Should I Buy Freehold or Leasehold Property?

Should I Buy Freehold or Leasehold Property?

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When buying property in Singapore, one of the biggest decisions you’ll face is whether to invest in a freehold or leasehold property. This isn’t just a matter of ownership terms—it affects resale value, legacy planning, maintenance costs, and even your emotional connection to the home.

In this guide, we’ll break down everything you need to know in a clear, easy-to-understand format. By the end, you'll have a solid idea of which option suits your goals best.

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What Is a Freehold Property?

A freehold property gives the owner permanent ownership of the property and the land it sits on. In Singapore, freehold titles usually come in the form of Estate in Fee Simple or Estate in Perpetuity.

Key characteristics:

• Ownership does not expire

• Passed down through generations

• Often considered a better long-term investment

• Higher price tag compared to similar leasehold properties

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What Is a Leasehold Property?

Leasehold properties in Singapore are typically granted on 99-year or 999-year leases, with the 99-year being the most common. The government technically owns the land and leases it to you for the specified term.

Key characteristics:

• Ownership reverts to the state after the lease ends

• Cheaper than freehold properties

• Can be upgraded through en bloc or lease top-up (though not guaranteed)

• Popular among younger buyers or investors with short- to mid-term goals

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Pros of Buying a Freehold Property

1. Permanent Ownership
   You never have to worry about the lease expiring or renewing.

2. Better Legacy Value
   Ideal if you’re planning to pass the property down to your children or grandchildren.

3. Higher Resale Potential in the Long Term
   Buyers tend to favor freehold units, especially in a resale or en bloc scenario.

4. Emotional Security
   Owning the land provides a stronger psychological sense of security and control.

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Pros of Buying a Leasehold Property

1. Lower Initial Cost
   Leasehold properties are generally 20-30% cheaper than similar freehold units.

2. Newer Developments
   Most modern condos and HDB flats are on leasehold land, giving you newer amenities and layouts.

3. Better ROI for Shorter-Term Investors
   If you’re looking to buy, rent out, and sell in 5-10 years, leasehold might make better financial sense.

4. Government Housing Supply
   Most government-supplied homes (like HDBs) are leasehold, making them the go-to option for first-time buyers.

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Freehold vs Leasehold: Which One Should You Buy?

1. Your Budget

If you’re working with a tight budget, leasehold properties offer better affordability and more choices. Freehold units in prime areas can be extremely expensive.

2. Purpose of the Property

• Own stay & legacy planning → Freehold

• Rental income or short-term capital appreciation → Leasehold

3. Location

Sometimes, a 99-year leasehold condo in a prime location (like Orchard, Tanjong Pagar, or Pasir Ris) may offer better returns than a freehold unit in a less central area.

4. Exit Strategy

Freehold may offer better long-term resale value, but leasehold properties can offer quicker liquidity due to more active demand in the mass market.

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What About En Bloc Sales?

Freehold properties are often more attractive for en bloc sales, as developers do not need to spend money renewing land leases. That said, leasehold properties in desirable locations can also command high en bloc prices.

Key Insight:
Leasehold en bloc tends to be more time-sensitive, especially if the lease is below 60 years.

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Common Misconceptions

• “Freehold always appreciates more.”
  Not always. Location, demand, and market conditions matter more than tenure.

• “Leasehold properties are bad investments.”
  Not true. Many leasehold condos have outperformed their freehold counterparts in ROI due to better locations and newer facilities.

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Case Example: Boulevard Coast EC

Located in Jalan Loyang Besar, Boulevard Coast EC is a 99-year leasehold executive condominium offering excellent amenities and connectivity. Even though it's leasehold, it offers high value for money and strong investment potential in the Pasir Ris area.

This is a perfect example of how leasehold can still be a winning choice, especially for younger families or investors looking at 5-15 year horizons.

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Final Thoughts: Which One Is Right for You?

There’s no one-size-fits-all answer. Your ideal choice depends on your financial goals, lifestyle needs, and long-term plans.

Choose Freehold if:

• You want to keep the property in the family

• You prefer emotional security in permanent ownership

• You can afford a higher upfront price

Choose Leasehold if:

• You want to maximize value within a specific budget

• You plan to move or upgrade in the future

• You prefer modern facilities and newer developments

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Quick Summary Table

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In conclusion, both freehold and leasehold properties have their strengths. Think carefully about your needs, consult with property agents, and evaluate each property not just by tenure, but by location, layout, amenities, and growth potential.

Whether you go freehold or leasehold, the key is to buy smart and plan ahead.

Important Links Boulevard Coast Boulevard Coast EC Boulevard Coast Showflat Boulevard Coast EC Showflat Boulevard Coast Jalan Loyang Besar EC Expat-Friendly Neighbourhoods in Singapore waterfront property in Singapore Discover the Best Luxury Condos in Orchard Road Singapore New Condos in Bishan Singapore How to Buy a Condo in Singapore as a Foreigner Boulevard Coast Boulevard Coast EC Boulevard Coast Showflat Boulevard Coast EC Showflat Boulevard Coast Jalan Loyang Besar EC Pasir Ris EC Boulevard Coast EC Showflat Boulevard Coast Jalan Loyang Besar EC Jalan Loyang Besar EC Pasir Ris EC

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