What Are the Advantages of Buying a Preselling Property?

as published in Lamudi.com.ph

Also called off-plan properties, here are some of the benefits of buying real estate during its preselling stage

If you are an aspiring homebuyer who is actively searching for properties for sale in listing websites, or if you are actively on the rounds attending open houses, you have probably encountered the word preselling at some point. What is a preselling property and what are its advantages?

Preselling, or off-the-plan properties as it is more commonly known in the West, are pieces of real estate—either condominiums, townhouses, and house and lots—that are being sold by a real estate developer in advance before their actual completion.

While it may seem unconventional to a homebuyer to buy a property that does not yet exist (save for actual site where the property will be built and a blueprint), presold properties afford homebuyers many advantages, such as discounted prices and the first pick of the best locations and/or units. In this article, we have put together a list of benefits of buying properties while they are still in its preselling stage.

Preselling Properties Are Normally Cheaper

In the absence of the physical unit, preselling properties are normally sold at a cut-rate price of 30–50 percent off compared to the price of a finished unit. Aside from its affordable introductory price, many property developers offer flexible payment schemes and even discounted down-payment price for their preselling projects. These same developers also offer in-house financing in the event that the homebuyer fails to qualify for a bank housing loan.

They Give Buyers the Best Unit Options

When buying a ready-for-occupancy (RFO) property, more often than not, the buyer is usually left to choose from the less desirable units or locations. In buying preselling properties, buyers are granted a privilege to choose their ideal lot or unit location at an early phase, usually during the project launching stage. When buying a condominium unit during the project’s preselling stage, the buyer is given the opportunity to pick the best unit, such as those facing the best direction and located on the perfect floor, or even one of the best units that are normally reserved for repeat customers. Some condo units are just highly sought-after either because they offer great views or they come at the right size that are highly attractive to future renters.

Once Completed, They Can Provide a Steady Source of Income

Speaking of renters, once the property is completely done and is now ready for occupancy, the buyer can opt to rent it out, and through this, the buyer earns a steady cash flow. If buying a condo property to have it rented out after completion, it makes sense to buy a preselling one, especially during the project’s earliest stage, as it affords buyers the first pick of units—those that will be loved by future tenants. Alternatively, the buyer can also make more from his or her property by selling it once completed, by which time the property has increased its value.

They Are an Excellent Investment Option

The value of real estate, especially well-located ones, appreciates over time. This is true for preselling properties. At the time of their completion, the value of preselling condos or house and lots have increased considerably, that the buyer can earn a profit by selling them in the secondary market. It is not uncommon to see condos bought five years ago, especially those in Makati or Bonifacio Global City, for just over Php3 million, that can now fetch double this amount in the secondary market.

Some Tips Before Buying

As a smart homebuyer, you must be vigilant that any offer that comes with great advantages also carries some risks. One of the most drawbacks of buying a preselling property is that there is a chance that the developer you signed up with might back out from the contract and may not be able to deliver the unit at all. If you are unsure of investing to presold properties but does not also want to miss its perks, make sure to buy only from reputable real estate developers, those who have a good track record with delivering quality properties on time all the time.

This article was contributed by Camella.