What is Platinum VIP access and how does it work? How is it that as soon as a new condo project sales center opens its doors to the public that a majority of the units have already been sold?
Often developers must sell 70-80% of all units before receiving construction financing from banks to begin construction. As a result developer offer purchasers discounted prices in order to receive the necessary financing from banks. For developers rather than spending thousands of dollars and time on advertising and waiting for the public to come to the sales center to purchase, they instead rely on Platnium Agents to sell up to 40-50% (sometimes more) of the units months prior to public launch. Every developer and condo project is different but a majority of the developers rely on Platnium VIP market.
Developers in Toronto generally follow a simple marketing formula for selling their buildings and it goes like this:
1) Friends and Family sales event (5-10% of units get sold)
2) Platinum VIP agents (30-40% get sold)
3) VIP agents (20-30% get sold)
4) All agents (10-20% get sold)
5) Pre-registrants (5-10% get sold)
6) Grand Opening to the public (last 10-20% gets sold)
With each step along this continuum, selection of units goes down & prices tend to go up (the hotter the project, the more the prices can go up) It might be as much as 6 months between the first friends and family event to the grand opening to the public.
Platinum VIP agents are the first group of people to get access to the building outside of the developer’s own friends and family. They are the ones who, in the past, have sold the most units for the developer and thus are awarded with first access, best prices and best incentives for their clients. Each Platinum agent is usually given a specific allocation of units in the building for which they have exclusive rights to sell to their clients for a limited period of time (usually 2-3 weeks).
There are over 45,000 real estate agents in Ontario but only a few hundred of them are True VIP Agents. Are you working with one of them? Feel me to reach out to us for any questions and or comments.