Have you ever bought a new iPhone from a stall in a departmental store? Have you ever bought a new car from a roadside stall? iPhone is RM2,500 and you expect to buy it from a nice authorised Apple Store. Irregardless of the car brand, you expect a showroom as well as a test drive. Reason being, the cheapest new car is RM25,000 for a 660cc Viva. However, today, there are developers selling a condo worth over half a million RM using just one desk and two plastic chairs! Oh yeah, plus two pieces of leaflets which are stapled together and given to you , hoping that you will take up a mortgage loan of over RM500,000. I know, many of you would buy from such developers but as a principle, I would not buy from such a developer if they are selling their ‘luxury’ or ‘low density’ condo by having a desk and two chairs in departmental stores. Worse still, it’s in a hypermarket!
The typical marketing budget for any developer is between 2-5% of the GDV. This meant that they have more than enough to do real marketing. In fact, they have enough to build a real showroom of the condo for you to see the concept in real life. This is what they do in overseas market or the more established developers in Malaysia. Do you know that buyers from UK or Australia commented that Malaysians are really awesome because we are able to buy by just looking at a few pieces of paper?! If all buyers continue to accept this sloppy attitude from developers, of course even more developers would do the same. If the profit margin is way too little, no developers would build. Thus, please help to set a minimum expectations and ensure all developers do their best to attract us, their buyers and not the other way around, where we are persuaded to buy so easily without them doing any real effort.
Some developers are known to cut corners. Actually, the act of using just a desk and two chairs are normally what started this attitude of ‘never mind, they will buy’. Imagine, all buyers would only buy if the developers build showrooms to scale. Imagine, all buyers would visit many show rooms before deciding. Imagine all buyers asking them lots of questions and visit many developers before making decisions. FYI, until today most of the established developers would ensure majority if not everything is done right. Established developers does not need to be top 10 largest developers. I have known many smaller developers who take development seriously and build actual units and when their actual units were built, it was even better than their showroom unit!
Perhaps I am the minority but think seriously, united we can make things better. United we can help the developers to be more competitive, to pour more effort into what they do. After all, if they intend to be in the property development business for a long time, they should do the right things and not cut corners or costs. This is the reason why I visit property fairs. Oh yeah, some would then argue that due to this, the developers may increase their costs and pass them to buyers. This is definitely not true because their budgets have already included this when they planned the development. Would Malaysian developers be world class in the near future? Decision lies with buyers’ actions.
written on 20 April 2014
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