WHILE house-buyers will look forward to the introduction of the build-and-sell concept, developers will dread such an idea because of its repercussions on the industry.

It will spell the end for most of the developers without the financial means to start their projects as it will also be too much of a risk for them even if they should get support from banks.

They have all along been conducting their activities with the subsidies of house-buyers who have to start paying for their units the day they signed the sale and purchase agreement.

The biggest uncertainty they face will be whether they can attract sufficient interest for buyers to purchase the completed units, which must be of good quality and finish or else it will just turn people away.

Unless they are well-endowed financially, few of them will be prepared to take the gamble as failure to sell their products could mean financial disaster for them.

Rather than take such a chance, the majority of them would prefer to just call it a day and leave the market to the well-established players who can last the course.

There is however a bright spot for those who can build their houses first before offering them to the public.

It will be possible for them to fix the prices of their goods at market rates at the last minute and therefore derive the maximum returns from their finished products.

The disadvantage of the present practice of sell-and-build is that the property prices are already fixed when buyers sign the S & P, as buyers must know the value of the houses of their choice.

However by the time the houses are ready for occupation, the price could have gone up quite substantially and the developers would lose out on this extra revenue for their products.

For this reason, many people are prepared to queue overnight to book units in new projects in order to make a profit later on.

This usually happens in projects located in prime areas where the demand is always greater.

In this way, the developers will be able to maximise their profits instead of the speculators who may make tens of thousands of ringgit by just re-selling their units to those who failed to obtain a unit during the launch.

Perhaps the biggest impact on the property market is that the number of houses built will drop significantly as there will be players who cannot compete with the big boys.

But one positive feature is that those who will drop out are likely to be the less committed ones who became developers because they felt that there was easy money to be made in this business.

Such new players are also likely to abandon their projects if there should be an economic downturn or should they run out of money before the completion of their housing schemes.