Your search results

Unveiling the Truth: Why Freehold is Not Always the Optimal Choice for Property Investment

Posted by Jayson Ang on January 4, 2023

| 0

TLDR

When it comes to investing in real estate in Singapore, traditional beliefs may not always hold true in today’s rapidly transforming market. Property agents now rely on digital platforms like Facebook and PropertyGuru rather than classified ads. While owning a freehold property may be beneficial for long-term investments, newer 99-year leasehold properties could be smarter choices for mid-term gains. Being near an MRT station isn’t always the best option, as other factors like entry cost and specific product choice play crucial roles. Additionally, the belief that the next-door resale condo is a bargain may not always hold true, as seen in the comparison between J-Gateway and Caspian properties. The property market is ever-changing, challenging long-held rules and expectations. To navigate this dynamic market, staying flexible and open-minded is key. Gain more clarity on property investments by scheduling a financial assessment session.

When it comes to investing in real estate in Singapore, there are several so-called “rules” that seem to dictate certain choices. These “rules” have been around for ages, based on certain “beliefs” that have been passed down or shared through word of mouth.

Do These “Guidelines” Still Hold Weight in the Present?

In this era of rapid transformation, what worked before is no longer successful. Ten years ago, property agents could rely on classifieds ads to generate buying inquiries, but now they have to take their listings to the digital realm of platforms like Facebook and PropertyGuru in order to get the most exposure. The Classifieds section has become a shadow of its former self. Ultimately, it has become outdated and superfluous.

Are You On The Cutting Edge…Or Stuck In The Past?

As I challenge some long-held beliefs cherished by some, how will you react? It is natural to be averse to change, yet here I am offering readers of this blog 3 property investment beliefs that may be past their prime.

Investment Belief #1: Owning a Freehold Property in Singapore is a Far Superior Investment than Leasehold

Have you ever asked yourself if Singapore freehold properties are better than leasehold? Well, I hear you cry as you ponder this debate – but, trust me, I walk the ground daily, witness transactions and have exclusive data unavailable to the general public.

Take Bartley Ridge as an example: a 99-year leasehold condo that saw multiple transactions in 2018. So is the belief in freehold investments outdated? Absolutely not – it is still highly relevant!

Bartley Ridge (Leasehold) : 2018 Transactions

Bartley Ridge psf Pricing Trendline

Let us take a look at Oasis Gardens – a freehold development nearby– and make a comparison.

Oasis Gardens (Freehold) – PSF Trendline

The PSF pricing for this freehold development has decreased, leading to fewer transactions taking place as owners purchased at higher prices and are unwilling to sell at lower prices. The trendline is evident, with a slight decrease and a lack of significant movement. If you’re seeking a property investment for the long-term, a freehold property may be the most beneficial option; however, for a mid-term period (3-8 years), a new 99-year leasehold property may be the smarter selection.

Investment Belief #2: Buying Near MRT Is Better

It’s often said that choosing a spot close to an MRT station is a wise move, and I have to agree – in many cases, being in the vicinity of public transport has its advantages. Nevertheless, I’ve come across instances where this is not necessarily the case.

The Quartz (near MRT) vs Riversails

Below are the Riversails’s most recent transactions:

Riversail 2018 Transactions (Further away from MRT)

Riversales psf Trendline

Let’s take a look at the Quartz PSF trendline.

Take note the Quartz is located nearby Buangkok MRT station.

The Quartz PSF Trendline (Near MRT station)

Living close to a MRT station may not always be the best and safest option when it comes to investing. Location alone is not a surefire way to guarantee success – there are other factors that must be taken into account, such as the entry cost of the investment and which specific product to buy (when there are a variety of options in the same area).

Investment Belief #3: The Next Door Resale Condo is a Bargain!

I recently had the pleasure of connecting with a couple who were curious about the current state of the property resale market, so let’s take a peek at the resale property price index!

2013 was the pinnacle of sky-high prices, with J Gateway launched that June, boasting an average PSF of a staggering $1650. I couldn’t believe it – it was just too expensive. The timing was unfortunate too, coming right before the 2013 cooling measures. J Gateway was released and sold at the most exorbitant rate. Fast forward to the present day, let’s take a peek at J-Gateway’s most recent transactions.

J-Gateway Most Recent 2018 Transactions

It is astonishing to witness the phenomenal sales rate of J-Gateway units, with prices soaring up to as much as $19XX per square foot! Even more impressive, some buyers have reported incredible returns of up to $200K in profits!

J Gateway PSF Trendline

If we compare the launch of J Gateway with that of Caspian’s, we can see the clear appreciation in J Gateway’s prices over the last five years. Caspian, being the resale option, became a popular choice for people looking to buy a property in the west. Let’s take a closer look at Caspian’s PSF trendline.

Caspian PSF Trendline

If you had purchased Caspian back in 2013, when it was available for $11XX PSF, compared to J-Gateway’s launch price of $14XX to $16XX PSF, you could have already been collecting a generous rental income of $1500 a month, and making a profit of $54K after three years! This is much lesser than the potential 6-figure profits that could have been gained from J-Gateway, which is still under construction.

Despite selling at its highest peak prices in 2013, J-Gateway property investments would still have yielded higher profits than any other form of investment in the end. There is a vast difference in the gains and appreciation between the two.

Conclusion

Gaining a better understanding of Singapore’s property market can be a tricky endeavor, and none of us have a perfect grasp of it. Nonetheless, as we gain more knowledge and insights, it is important to be able to be flexible and open-minded, having the humility to accept when we’re wrong.

You might be thinking that I’m being biased in favor of the newer properties, but what I have said is not without reason. Everyday I’m witness to the improved performance of newer properties versus their older counterparts – the evidence is all around.

No matter my bias, the evidence that slowly erodes all the “rules” we’ve made is undeniable. While these rules are not entirely wrong and should be used as a general guideline, if you’re hoping to make a property investment and exit at its peak, these so-called rules may not be quite so applicable.

Despite the introduction of the TDSR cooling measures on 29 June 2013 – the day prior to the launch of J-Gateway – Singaporeans have defied the unwritten rule of “never enter the property market at the peak price” and pushed J-Gateway to record highs in 2018, showing just how much their buying habits have changed over the years.

Are you feeling uncertain about the preference of newer properties in the market? It’s become apparent that there is much less interest in older properties, meaning they become a second choice rather than a sought-after option. This goes to show how the property market is ever-changing and rarely follows the rules or expectations.

Worried that your own biases are impacting your view of the property market?

Allow me to assist you – schedule a thorough financial assessment session with me to gain more clarity on the property market.

You May Also Like …

Mandarin Top 5

5 Dangerous Ideas Singapore Property Investors Have

Jayson Ang – September 2, 2024 –

Singapore's property market has always been a hot topic among investors, both local and international. With its strong economy, stable...

Mandarin Top 5

Top 5 : Best Themed Cafes in Singapore

Jayson Ang – November 15, 2024 –

Singapore, a vibrant and diverse city, is known for its eclectic mix of cultures, cuisines, and attractions. Among the many...

Mandarin Top 5

Top 5 : Best Karting Circuits in Singapore

Jayson Ang – December 21, 2024 –

Singapore, a bustling city-state known for its modern architecture, cleanliness, and vibrant culture, is also home to a thriving karting...

Mandarin Top 5

5 Tips : How To Invest In Singapore Property Without Losing Sleep Over It

Jayson Ang – June 18, 2024 –

Investing in Singapore's property market can be a lucrative venture, but it's important to approach it with caution and a...

Mandarin Top 5

5 Tips : How To Spot A Good Investment Opportunity In Singapore’s Property Market

Jayson Ang – July 18, 2024 –

Singapore's property market offers a plethora of investment opportunities for both local and foreign investors. To spot a good investment...

All Buying Tips Opinion

Evaluating Property Investments: Pros and Cons to Keep in Mind

Jayson Ang – August 7, 2023 –

TLDR: Key Takeaways from the Blog Post Singapore's real estate market offers both pros and cons for investors. The advantages...

All Buying Tips

4 Fresh Trends among Young Homebuyers Could Shake Things up in Singapore’s Real Estate Scene

Jayson Ang – March 18, 2024 –

TLDR Younger generation in Singapore is reshaping house hunting by showing a preference for quality of life over location. Millennials...

All Blog Posts

Singapore Private Residential Market Outlook 2023

Jayson Ang – January 8, 2023 –

TLDR The Singapore residential property market has shown resilience in 2022, with price growth in both private housing and HDB...

Mandarin Top 5

Powering The Lion City: The Top 5 Industries Driving Singapore’s Economy

Jayson Ang – July 20, 2023 –

Powering The Lion City: The Top 5 Industries Driving Singapore's Economy Singapore is widely recognized as one of the most...

All Buying Tips Opinion Selling Tips

Timing the Market: Lessons from Singapore’s Property Price Fluctuations

Jayson Ang – December 18, 2025 –

TLDR Singapore’s property market has seen price declines during major crises such as the 1985-1989 pre-recession, 1996-1998 Asian Financial Crisis,...

Mandarin Top 5

Top 5 Factors To Consider When Choosing Between A Resale Condo And A New Launch In Singapore

Jayson Ang – June 17, 2025 –

TLDR Choosing between a resale condo and a new launch in Singapore depends on your priorities as an investor or...

All

URA 2025 Draft Master Plan: 6 Under The Radar Changes You May Have Missed

Jayson Ang – April 12, 2026 –

TLDR The URA 2025 Draft Master Plan outlines major developments in Singapore over the next 10-15 years, with 80,000 new...

All Blog Posts Opinion

When Should You Consider a Shorter/Longer Home Tenure?

Jayson Ang – May 8, 2023 –

TLDR Understanding the benefits of long-term home loans is crucial for financially conservative individuals in Singapore. Opting for a longer...

Mandarin Top 5

Top 5 : Is Investing In Properties Worth In Singapore?

Jayson Ang – February 3, 2025 –

Investing in properties has long been considered a reliable and profitable venture, and Singapore, with its robust real estate market,...

All Blog Posts Opinion

Breaking Through the Stalemate of En Bloc Sales

Jayson Ang – March 5, 2023 –

TLDR The Singapore property market faces challenges with the ongoing en bloc stalemate. Lower success rates, higher development risks, and...

Mandarin Top 5

Top 5 Reasons : How Can A Reputable Real Estate Agent Help You When Investing In Singapore Property

Jayson Ang – April 5, 2025 –

Investing in Singapore property can be a lucrative venture, given the country's stable economy, strategic location, and high demand for...

All Buying Tips Opinion

The New Condo Rule: How GFA Harmonization Makes New Launches “Pricier” and What It Means for Buyers

Jayson Ang – May 30, 2026 –

TLDR GFA Harmonization standardizes Gross Floor Area measurements across Singapore government agencies, removing non-usable spaces like oversized planter boxes, air-con...

Mandarin Top 5

Introducing Top 5 Power Property Tips

Jayson Ang – May 14, 2023 –

Hello, everyone! We are excited to welcome you to our blog posts! On this blog, we will be sharing daily...

All Buying Tips Opinion

A Potential Game-Changer: Singapore’s Proposed Minimum Transaction Rule for Property Agents in 2025

Jayson Ang – July 20, 2026 –

TLDR In Singapore’s real estate market, experience alone no longer guarantees an agent’s competence. Many agents maintain licenses without significant...