palatable as Singapore remains very attractive for its political stability, quality of life and safety.”
    Image: Artist's impression of the lounge area at the sky terrace - 21 Angullia Park

    Shabnam Muzammil, Senior Journalist at PropertyGuru, wrote this story. To contact her about this or other stories email [email protected]

  2. #2
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    Lets see whether this will prove to be a correct strategy or not in time to come

  3. #3
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    Quote Originally Posted by danguard
    Lets see whether this will prove to be a correct strategy or not in time to come
    TOP date 2014, latest must sell by 2016?

  4. #4
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    Condo in prime location does not need discount as long as the developer can hold. And also you must see whether the developer have a lot unit in hand. But in prime area the units are limited anyway... In the end, it all narrow down to interest rate as both property owner and property developer are now depending on the low interest rate to hold their unit. Also the resale market may be greatly affected with so much unit going to TOP in the coming 3 years.

  5. #5
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    I went to see quite a number of luxury condo recently.
    To share a particular one is The Marq, 6,000sf, asking $36m from the seller. The selller has been holding and refused to lower the price.

    And this is not the only one.
    SC Global holding Hilltops and The Marq
    KOP holding Ritz Carlton Residences
    Hong Leong Holdings has their Sage

    And all of them refuse to lower the prices.

  6. #6
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    For that group of buyers, maybe offering them a discount is an insult to them. Plus they risk incurring the wrath of the earlier buyers.

  7. #7
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    Quote Originally Posted by Laguna
    I went to see quite a number of luxury condo recently.
    To share a particular one is The Marq, 6,000sf, asking $36m from the seller. The selller has been holding and refused to lower the price.

    And this is not the only one.
    SC Global holding Hilltops and The Marq
    KOP holding Ritz Carlton Residences
    Hong Leong Holdings has their Sage

    And all of them refuse to lower the prices.
    ...i also went to see...but i see on propertyguru...
    In the final analysis.....its NOT whether you have a diploma,degree,masters OR PHD....its whether you have a HDB/PC/EC or LANDED...

  8. #8
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    Quote Originally Posted by Laguna
    I went to see quite a number of luxury condo recently.
    To share a particular one is The Marq, 6,000sf, asking $36m from the seller. The selller has been holding and refused to lower the price.

    And this is not the only one.
    SC Global holding Hilltops and The Marq
    KOP holding Ritz Carlton Residences
    Hong Leong Holdings has their Sage

    And all of them refuse to lower the prices.
    Laguna is indeed super high net worth!!!

    DKSG

  9. #9
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    Developers also behave like most private investors who can hold and have no intention to sell lower or at a lose. Most investors who have plenty of buffer will hold on and ride the storm. Developers are just doing the same thing.

    However, unlike investors, developers are subject to policy requirements (the need to sell within 2 years after obtaining TOP), tight cash flow, shareholders' pressure etc.

    Smaller developers with less buffer may have to sell to survive. Listed developers may want to reduce prices to clear inventories and show better balance sheet. Some may prefer to cut losses and take the money to invest elsewhere. There are a lot more business decisions to sell or not to sell unlike private investors.

    The selling pressure will only surface with time.

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