Tips and Guides

Property of the Week: Pre-Selling VS RFO

Licensed Broker Marc Ilagan answers the top three questions when buying a property


What is the difference between buying units at pre-selling stage and those that are ready for occupancy (RFO)? Learn the answers and other helpful hints before you buy a property.

Featured photos: Nostalji Enclave by Elanvital and Capital Commons.

Read the original article ("Whatever Your Style") in the April 2014 issue of Real Living Magazine. Download your digital copy of Real Living on the Real Living App now! Log on to for more details.

Take note of these handy hints:

What is the difference between buying units at pre-selling stage and those that are ready for occupancy (RFO)? 

 “The basic difference of pre-selling and Ready-for-Occupancy (RFO) properties are in their current availability to be used for their intended purpose. Pre-selling properties are those that are currently under construction.

These are offered with a payment term that is usually as long as the duration of the construction period of the property. Payments are mostly on installment basis. Ready-for-occupancy properties are those that have already been completely constructed and can immediately be used for their intended purpose upon purchase.” 

What are the pros and cons of getting pre-sold and RFO units?

“There are cost implications because of the difference in availability. Pre-selling properties are generally lower priced and are easier to purchase because of the payment terms offered. The downside is that these properties cannot be used right away, and the turned over units may differ from the original look presented to the buyer. Meanwhile, RFO properties are already complete. This means that what you see is what you get. Because the buyer can use it right away, you can expect that prices are higher.”

How do I earn from buying my pre-sold or RFO unit?

“A purchaser of a property can be an ‘end-user’ or an ‘investor.’ An end-user of a property uses it for his or her own use, while an investor purchases a property without the intention of using it. An investor can either rent it out or sell it for a profit. By renting out a property, the owner gets a steady stream of income as long as there’s a tenant.”


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