You know what is the easiest way to make money for a property agent?

Just follow whatever the client asks you to do.

So this is a story of how I broke my own rice bowl to steer my this property buyer and a potential client… away from a bad property purchase.

This lady found me through my social media.

She was keen to purchase a ground floor unit. Why? She liked the idea of how it fits into her lifestyle.

With a big patio and yard, it can provide ample space for her dogs and easy for her to entertain guests who come to visit.

My Own Personal Experience With Ground Floor Units

In the past, I did manage to sell a ground floor unit.

However, it took almost a year to find a buyer who was willing to purchase the unit.

Why? The main reason is because such ground floor units attract a very small niche of buyers.

The main fact is that you are paying for large spaces like the patio.

But the patio is essentially “unlivable space”.

It is an outdoor location where people might use for gardening or maybe a place to sit back and relax. People use it in very similar way like a balcony.

The problem is this “balcony” is totally uncovered.

Most buyers out there are families who purchase for own stay.

Since they are going to pay a significant sum of money anyway, many choose to NOT pay for this “unliveable” space.

That being said, some buyers really love ground floor units and do actively look out for them.

The idea of not being dependent on the lift or having backyard views of the swimming pool is very attractive for this group of people. It is like a “landed home” experience.

But this is also a small group of buyers so it is much harder to find them to purchase your unit.

In any case, I thought since she seemed very keen. So I agreed to take a look at her shortlisted units.

So she sent over 2 listings that she liked a lot and asked me for advice on which one is a better choice.

Here was my analysis:

Choice A: 1496sqft ground floor unit at $1.73M

This was Choice A which is a 2-bedder unit with an asking price of $1.73M.

So I went to check out the most recent transactions of 2-bedder and 3-bedder units.

These 2 unit types will be the closest comparison to the size of this 2-bedder ground floor unit.

These was what I found out when I went to check out the average transaction value of the 2-bedder unit and 3-bedder units.

The average transaction price of 2-bedder unit: $1.416M

The average transaction price of 3-bedder unit: $1.738M

As you can see, to get a full fledged 3-bedroom unit, the buyer only needs to top up $8K.

The price gap between the ground floor 2-bedder unit and the 3-bedroom unit was too close to each other.

This really made the $1.73M asking price a bit too high especially since the unit only has 2 bedrooms.

Hence this makes Choice A a very questionable property purchase.

Moving on to the next listing which is Choice B.

Choice B: 1249sqft ground floor unit at $1.65M

This was the second choice where it was also a 2-bedroom unit with a huge patio space. The asking price was $1.65M.

Again, I analyzed the most recent transactions of the 2-bedder units and 3-bedder units.

The average transaction price of a 2-bedder unit: $1.436M

The average transaction price of a 3-bedder unit: $1.87M

Here you can see there is a significant price gap between the ground floor unit and the 3-bedder unit.

At the same time, the price gap seemed evenly distributed: $214K vs $220K.

So, to purchase a 3-bedder unit, my buyer has to top up $220K which is far more significant than $8K in the previous choice.

This means that the ground floor unit in Choice B is more fairly priced than the previous ground floor unit.

So essentially, Choice B will be the better option.

Conclusion

Buying a property is very easy actually.

But when it is time to exit and sell it off, it is not so straightforward.

That is why it is so necessary to purchase at the correct entry price so you won’t be stuck in the future.

By doing such price comparisons, it becomes that much easier to determine which is a better choice.

After all, we are not buying vegetables at the supermarket but the most priciest item in your life.

So, take the time to check with an experienced agent who can guide you on whether you are making the right choice.

In this case, the buyer decided to forgo the idea of buying a ground floor unit altogether and we are working to find other options that are more safer.

If you wish for me to analyze your own property choices, let me know.

Drop me a message via whatsapp to discuss further.

All our discussions are no-obligation.