{"id":48435,"date":"2022-02-16T16:52:56","date_gmt":"2022-02-16T08:52:56","guid":{"rendered":"https:\/\/www.99.co\/singapore\/insider\/?p=48435"},"modified":"2022-06-13T17:57:57","modified_gmt":"2022-06-13T09:57:57","slug":"appeal-99-year-leasehold-landed-properties","status":"publish","type":"post","link":"https:\/\/www.99.co\/singapore\/insider\/appeal-99-year-leasehold-landed-properties\/","title":{"rendered":"What\u2019s the appeal of 99-year leasehold landed properties?"},"content":{"rendered":"
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When people talk about landed properties<\/a> in Singapore, whether it\u2019s semi-detached houses<\/a> or Good Class Bungalows (GCB)<\/a>, they often refer to the freehold<\/a> ones. Less discussed is the leasehold landed property.<\/p>\n

Most of the time when people buy landed property in Singapore, it\u2019s usually to allow different generations of the family to live together. There would also be plans for the house to be passed down to the next generations.<\/p>\n

That\u2019s not something one can do with a leasehold landed property, as the tenure usually runs for 99 years<\/a>. They\u2019ll probably be able to pass it down to their children, but the tenure may not be long enough for their children to pass it down to their offspring.<\/p>\n

On top of that, it would be harder to get a loan if it\u2019s a resale property with less than 60 years of remaining lease.<\/p>\n

But one major reason why people choose a freehold over a leasehold is capital appreciation.<\/p>\n

Leasehold landed properties don\u2019t enjoy as much price appreciation<\/b><\/h2>\n

Just like leasehold condos, prices of leasehold landed properties don\u2019t appreciate\u00a0as much as their freehold counterparts. Due to lease decay<\/a>, the property value will eventually decrease over time.<\/p>\n

Here\u2019s a look at the average price psf of freehold landed properties versus leasehold landed properties over the last 15 years.<\/p>\n

\"Price<\/a>
Freehold landed homes have a higher price appreciation than their leasehold counterparts.<\/figcaption><\/figure>\n

Prices of freehold landed properties have generally increased by a whopping 129.54%. In comparison, prices of leasehold landed homes have increased at half of the rate at 60.93%.<\/p>\n

In addition, the price gap between the two property types has gotten wider over the years. In 2007, the average price psf of freehold landed properties was S$647, while the average price psf of leasehold homes was S$616. So there\u2019s not much of a price difference at that time.<\/p>\n

However, 15 years later in 2021, prices of freehold landed properties averaged around S$1,484 psf, compared to leasehold landed homes at S$991 psf.<\/p>\n

This is one reason why less people buy leasehold landed properties. From the graph, we can also tell that the yearly transaction volume of freehold landed properties is usually twice of the volume for leasehold landed properties.<\/p>\n

Despite the lower price appreciation, there\u2019s still a select group of people that buy these leasehold properties.<\/p>\n

What\u2019s the appeal of leasehold landed properties?\u00a0<\/b><\/h2>\n

Enjoy a landed home experience at a lower price\u00a0<\/b><\/h3>\n

One major appeal of leasehold landed properties is the lower price.<\/p>\n

\u201cThe demand for leasehold landed homes in recent years is mainly due to affordability. Those in prime areas are much more affordable in terms of quantum as compared to freehold properties,\u201d Ray Teo, Advisory Associate Branch District Director at PropNex tells us.<\/p>\n

As mentioned earlier, prices of leasehold landed homes have generally been lower than their freehold counterparts. Last year, the average price of leasehold landed homes was S$991 psf \u2014 two-thirds of the average price psf of freehold landed homes.<\/p>\n

Nevertheless, as with any property purchase, price is not the only main factor.<\/p>\n

Ray shares that lifestyle needs and the need for space are the main driving forces of the demand for leasehold landed homes.<\/p>\n

With a lower outlay, owners can still have the landed home living experience, enjoying the bigger space and privacy these homes provide. Those with green thumbs get to have their own garden and backyard to grow their farms. And for those with pets, there is more space to play with them.<\/p>\n

So for those who need more space, and high-rise living is not suitable for them, leasehold landed homes can be a viable option. This is especially for homeowners who want to live in the house for the long term, who don\u2019t look into capital gains and are not looking to sell it. And they probably don\u2019t foresee themselves passing down the house to their children.<\/p>\n

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Leasehold landed properties for sale<\/h4><\/div>\n
See all listings<\/a><\/span><\/div>\n <\/div>\n
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\n \"Woodhaven\n <\/div>\n
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Woodhaven<\/div>\n
Woodgrove Ave \u00b7 D25<\/div>\n
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\n \"bedroom\"\n 4<\/span>\n <\/div>\n
\n \"bathroom\"\n 3<\/span>\n <\/div>\n
\n 839 sqft<\/span>\n <\/div>\n <\/div>\n
S$ 3,400,380<\/div>\n <\/div>\n
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