Due to COVID-19 many aspects of our lives have probably changed forever. The way developers launch their new projects to the public may also have changed for good — goodbye to endless lines outside of sales centres and eager buyers literally camping outside overnight (perhaps that’s not a bad thing?) and hello to online appointments in the comfort of your own home!
Here are some of the ways real estate developers have adapted to today’s unprecedented conditions.
First-clicked, first-served basis.
This is essentially a virtual “line up.” A specific launch date and time is advertised by the developer to their list of on-line registrants, usually accompanied by an email count down to the launch. Once the clock hits, potential buyers are then provided with a link to book their virtual, phone, or, in some rare cases, an in-person appointment. Those that are quick to click, get first dibs!
Another variation to this process happens when potential purchasers are instructed to send an email to the developer at a specific time. Then, the developer contacts everyone in the order that the emails are being received to give purchasers the opportunity to make their reservations.
A method we haven’t seen too often yet, but is bound to become more common is a bidding system. Not only does this system work well in this new virtual reality, but it also gives the developer an opportunity to maximize their profits in this red-hot seller’s market. Essentially, buyers are given a period of time to register their best offers using an on-line bidding system.
Signing of Sales Contract and Cooling-Off Period
Some sales staff will walk their purchasers through the signing of the sales agreement during their virtual appointment, insisting on getting a fully executed contract in hand on the spot.
Others will give the buyer a couple of hours to review and sign the contract after their appointment.
Typically, purchasers would be given 3-5 days to chat with their lawyer, financial advisor or mortgage broker. Recently we are seeing this time frame getting shorter and shorter, with some developers considering removing this cooling-off period altogether.
Instead, the buyers are provided with all of the information to review ahead of time, so that once they are ready to commit to a specific home during their appointment, it’s a firm deal. This of course only applies to freehold purchases — a 10 day cooling-off period is still mandatory in all pre-construction condominium sales.
With high demand and low supply, developers want to have 100 per cent assurance that they have a sale on their hands as quickly as possible.
Since most of the time purchasers are not there in person with a cheque in their hands some developers are now equipped to accept credit card payments online during the sales appointment.
Others will give purchasers a couple of hours to drop off a certified deposit cheque before returning the property in question back to the open market.
While this new way of business is very convenient, I do miss the chaos of a launch day!
Enthusiastic buyers knocking elbows in line while sharing stories about their families, framed floor plans hanging on walls with little green and red dot stickers, and the occasionally free glass of champagne… What’s not to miss?
My hope is that one day these new community project launches will become a hybrid of old and new.