Increased Seller’s Stamp Duty (SSD) Rates in Singapore: Implications for Buyers and Sellers
TLDR From July 4, 2025, Singapore reinstates Seller’s Stamp Duty (SSD) rates to 2017 levels, with rates of 16%, 12%,...
Read More
TLDR
Over the past decade, 2+Study units (compact 3-bedroom layouts) consistently outperformed standard 2-bedroom units in resale gains across most projects, both for long-term and short-term holdings. Examples include Stirling Residences and Parc Esta, where 2+Study units recorded significantly higher profit margins. Rental yields, however, tend to be slightly higher for regular 2-bedroom units due to their lower price points, though the difference is marginal. The 2+Study option offers a qualitative advantage in rentability, appealing to a wider tenant base such as small families, roommates, and remote workers needing extra space. Buyers should carefully assess the functionality of the “study” space and kitchen design before purchasing. Overall, for those seeking capital appreciation, 2+Study units present better returns, while rental yield advantages remain modest. Demand for these units is expected to grow as affordability for larger units declines.
With current high property prices making 3-bedroom and larger units less accessible, 2-bedroom units, particularly the more spacious 2+Study (often marketed as “compact 3-bedders”), have garnered significant attention. A key question for buyers and investors is whether the additional “study” space translates into better returns or simply eats into rental yield. This analysis examines the gains and rental performance of these two unit types over the past decade.
Resale Gains: 2-Bedroom vs. 2+Study (2014-2024)
An analysis of 11 projects that feature both 2-bedroom and 2+Study configurations, based on new-to-resale transactions from 2014 to 2024, reveals a clear trend:
- Overall Trend: In 8 out of 11 projects, 2+Study units demonstrated higher average gains compared to regular 2-bedroom units.
- Significant Differences:
- At Stirling Residences, 2+Study units saw average gains of $476,290 (36%), significantly outperforming 2-bedroom units which gained $268,719 (22%), a difference of over $207,000.
- Parc Esta exhibited similar results, with 2+Study units gaining $476,266 (35%) versus $323,711 (27%) for standard 2-bedroom layouts.
- Exceptions: Amber Park and Mont Botanik Residence were among the few projects where standard 2-bedroom units slightly outperformed 2+Study.
Interestingly, Martin Modern’s unprofitable transactions included six 2-bedroom units and only one 2+Study unit, suggesting potentially better downside protection for the latter, though this is based on limited data.
New-to-Subsale Performance (Before TOP):
Analyzing new-to-subsale transactions (properties sold by an initial buyer to another party before the condo is fully built), a similar pattern emerges:
- Consistent Outperformance: In 12 out of 16 projects, 2+Study units recorded higher average gains than regular 2-bedroom units.
- Notable Gaps:
- Martin Modern saw 2+Study units gaining $239,094 (12%) compared to $135,969 (7%) for 2-bedroom units.
- At Parc Esta, 2+Study units gained $357,750 (26%) versus $264,129 (23%) for 2-bedroom units.
- Outliers: Kent Ridge Hill Residences and Sky Everton were exceptions where 2-bedroom units yielded better gains.
This data suggests that even for shorter holding periods, the 2+Study layout tends to deliver superior resale outcomes. A notable anecdote from Sky Everton, despite its limited sample size, showed a 2+Study unit incurring a significantly smaller loss ($26,000) compared to a 2-bedroom unit ($132,000), although holding period differences might have influenced this.
Rental Rates and Yields: Landlord’s Perspective
Analyzing rental data to precisely compare 2-bedroom and 2+Study units is challenging due to URA’s broad size ranges. However, by matching unit sizes from sale transactions to corresponding URA rental size bands for 2024, an estimated rental yield comparison can be made:
The data indicates that 2+Study units generally do not offer a significant rental yield advantage. In most cases, standard 2-bedroom units slightly edge out 2+Study units in yield due to their lower price points. For example, Whistler Grand’s 2-bedroom units yielded 3.97% compared to 3.64% for 2+Study units, primarily due to the latter’s higher average purchase price. While the differences are often marginal, the slightly lower yield for 2+Study units is consistent across most projects.
Rentability: A Qualitative Advantage of 2+Study:
Despite similar or slightly lower yields, the qualitative advantage of a 2+Study unit lies in its enhanced rentability. Its versatility allows it to cater to a broader tenant demographic, including:
- Small families
- Roommates
- Single tenants requiring a dedicated home office or additional storage, particularly relevant in a post-pandemic era with increased hybrid work arrangements.
This broader appeal can make it easier for landlords to find and retain tenants, potentially reducing vacancy periods. For landlords willing to stretch their budget, the increased versatility of a 2+Study unit might justify the investment.
Conclusion:
The analysis largely favors 2+Study units in terms of resale gains, both for long-term holding and shorter subsale periods. As the affordability of larger units becomes more challenging, the demand for 2+Study units, bridging the gap between compact 2-bedders and larger 3-bedders, is likely to persist or grow.
However, not all 2+Study units are created equal. Prospective buyers should carefully evaluate:
- Post-Harmonization Status: Whether the project is pre- or post-harmonization, as older designs might include wasted space (e.g., large planter boxes, oversized air-con ledges).
- Functionality of “+1” Space: Ensure the “study” is a genuinely functional, enclosable room with proper ventilation and natural light, not just an awkward corner.
- Kitchen Design: For families, the kitchen space is crucial. Look for functional layouts like nook kitchens with ample cabinetry and countertops.
Should You Buy, Sell or Wait?
If you’re reading this, you must be trying to figure out the best course of action right now: is it the right time to buy or sell?
It’s difficult to give an exact answer since everyone’s situation is unique and what works for one person may not necessarily work for you.
I can bring you a wealth of on-the-ground experience and a data-driven approach to provide clarity and direction. From beginners to experienced investors, our top-down, objective approach will help you on your real estate journey.
I can help you by:
- Offering Strategic Real Estate Advice – I can help create a comprehensive plan to guide you through your property journey.
- Connecting Your Home with the Perfect Buyers – Through stunning visuals, an effective communication strategy, and an in-depth knowledge of the market, we’ll ensure your home is presented in the best possible way to fulfill your goals.
You May Also Like …
Does Sell 1 Buy 2 Strategy Still Works Today in 2024?
TLDR When considering the "Sell One By Two" property investment strategy, keep in mind that it involves selling your previous...
Read More
Executive Condos in Singapore: Have They Outgrown the “Sandwich Class” Label?
TLDR The Executive Condominium (EC) scheme, once intended as affordable “sandwich class” housing, is now acting more like a lottery...
Read More
Top 5 : Best Themed Cafes in Singapore
Singapore, a vibrant and diverse city, is known for its eclectic mix of cultures, cuisines, and attractions. Among the many...
Read More
5 Things to do When You Go For A Property Viewing In Singapore Part 2
5 Things to do When You Go For A Property Viewing In Singapore Part 2 Here are 5 more things...
Read More
Why Chinese Investors Should Not Be Deterred by ABSD: 5 Reasons
Why Chinese Investors Should Not Be Deterred by ABSD: 5 Reasons Here are the top 5 reasons why Chinese investors...
Read More
Top 5 Places to Watch the Sunset in Singapore
Singapore, a bustling city-state known for its modern architecture and vibrant culture, is also home to some of the most...
Read More
How Can Real Estate Investment Help You to Combat Inflation?
TLDR When it comes to real estate investments in Singapore amidst rising inflation rates, consider strategies such as capitalizing on...
Read More
Top 5 Street Food Markets in Singapore
Singapore, a melting pot of diverse cultures, offers an incredible array of street food that tantalizes the taste buds of...
Read More
5 Insider Tips From Real Estate Experts On How To Get The Best Deal On Property In Singapore
Investing in property can be a great way to build wealth and secure your financial future. However, with Singapore's highly...
Read More
Should I Buy In A Newly MOP HDB Or An Older Resale HDB?
TLDR When deciding between a recently MOP-ed HDB property and an older resale HDB property in Singapore, various factors come...
Read More
What Happens To Your Housing Loan Once You Sell Your House?
TLDR When selling your home in Singapore, ensure you pay off your outstanding home loan, refund any CPF monies used,...
Read More
Top 5 Best Green Spaces to Picnic in Singapore
Singapore, a bustling city-state known for its modern architecture and vibrant culture, is also home to numerous green spaces that...
Read More
Should Foreign Buyers Be Deterred By the 30% ABSD?
TLDR Foreign buyers interested in private residential properties in Singapore is a common sight due to the country's positive reputation...
Read More
Top 5 : Most Profitable Neighborhoods To Invest In For Singapore Property Investment 2025
As the global economy continues to recover, the real estate market in Singapore remains a promising investment opportunity for savvy...
Read More
Singapore’s En Bloc Landscape in 2025: Four Potential Residential Sites to Monitor
TLDR Developer confidence in Singapore’s property market is rising in 2025 despite global uncertainties, supported by strong sales in new...
Read More
Purchasing Older HDB Resale Flats: Key Considerations When the Flat Outlives You
TLDR HDB flats have a 99-year lease, and key housing schemes require the lease to cover the youngest owner until...
Read More
Lessons from the Rollercoaster Ride: Homebuyers Share Their Singapore Housing Market Experiences
TLDR The Singapore housing market is a rollercoaster of unpredictable changes. Three homebuyers share their experiences: Tristan waited too long...
Read More
Homeownership, Desire To Upgrade Still Strong Among Youths
TLDR Young Singaporeans are redefining the "Singapore Dream" with homeownership and property upgrading at its core. Most Gen Zs (85%)...
Read More
The Integrated Living Experience: Benefits and Drawbacks of Condos Above an MRT
TLDR Integrated developments in Singapore combine residential units with commercial spaces and direct MRT access, offering convenience and car-free living....
Read More
