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The Tale of Two Sister Condos: How One Condo Made $431,000 While The Other Lost $186,000


Recently, we met up with a client who stays at Sea Esta a condo in Pasir Ris. During our engagement to understand his objectives, our client shared the background of why he bought his unit at Sea Esta.

In 2012, his friend (Lets call him "Mr X") and him were in the market to buy properties in Pasir Ris for their families. There were two projects launched in Pasir Ris at that time, Sea Esta and Ripple Bay, located side-by-side each other. With Ripple Bay being the more popular project.

Both projects are 99-years leasehold condos located in Pasir Ris and both projects TOP in 2015. Mr X entered the market earlier, and instantly bought into the hype of Ripple Bay. Soon later, Mr X met up with our client, and enticed him to buy a unit as well. But because there weren't suitable units in Ripple Bay, our client decided to settle for a unit in Sea Esta. (So that their families could still meet regularly)

Our client purchased his unit for $775 psf on 19 Oct 2012

And that brings us to why our client met up with us...

Our client said that Mr X recently sold his condo....BUT at a $186,000 LOSS!

So now our client wants to know, "What about my condo? Is it going to suffer such a big loss as well? And what options do I have?"

TRANSACTIONS IN 2017/2018

So we examined the data:

There was a recent transaction for another 1,119 sq ft unit at $1161 psf.

If based on $1161psf, our client would've gained $386 psf, which works out to be a $431,934 GAIN!

So a "second choice property", actually became a better asset.

WHY THE DIFFERENCE?

You might have heard of this before, "Buy property very easy, all about LOCATION!"

But with our above case of Sea Esta and Ripple Bay, we can clearly see its not just about location. And being on the field over the years, we have gained the knowledge and experience that there are other important factors that affect a property's price.

Some people say its all about the TIMING! But, both these properties were bought and sold in 2012 and 2018 respectively.

So whats the reason?

The First reason is the ENTRY PRICE. Mr X bought his Ripple Bay unit for $1,073 psf, while our client bought his Sea Esta unit for only $775 psf. The difference in the launch prices could vary for many reasons, one of which is definitely the hype and popularity of Ripple Bay during the launch.

Both projects were launched nearing the peak of a boom in the property cycle. Remember this, in a bullish optimistic market, almost anyone can make money. You just need to buy low and sell fast for a reasonable profit. Euphoria may often cloud the judgements of most people, be sure you are making decisions on Facts and Figures (NOT hype, emotions, rumours...etc).

In our current market, when sentiments are mixed, a right move means seizing and opportunity, but a bad move means making losses.

And that's why having experienced and knowledgeable consultants like us, will help you to navigate uncertain times like right now.

The Second reason is PRODUCT ANALYSIS. This is where experience strongly comes into play. Are you able to identify characteristics that make one condo better than another? Have you walked the ground of hundreds of condos to pick these subtle details? Do you have the experience to understand the market tastes as they change overtime?

This is one of the fine arts of identifying a property with good potential. And that is what we assist our clients to do. With our wealth of experience and knowledge, our clients have a "Property GPS" that tells them the best property for their needs and objectives.

CONCLUSION

We hope that after reading this, our readers will have a better understanding that conventional rules/ wisdom does not always apply when it comes to property. If it were true, then everyone would make money from buying properties!

But rather, being able to identify a good property that meets your unique needs and objectives, is an ART and also a SCIENCE. Both of which require experience, knowledge and time to develop.

They will always be many condo developments in the market, some new launches and others resale. With so many options in the market, how are you able to effective narrow down and decide on ONE that will potentially be highly profitable?

Buying a property is a big value transaction, it is advisable not to take a gamble on it. It is far more essential to seek out people who have the knowledge and experience to assist you with your decision making.

If you have any doubts, or are planning make an important property decision.....PAUSE. We would like to invite you to contact us for a non-obligatory consulation where we will share more insights to help make your decisions clearer and sharper.

Many Thanks

TeoDuoProperty

#propertyinvestment #growth #profits #CapitalGains #Loss #exitstrategy #knowledge #experience

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