Residential

Freehold property not necessarily better than 99-year leasehold

The two general types of property tenure in Singapore – 99-year leasehold property and freehold property – could be considered similar. However, freehold properties could hold a few advantages over leasehold properties, including higher en-bloc potential, slower pace of depreciation (as leasehold properties’ value would diminish over the course of their lease) and no restrictions on the use of Central Provident Fund for home purchases. Recent statistics have shown that new leasehold condominiums have dominated the market in recent years, with new leasehold and new freehold condo sales standing at 95 and 5 percent respectively for the first half of 2013. On the contrary, 70 percent of new sales were freehold in 2006 and 2007. This could be due to the increase of the government land sales programme in recent years and the tightening of en-bloc rules in Oct 2007.

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