Buyers don’t necessarily have to spend money on renovations for new homes, which can turn out to be a costly and messy endeavour.
Buying a unit at a project that has just obtained its TOP can be less stressful and less costly. We explore the advantages of ready-to-move-in properties.
By Joanne Poh
One of the biggest inconveniences about buying newly-launched property is having to wait years before being able to pick up the keys to your unit.
Buyers of TOP projects get to avoid this, as they are able to pick up the keys once they have made all necessary payments. They can begin to rent out the property or occupy it within a matter of weeks.
In addition, they are purchasing a property that already exists, rather than one that has yet to be constructed. This provides them with the opportunity to fully inspect the property before committing to a purchase. There is no need to worry that the finished product will fall short of what the showflat has promised.
While buying resale property also gives purchasers the above benefits, there are some distinct advantages of choosing TOP property over resale property.
Condition of the property
Whenever you purchase resale property, you are taking over a unit that has been used (and maybe abused) by previous residents or tenants.
This often means buyers of resale property are forced to deal with quite a bit of wear and tear. Fixing damaged or aged property often costs a considerable amount.
Inspecting a resale property is also trickier than inspecting a TOP project. You should spend more time inspecting the unit for damage. Look out for cracks, holes, stains or signs of water damage on floors, walls, tiles and ceilings, inspect electrical wiring, and check for leaks.
TOP property, being unused, is far easier to inspect. Defects in workmanship tend to be easier to spot in a brand new unit.
Minimal renovation works
Buyers of resale property often end up spending a tidy sum renovating the unit.
Other than rectifying any damage or wear and tear the unit might have suffered over the years, many also prefer to change configurations put in place by the previous owners, or erase traces of their questionable interior design choices.
Renovation works usually cost a hefty five- or six-figure sum, and involve the inconvenience of hiring and supervising contractors. They also prevent purchasers from moving in or renting out the property in a timely fashion, which can result in a considerable loss of rent.
In any resale property, there is also the danger of discovering somewhere down the road that the previous owner installed unauthorised fixtures or fittings, which you will then have to rectify at your own expense.
As TOP projects are brand new, little or no renovation is needed to prepare them for occupation.
One-year defects liability period
One of the biggest advantages of TOP projects is the fact that there is a defects liability period, lasting one year from the date the TOP is released.
During the defects liability period, the developers are contractually obliged to rectify at their own expense any genuine defects in the property. This means that buyers are practically guaranteed a unit in good working order.
On the other hand, resale properties are sold on an as-is-where-is basis, which means the purchaser is forced to accept the property in the state and condition in which it is found. Even if defects or damage are found shortly after the purchase has been completed, there is usually little the purchaser can do to be compensated.
No need to wait for transfer of ownership before being able to collect the keys
According to Wong Xian Yang, Head of Research and Consultancy at OrangeTee, buyers of TOP projects are able to move into their new units much sooner than buyers of resale property.
“As they purchase the property directly from the developer and the TOP has already been obtained, buyers should be able to acquire the keys very quickly. For a resale unit, they would have to wait for the transfer of ownership to be completed, which typically takes three to six months,” said Wong.
It sounds counterintuitive, but TOP purchasers can pick up their keys so quickly because they need not wait until the sale is completed. Completion only occurs when the Certificate of Statutory Completion for the property is received by the developers and ownership is transferred, usually years later.
Conversely, purchasers of resale property will need to complete the entire sale process and have ownership transferred before they can collect the keys.
Wider selection of property available
At times, buyers turn to TOP projects simply because there is a wide choice of available units at certain developments.
“Purchasers of resale property are at the mercy of whatever units have been put up for sale by their owners,” said Wong. “Depending on how many units are unsold in a TOP project, they may have a larger selection to choose from than they would on the resale market.”
It is not uncommon for there to be numerous unsold units in residential developments even at the TOP stage, which means that purchasers are spoiled for choice, with a range of floors and unit types open to them.
For those looking to buy occupation-ready property, it is a good idea to browse not only the resale units available on the market, but also to have a look at TOP projects in the same area.
Pricing
Resale property in Singapore can sometimes be more expensive than TOP projects. However, as resale properties are priced according to the wishes of their owners, this should not be taken as a hard and fast rule.
It is worth noting that on the resale market, there are many sellers who do not need to sell urgently and quote a high price just to test the market. On the other hand, TOP projects are priced by developers at set prices that are based on market conditions.
New homes come with the latest fixtures and fittings.
Modern fixtures and fittings
Fixtures and fittings become outdated quickly. One of the advantages of purchasing TOP property is that you are assured of brand new and modern fixtures and fittings. It is becoming increasingly common for developers to have high-end, brand-name fixtures, fittings and appliances installed.
Conversely, when you purchase resale property, the chances are higher that you’ll be dealing with outdated or obsolete fixtures and fittings that can be extremely costly to replace.
For instance, stoves and air conditioning units must be maintained, cleaned and occasionally serviced to remain in good working order. If the owner has neglected to do so, be prepared to have them replaced.
Freebies from developers
Developers frequently dangle freebies to entice buyers, and these are sometimes still available at the TOP stage. Buyers only stand to profit in the current sluggish housing market, as developers compete to drive better bargains.
Some examples of freebies include shopping vouchers, rental guarantees, and rebates, often amounting to a percentage of the purchase price. There have even been reports of developers enabling purchasers to buy cars at a five-figure discount.
Some even offer straight-up discounts on their units, which can become tens of thousands of dollars cheaper.
These freebies make TOP projects an even better deal than they might first appear, based on their sticker price.
Better design and facilities
The design of residential properties keeps getting more luxurious, and there is a distinct difference in the appearance and facilities of properties built decades ago and those of new developments.
Many older private properties look dated and lack the facilities that modern condominium or townhouse developments enjoy, such as Jacuzzis and saunas.
Conversely, developers these days face stiff competition when it comes to the design of their properties, which is why some new developments boast features like gardening plots, free cycling facilities, and enhanced swimming pool features like wavepools, saunas and even spa facilities. Even the more affordable developments are designed to look as luxurious as possible nowadays, and it is not uncommon to find common areas styled after tropical resorts.
Developers also recognise the importance of good views, and many new developments now boast scenic views from balconies and terraces.
This heightened emphasis on aesthetics is, more often than not, absent in older properties, and gives buyers another reason to pick TOP projects in favour of resale units.
Read the full TOP Special here.
 |
|||
 |
This article was first published in the print version PropertyGuru News & Views. Download PDFs of full print issues or read more stories now! | ||