Are Old Freehold Condos Still Profitable In Singapore?

In theory, freehold condos should continue to appreciate well over the years. One common argument you’ll hear, for example, is that because developers won’t need to top up the lease, freehold projects have better en-bloc value and potential. But there’s growing skepticism these days, as some ponder whether maintaining a condo for 40+ years is truly viable - and with new projects appearing nearby, could a very old condo still appreciate well, even if it’s freehold? We took a look:

Average freehold condo prices based on age:

Year/Age	Less Than 10 Years Old	Less Than 20 Years Old	Less Than 30 Years Old	Less Than 40 Years Old	40 Years Or More	Grand Total
2014	$1,609	$1,249	$1,212	$1,194	$1,003	$1,510
2015	$1,588	$1,222	$1,124	$1,148	$1,029	$1,441
2016	$1,663	$1,210	$1,100	$1,140	$1,051	$1,475
2017	$1,705	$1,235	$1,167	$1,180	$1,172	$1,505
2018	$1,821	$1,345	$1,238	$1,320	$1,264	$1,620
2019	$2,118	$1,444	$1,308	$1,342	$1,279	$1,804
2020	$1,963	$1,423	$1,290	$1,359	$1,169	$1,695
2021	$2,057	$1,621	$1,384	$1,445	$1,364	$1,816
2022	$2,280	$1,741	$1,507	$1,625	$1,622	$1,999
2023	$2,459	$1,846	$1,617	$1,671	$1,567	$2,117
2024	$2,427	$1,873	$1,702	$1,627	$1,592	$2,000
Grand Total	$1,944	$1,492	$1,346	$1,375	$1,381	$1,730

This shows the average price per square foot of a freehold condo, upon each decade it ages. For those who are interested in how it measures up versus leasehold, you can compare it to this article. 

Based on the linked article, leasehold condos that are 10 years old or under average $1,410 psf, which is about 31.8 per cent lower than a freehold equivalent. 

At 40+ years old, the average leasehold condo is around $997 psf, which is about 32.9 per cent lower than a freehold counterpart. This is a very slim difference, and suggests that leasehold may not fall as drastically as expected versus freehold; not even after 40+ years.

Another interesting point here is that, if you’re willing to settle for a condo that’s 30+ years old, you may be looking at a quantum of $1.6 million to $1.7 million for a 1,000 sq. ft. (roughly three-bedder) unit. 

So a freehold, family-sized condo unit may still be within reach for upgraders in 2024, if they can bear with an ageing property located further away. 

Let’s look at how much freehold condos appreciate on average, based on age:

Year/Age	Less Than 10 Years Old	Less Than 20 Years Old	Less Than 30 Years Old	Less Than 40 Years Old	40 Years Or More
2014
2015	-1.33%	-2.12%	-7.27%	-3.85%	2.65%
2016	4.75%	-1.02%	-2.20%	-0.69%	2.17%
2017	2.50%	2.13%	6.14%	3.53%	11.47%
2018	6.84%	8.91%	6.11%	11.83%	7.83%
2019	16.32%	7.33%	5.65%	1.63%	1.19%
2020	-7.35%	-1.47%	-1.37%	1.29%	-8.61%
2021	4.81%	13.96%	7.26%	6.31%	16.69%
2022	10.84%	7.38%	8.89%	12.52%	18.89%
2023	7.84%	6.05%	7.27%	2.82%	-3.39%
2024	-1.31%	1.46%	5.28%	-2.66%	1.64%
Grand Total	4.39%	4.26%	3.58%	3.27%	5.05%
Total Volume	33277	14368	7136	2195	569

The condos seem to fare better in the first two decades (perhaps because the condo isn’t considered “very old” yet), or toward the 40+ year mark, when we may be seeing a long holding period show its rewards.

Average percentage gains or losses during transactions 

Row Labels	Less Than 10 Years Old	Less Than 20 Years Old	Less Than 30 Years Old	Less Than 40 Years Old	More Than 40 Years Old	Grand Total
2014	7.8%	20.7%	26.4%	13.0%	31.3%	11.0%
2015	11.9%	24.6%	29.1%	31.7%	46.0%	16.4%
2016	14.6%	31.0%	31.3%	35.3%	21.5%	20.3%
2017	15.6%	29.1%	31.8%	34.4%	24.4%	21.0%
2018	11.7%	21.1%	23.8%	34.7%	28.9%	16.0%
2019	13.7%	26.4%	33.3%	33.1%	24.7%	19.5%
2020	18.4%	30.6%	34.5%	32.8%	34.2%	24.6%
2021	13.7%	24.0%	24.4%	7.5%	32.1%	18.9%
2022	8.1%	33.3%	12.4%	6.3%		15.0%
2023	1.5%	4.1%				2.5%
Grand Total	12.5%	25.9%	29.0%	31.8%	26.9%	17.5%

The highest percentage gains seem to come from selling between the 30 to 40-year mark, but not after. Similar to leasehold counterparts, profits may weaken past the 40-year mark due to financing issues. Banks tend to lower the maximum loan quantum at that point, which necessitates a higher cash outlay; and this may in turn exert downward pressure on prices. 

Looking at performance by District

Profitability

Year/District	D1	D2	D3	D4	D5	D7	D8	D9	D10	D11	D12	D13	D14	D15	D16	D17	D18	D19	D20	D21	D23	D26	D27	D28	Grand Total
2014	7%	8%	6%		12%		7%	5%	12%	11%	9%	14%	7%	17%	17%	5%	4%	10%	8%	18%	21%	1%	9%	14%	11%
2015			6%	31%	21%		9%	13%	20%	14%	12%	18%	13%	18%	27%	17%	9%	11%	11%	26%	21%	26%	16%	23%	16%
2016			31%	9%	21%	7%	16%	16%	22%	20%	18%	13%	12%	23%	25%	20%		15%	14%	33%	29%	33%	27%	24%	20%
2017	31%	8%	33%	11%	22%		15%	17%	21%	18%	20%	16%	14%	24%	30%	27%		17%	20%	30%	31%	33%	47%	35%	21%
2018		5%	13%		14%		13%	12%	15%	15%	14%	16%	14%	17%	19%	23%	31%	17%	17%	25%	21%	11%	38%	34%	16%
2019		9%	21%	6%	18%		22%	9%	19%	21%	13%	32%	17%	22%	28%	21%		27%	17%	26%	26%	39%		32%	20%
2020		13%	22%		25%		24%	9%	27%	19%	25%	25%	23%	28%	24%	35%		26%	15%	22%	33%	41%	44%		25%
2021		10%	33%	-15%	9%			8%	18%	12%	12%	16%	14%	27%		27%		43%		15%					19%
2022					3%		16%		37%	4%			7%	15%						11%					15%
2023								0%	2%	-2%				10%											3%
Grand Total	23%	8%	21%	9%	17%	7%	12%	12%	19%	16%	15%	18%	13%	21%	24%	20%	8%	15%	14%	26%	26%	26%	29%	24%	18%

Volume

Year/District	D1	D2	D3	D4	D5	D7	D8	D9	D10	D11	D12	D13	D14	D15	D16	D17	D18	D19	D20	D21	D23	D26	D27	D28	Grand Total
2014	1	10	7		58		43	98	109	66	72	5	109	163	18	29	5	74	12	52	28	5	4	6	974
2015			4	1	33		27	76	116	60	62	24	71	163	18	26	3	64	22	46	22	8	2	6	854
2016			10	11	23	1	28	76	121	62	45	10	67	151	13	16		49	23	44	28	8	7	10	803
2017	2	18	9	4	42		30	100	162	72	85	25	97	199	23	35		63	10	68	36	11	4	4	1099
2018		6	7		38		20	75	95	55	96	10	87	141	15	21	1	55	7	39	25	5	3	2	803
2019		19	4	2	15		3	28	34	26	27	6	40	89	8	18		23	6	11	12	3		1	375
2020		2	1		9		4	15	20	11	18	4	21	34	2	10		12	2	27	14	3	1		210
2021		1	1	1	3			5	11	2	5	1	6	21		4		1		3					65
2022					1		2		2	2			1	3						1					12
2023								1	2	1				1											5
Grand Total	3	56	43	19	222	1	157	474	672	357	410	85	499	965	97	159	9	341	82	291	165	43	21	29	5200

Unfortunately, this isn’t too useful, because freehold properties tend to cluster heavily in some areas but are very rare in others. 

In Districts 9 and 10 for example (the Orchard to Bukit Timah areas), it’s more common to find older freehold rather than leasehold properties; conversely, District 25 (Woodlands) doesn’t even appear, as almost everything there is leasehold. 

For some of these districts, the transaction volume is so low that the “average” gains don’t mean much, and prices can be volatile. So the gains in Districts like 9 or 10 may provide a more accurate depiction of the area (we’d be careful with District 15, as the area includes many boutique freehold condos that can be quite volatile).

When is the freehold premium worth paying?

In general, the freehold premium (about 15 to 20 per cent higher than a leasehold) only starts to pay for itself much later on. If you’re going to sell within a short period like 10 years, for example, the freehold status doesn’t really mean much; but if you’re selling only in 30+ years, then it may prove its worth without the lease decay.

Due to the long holding period, a concern for homeowners is how well the condo is maintained. This could be an issue in very big developments with lots of facilities - you have to question if the multiple swimming pools, landscaped areas, BBQ pits, etc. will still look good after you hold for so long. Freehold status protects your property from lease decay, but not from declining condo management.