Developers’ and Agents’ Tactics at Launches & How to Win Big

Property launches are meticulously crafted events where developers and agents employ various tactics to maximise sales. These strategies are designed to create excitement, a sense of urgency, and, in many cases, fear of missing out (FOMO). As seen in recent successful launches like Chuan Park and Norwood Grand, these techniques can drive extraordinary sales, leaving buyers with little room to hesitate.

With the upcoming launch of Emerald at Katong, prospective buyers must recognise these tactics and learn how to navigate them effectively. This article explores the key strategies developers and agents use, how buyers can game these tactics, and why understanding them is crucial for making the best property investment decisions.

Price Escalation and the Perception of Scarcity

Case Study: Pasir Ris 8 – Gradual Price Hikes to Drive Demand

Pasir Ris 8 is a prime example of how developers capitalise on demand. During its launch, prices were increased incrementally throughout the day as buyers scrambled to secure units. The result? Buyers who hesitated early in the day ended up paying significantly more.

• Trick: Developers deliberately increase prices after gauging initial demand, implying that prices will only rise further.
• Why It Matters: This tactic preys on buyers’ fear of missing out, pushing them to make hasty decisions.
• How to Game It: Research the pricing trends of previous projects by the same developer. If you sense a clear upward pricing strategy, aim to secure a unit early. However, always remember to align your decisions with your budget and investment goals. Alternatively, you can wait to see if prices stabilise after the launch buzz dies.

The Hype Machine: Learning from Chuan Park & Norwood Grand

The stellar performances of Chuan Park (76% sold at launch) and Norwood Grand (83% sold at launch) highlight the impact of pent-up demand and effective marketing. Chuan Park benefited from being the first major launch in its area in over a decade. Norwood Grand leveraged the concept of ‘scarcity in a market ‘, a limited supply of new developments in a high-demand area, to attract buyers.

• Takeaway for Emerald Buyers:
  Emerald could follow a similar trajectory if developers effectively market its location, amenities, and pricing. It’s crucial for buyers to assess the project’s intrinsic value compared to similar developments to make informed decisions. Avoid rushing because the sales momentum is strong—evaluate whether the unit meets your personal or investment needs.

Exclusive Previews and VIP Showings

Example: CanningHill Piers – The Illusion of Privilege

At the CanningHill Piers launch, early previews were marketed as exclusive opportunities for select buyers. These events created a buzz, making attendees feel privileged and compelling them to act quickly.

• Trick: Exclusive previews are often more about generating excitement than offering true exclusivity.
• Why It Matters: Buyers who feel rushed by these previews’ “exclusive” nature may overlook critical details about the project.
• How to Game It: Attend previews to gather information, but don’t commit on the spot. Use the time to compare the development against competitors and assess its long-term potential.

The ‘Almost Sold-Out’ Narrative

Case Study: Treasure at Tampines – Misleading Availability

Treasure at Tampines, with its massive 2,203 units, was marketed as “nearly sold out” early in its launch. However, this claim primarily referred to specific unit types, while many others remained available.

• Trick: Developers create a false sense of scarcity to pressure buyers into acting quickly.
• Why It Matters: Rushed decisions often lead to buyer’s remorse, especially if better options become available later.
• How to Game It: Always ask agents for exact availability figures. Analyse whether the “sold-out” narrative applies to all unit types or the most popular ones.

Stacking Discounts and Inflated Prices

Example: Midwood Condo – Are Discounts Discounts?

Midwood Condo offered furnishing packages and discounts during its launch. However, some buyers later realized these “discounts” were factored into an initially inflated price.

• Trick: Developers advertise discounts and perks to make deals seem better than they are.
• Why It Matters: Buyers who focus only on advertised discounts may overlook whether they’re truly getting value for money.
• How to Game It: Request a clear price breakdown and compare it with similar developments in the area. Negotiate directly with agents to secure better deals without unnecessary extras.

Showroom Excellence and Unrealistic Expectations

Showrooms serve a specific purpose in the real estate industry. They are meticulously designed to impress, often featuring high-end furnishings, premium finishes, and carefully curated interiors. Some walls may be removed or replaced with mirrors to create the illusion of a more spacious layout, while strategic lighting enhances the overall ambience. These design elements are crafted to captivate buyers and elevate the property’s perceived value. However, it’s important to remember that the delivered units may differ significantly from the showflat, leading to unmet expectations.

• Trick: Developers design showrooms to create an aspirational vision that may not align with the units sold.
• Why it Matters? It’s crucial to understand that buyers who rely solely on showroom impressions may face significant disappointment when they receive their completed units. This is because some features showcased are for display purposes only. This cautionary note is to ensure you are fully aware of the potential discrepancies and the importance of cross-checking information.
• How to Game It: Always remember that the key to navigating the showroom experience is cross-checking the official floor plans and material specifications against what is presented in the showroom. This will help you make an informed decision and avoid potential disappointment.

The Impact of Over-Leveraging

Case Study: Buyers Caught in High-Interest Environments

During the high-interest-rate period of 2007-2008, many over-leveraged buyers needed help with repayments. Some were forced to sell at a loss, highlighting the dangers of stretching finances.

• Key Point: Agents often stress affordability, but it’s crucial to have open discussions about the potential risks of rising interest rates or unexpected financial changes.
• Why It Matters: Over-leveraging can lead to significant and potentially long-term financial strain, especially during economic downturns. This underscores the importance of careful financial planning and risk management.
• How to Game It: Use tools like mortgage and affordability calculators to simulate different scenarios. Ensure you have a financial buffer to manage unforeseen expenses.

Understanding Hype from Recent Success Stories

The sales performance of Chuan Park and Norwood Grand underscores the importance of market timing and pent-up demand. Both projects saw significant interest due to unique selling points, including location advantages and scarcity of comparable developments.

• Why It Matters for Emerald Buyers:
  If Emerald replicates this success, buyers could face intense competition for units. Understanding the pricing dynamics and assessing your budget early can help you navigate the launch effectively.

The ‘Future Value’ Narrative

Case Study: Jurong Region – Overstating Rental Potential

Developers highlighted future developments like the Jurong Innovation District to promise high rental yields in Jurong. However, the slow pace of infrastructure growth meant many investors overestimated returns.

• Trick: Agents push “future value” narratives to justify higher prices.
• Why It Matters: Buyers may end up overpaying for uncertain speculative gains.
• How to Game It: Use the URA Master Plan and historical rental data to verify claims. Focus on developments with clear, immediate growth potential rather than long-term promises.

10 Tips for Emerald and Future Launches: How to Secure the Best Unit

When preparing for Emerald’s launch—or any future property launch—it’s crucial to go in armed with a clear plan. Here’s how you can take control of your buying process and avoid common pitfalls:

Tip No. 1: Prioritize Research: Know What You’re Buying

Before stepping into the showroom or attending the launch, it’s crucial to thoroughly understand the property. Research Emerald’s location, nearby amenities, schools, and transportation options. Analyse how these factors contribute to its value, both as a home and as an investment.

• Pro Tip: Look up URA’s Master Plan for upcoming developments in the area. For instance, future MRT lines, shopping malls, or business hubs could significantly boost the property’s long-term value.
• For Investors: Compare Emerald’s location with similar launches to assess whether it offers unique value that could attract tenants.

Tip No. 2: Stay Disciplined: Don’t Let FOMO Dictate Your Decisions

The high-energy environment of a launch day can pressure buyers into making impulsive decisions. Getting caught up in the buzz is easy, especially if you hear that units are selling quickly.

• Pro Tip: Set clear goals before attending the launch:
  • Decide whether this purchase is for personal living or investment.
  • Establish a maximum budget, factoring in monthly repayments, taxes, and maintenance fees.
• Strategy: If your ideal unit is unavailable, consider waiting for future phases or exploring comparable developments. Rushing into a less-than-ideal purchase due to FOMO can lead to regret later.

Tip No. 3:  Leverage Tools: Use Calculators and Budgeting Apps

Understanding how much you can afford is essential, especially given fluctuating interest rates and evolving regulations. Use online affordability and mortgage calculators to simulate monthly repayments under various scenarios.

• Key Tools:
  • Affordability Calculator: Use tools that factor in Total Debt Servicing Ratio (TDSR) and Loan-to-Value (LTV) limits.
  • Progressive Payment Calculator: Estimate the financial milestones required for new launches. This helps you plan your cash flow during the construction period.
• Pro Tip: Ensure your calculations include hidden costs like Buyer’s Stamp Duty (BSD), Additional Buyer’s Stamp Duty (ABSD), and legal fees.

Tip No. 4: Monitor Pricing Trends: Look Beyond the Launch Hype

Emerald’s pricing will be carefully structured to maximise early sales momentum. Developers typically start with attractive entry-level prices for a few units to create buzz. Subsequent phases often come with higher price points.

• Pro Tip: Track how prices have evolved for nearby developments launched in the past year. This will help you gauge whether Emerald’s pricing is competitive.
• Strategy: Ask for the full price list and avoid focusing solely on the lowest-priced units showcased in marketing materials. Sometimes, slightly more expensive units offer better layouts or views that justify the premium.

Tip No. 5: Seek Transparency: Ask the Right Questions

Agents are trained to highlight a project’s best aspects while downplaying potential downsides. However, you’ll need to dig deeper to make an informed decision.

• Questions to Ask Agents:

  • Are there upcoming phases, and will prices differ?
  • What percentage of units have been sold, and which types are still available?
  • Are discounts or promotions available for certain units?
  • What’s the projected rental yield, and what assumptions is it based on?

• Pro Tip: If you’re unclear about any aspect of the property, don’t hesitate to ask for clarification. Transparency is your right as a buyer, and asking the right questions will ensure you have all the information you need to make a well-informed decision.

Tip No. 6: Timing Is Key: Attend Early but Stay Rational

Emerald’s launch day is likely crowded, with buyers eager to secure their ideal units. Attending early ensures access to a wider selection of units, but that doesn’t mean you should rush your decision.

• Pro Tip: Arrive early to observe how the launch unfolds. Take your time to assess available units against your pre-defined goals. If you feel pressured, step back and reconsider.

Tip No. 7: Compare Alternatives: Keep Your Options Open

While Emerald may be the current focus, there’s always a pipeline of upcoming launches. Monitor other projects offering similar features, amenities, or pricing.

• Pro Tip: Recent projects like Chuan Park and Norwood Grand highlight how competition among launches can benefit buyers. If a unit at Emerald doesn’t meet your expectations, exploring other new launches offering better value will leave you feeling informed and prepared for your decision-making process.

Tip No. 8: Build Flexibility into Your Budget

Unexpected expenses can arise, especially with new launches. Be prepared for additional costs like furnishings, renovation, or delays in completion.

• Pro Tip: Maintain a financial buffer equivalent to six months of mortgage repayments. This ensures you can manage any unforeseen financial strain.

Tip No. 9: Understand Developer Track Records

The developer behind Emerald has a reputation to uphold, but past performance is always a good indicator of future results. Research their previous projects to assess build quality, adherence to timelines, and after-sales support.

• Pro Tip: Visit completed projects by the same developer to gauge the quality of finishes and whether past buyers faced significant issues.

Tip No. 10: Capitalise on Opportunities from Early Success Stories

The impressive sales records of Chuan Park and Norwood Grand suggest that buyers are highly motivated when developments meet their location, pricing, and amenities criteria. For Emerald, this could translate into strong early sales momentum.

• Pro Tip: Use this to your advantage by preparing in advance:
  • Secure financing approvals before attending the launch.
  • Narrow down your preferred unit types to act quickly when your turn comes during balloting.
  • If you miss out, contact agents about potential re-issues or discounts on remaining units.

Conclusion

The recent successes of Chuan Park and Norwood Grand show how developers and agents masterfully create urgency and demand. Understanding these tactics is essential for making informed decisions as buyers prepare for Emerald and future projects where similar success can be achieved.

Ultimately, the key to winning at property launches is not just luck, but a result of thorough preparation, financial discipline, and a willingness to question agents’ narratives. By staying informed and focused, you can turn the developer and agent playbook to your advantage, ensuring a property purchase that aligns with your long-term goals.