Buying from a Developer

Dear All,


I am thinking of buying (first timer ofcourse) from the delevoper.


What are the advantages in this (buying from developer) compared to buying from the secondary market?


I can think of the following:


- Everyhting is brand new wont be a "cursed property"

- Incentives like waiver of Solicitor fee's/Estate agency Comm

- It may be a bargain (developer wants to sell)

- The dealing is more straighforward, no need to run around looking for approval from lenders and worrying about paperwork losing ur deposit.


I would appreciate your views/feedback



Regards,

lalib. Buying from a developer has a few advantages but you will always pay a big premium over the secondary market (say 40-50%). I know this sounds ridiculous but there is a lot of appetite for new buildings in HK because 1) they are very easy to trade 2) they are new and have facilities and 3) the bank is normally lined up to give you a mortgage. Can you tell me which development or area you are looking at? Some areas are more popular than others. As a general rule of thumb, in Hong Kong convenience always beats lifestyle. Also, the local school network is important which favours Mid-levels in HK and Ho Man Tin/ Kowloon Tong in Kowloon. Check the secondary market developments close by on http://www.centadat.com and where they last traded. Also, the developer is important. For mass residential, the best developers are Sun Hung Kai, Henderson and maybe Cheung Kong (though the shapes of the flats are quite strange in Cheung Kong developments). These are well-known developers and have a natural following. Second tier are Chiense Estates (quite good), New World (furnishings not so good) and Sino Land (not so tasteful). I would avoid Asia Standard and other small developers. Luxury developers HongkongLand is very good. Kerry Properties is good but should be better for the price. I wouldn't buy new property in Tseung Kwan O or DB as you can probably get something close by much cheaper in the secondary market.

Hi LGMV,


Thanks for the info.


I was actually thinking about DB the new buildings that are being built part of Chianti. These should be easily ready within 6 months from now.


My reasoning:

1) DB aint that fast moving property wise compared to rest of HK

2) There is already plently of flats already empty or on the market to be sold - even in Chianti (constructed 4 years ago)


I was just thinking that buying a property from the developer would be the way to go. I thought it would be cheaper (with the incentives - if any)


If not then like you mentioned there is always the secondary market in DB.


regards,

2) There is already plently of flats already empty or on the market to be sold - even in Chianti (constructed 4 years ago)


that's an indication that the secondary market prices will be much cheaper than 1st hand. . .


sorry but i think chianti new apartments will be too overvalued when you buy them first hand. just ask all the owners who bought chianti apartments in the existing towers and ask them how much money they lost (or didnt gain) while other areas recovered nicely

Also, I'm not a big fan of the developer HKR. Look at the quality and finishings of the flats with DB compared to elsewhere in HK. They have a monopoly in DB. If you want to buy, maybe you should look at http://www.centadata.com If you look at the home page, it has the names of benchmark housing estates in HK. Now they may not be to your taste but the market is very transparent and liquid and it's fairly easy to get a tenant or sell when you need to. However, if you love DB then I would follow Cooki09's advice.

The legal procedures are more or less the same, the most important consideration is the price of the property.



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