Typical Luxury Showflat in Singapore

A typical luxury show flat in Singapore

The issue of show flats has seen some of the limelight recently, thanks to new government measures to curb developers in how they represent their products. This is in addition to their earlier efforts to do so. Basically, some regulations have been tightened, regarding doors and representation of a unit’s actual size, and the fines for breaching said regulations have been increased, from $20,000 to $100,000. Protecting buyers’ interests is the name of the game.

Before we go any further, let’s take a look at how show flats have evolved since the early days of Singapore property development.

In the early days, show flats weren’t even considered, as developments were marketed and sold after they had been built, so buyers could see an actual (bare) unit.

Subsequently, as developers became more competitive, they allowed early buyers to see the floor plan, and make a buying decision from there. In those days, buyers of such developments were a much more rarefied and savvy bunch, and could generally make an accurate assessment from just the floor plan.

Later, developers made an addition to their arsenal of marketing tools. They started rushing the construction of a few units, and setting these actual units up as show flats, complete with fixtures, fittings and other interior design elements. When combined with the earlier floor plan sales, the marketing push could be targeted at a greater spectrum of buyers.

New Condominium under construction, Adria along Derbyshire Road in Singapore

Adria, a new condominium under construction, along Derbyshire Road in Singapore

As marketing schedules accelerated and developers became more concerned with making sales even before the foundation was laid, specialised mock-up units started appearing. Only the largest and most exclusive developments would have these mock-up show flats, however, and they were generally very good replicas of the final product. Mostly bare, they might have had a few major pieces of furniture to give them a “lived-in” feel.

In today’s high-pressure, high-profit and high-capital property market, the need to lock in sales fast has given rise to such mock-up of units for almost every development with a larger number of units. The shift to a greater proportion of 99-year leasehold properties has also had an influence. The value of such properties simply don’t have the long-term staying power of freehold properties, so there is a rush to sell them as soon as possible. In addition, the rise of marketing has infiltrated the property market. It’s influence can be seen in brochures and advertisements where surrounding amenities and landmarks appear closer because the map is “not to scale”. More insidiously, such marketing tactics are built into the show flats too, in addition to the usual interior design elements. For example: 

  • Walls and doors are sometimes represented by glass or drawn lines, giving an illusion of greated space and light.
  • Balconies set up to look bigger than the actual, by exploiting planter box area or using lines to denote balcony boundaries, instead of railings and glass.
  • Show flat ceilings built higher than would actually be possible. A more sneaky variation of this is showing the actual full height (concrete) ceiling, but having recessed downlights or ceiling air-conditioner (which require a lower, drop ceiling).

 

We believe that any interior design elements, be they lighting, air-conditioning, fixtures or access portals such as doors and windows, must be representative of what is actually possible for an owner to do in the final unit that he purchases, not just an abstract approximation that over-emphasises the advantages while downplaying or even obfuscating the disadvantages. Not only that, it should be possible without requiring hacking work to be done on walls, floors and other structural elements.

Secondly, any fixtures and fittings that come as standard with a unit should be represented exactly in the show flat, instead of using premium or up-market replacements or materials that are not part of package.

We have also mentioned before, in this article, what buyers should be aware of in show flats, and when buying uncompleted developments in general.

We applaud the authorities for making it harder for the public to be misled. However, while additional fines and more stringent measures can help curb developers’ misrepresentation, we feel that another approach might be more beneficial to consumers. After all, who suffers when a buying decision is made based on an inaccurate show flat? Yet, when the developer is fined, where does the money go? How is the buyer recompensed for being misled into a million dollar transaction? In fact, one might even think that there is no incentive for the authorities to stop developers from using such marketing tactics, since that would mean more fines can be imposed.

Instead, we propose that developers be made liable directly by being forced to refund a buyer if he returns the unit on grounds that the show flat grossly misrepresented the size and features of the actual product.  A civil suit, filed in a court of law, preferably should not be required, in the interest of taking a more buyer-friendly approach.

For example, should a developer be found guilty of  infringing this new Housing Developers Act by the relevant authority, one of the applicable penalties would be to require the developer to publicly advertise and/or contact buyers that it has been found guilty of misrepresentation by the authority. Consequently, any relevant buyers would be given a certain reasonable period of time to return the purchased unit(s) for a full refund, possibly with other reasonable recompense (to be determined by the authorities). It is not unlike the recall of faulty products by manufacturer. This would truly protect the interest of the individual home buyer, who does not have the resources of a property developer to seek redress.

In a following article, Show Flats – Seeing Past the Glam, we’ll talk about how a buyer can be more savvy when shopping for a property via show flat. While developers have a large part to play in how accurate a show flat is, consumers too need to be prepared for the limitations of using a show flat to make buying decisions.

What do you think? Let us know, and share with us by commenting below or in our social media channels, FacebookTwitter, and Google+.

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