My personal opinion why if given a choice, I would buy from established developer? There are also so many other developers, whether they built the biggest, tallest, most spectacular or even cut corners all the time. Let’s focus on just the established ones today. Most of the time, for primary properties my first question to my friend when they asked me whether to buy or not is, ‘who’s the developer’. The reason why I asked is because of four reasons:
1) Less risk. Note that there is no such thing as no risk. Example, even if it is a SOHO project right next to Sungai Buloh but the established developer said that it is part of a huge integrated development with its own mall, offices and other residential components, I would believe it. Reason being this particular phase of the project may have a GDV of RM250 Million but their overall project GDV might be RM5 Billion! Seriously, would any developer fail a RM250 million project and risk being talked about and thus affected their remaining RM5 billion GDV projects. Just to add, Eco World reported recently that it will have a GDV of up to RM43.5 billion to keep it busy for the next 8-10 years.
2) Lower tendency to be ‘bad’ now. If you already have a good brand name, carries a premium and a loyal group of buyer followers, why start to be ‘bad’ now. You have no idea how hard it is for these companies to suddenly change their modus operandi to become one of those cut corner developers because they actually do not have to. Why? Note their premium? Thus, in terms of overall gross margin, their worry is much lower compared to newer and smaller developers who may not have the goodwill / premium and thus may be more prone to cut corners.
3) Expertise and design. Due to their sheer size, they can afford to hire much better people and this is reflected in their expertise and design. Have you been to a project where there were just too many corners or some corners in the house are just ‘useless’? I have been to condos where their living room is so huge. before you say, that’s their concept, let me tell you that their kitchen is nearly non existent and it can hardly accommodate one person frying an egg! I have also been to projects which despite their size being just 1,012 sf, I could not see the difference in it versus another ‘cut corner’ developer whose condo size was said to be 1,300 sf.
4) On Time Delivery. Don’t you just hate it when you receive your condo late? It is very rare for established developers to be late in their delivery. Reason being, if you are a contractor, would you rather work for these established developers who gives you project all the time or a small one which gives you work on and off? Personally, when I bought my condo, my colleague told me that she bought hers ONE year earlier. My condo was completed in slightly less than 3 years and her’s were completed only one year later! My sister’s condo was also completed nearly two years in advance compared to the condo I forced her to cancel. This is not a myth, even if not 100% of the time.
Actually there are still may reasons but it is ok, I think I have made my point clear. Should you buy only from established developers? Of course NOT. Haha. Buy when you have evaluated the project objectively. Buy after you have viewed the project show unit. Buy if you know that the developer’s Director himself is staying in the same place as the buyer! However, if you want to be nearly totally safe in your decision, buying from established developers may just be a better bet.
written on 27 April 2014
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