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Discussion – 


Discussion – 


New Launch vs Resale Properties: What to consider in 2021?

new launch vs resale singapore

New Launch vs Resale properties in 2021

2021 has been a stand-out year for property sellers, with new launches selling out fast, and resale prices skyrocketing. But let’s spare a moment to think about the buyer’s side in the environment: home buyers are struggling right now, with prices rising in the resale market, and new launches facing delays. A common question right now is which to go for: new launch, or resale. Let’s take a look:

Current new launch versus resale prices in 2021

New launch prices averaged $1,760 psf in May 2021, across all districts. This is up around 37 per cent, over a five-year period.

Resale properties averaged $1,338 psf in May 2021, down about 4.6 per cent from five years ago (although you can see prices have begun a strong upward trend, even across the Circuit Breaker period).

Note that 2021 could see a sharp hike in resale prices toward the end of the year, barring events like cooling measures. This is because many developers are currently land-starved, and this could cause in surge in collective sales.

Why choose a new launch property in 2021?

  • More low quantum, central region options if you don’t mind smaller units
  • Chance for early-bird discounts
  • Progressive Payment Scheme helps with initial cash flow
  • No lease decay to worry about
  • Can mean more unit choices
  • More up-to-date facade and facilities
  • Might be cheaper to renovate

1. More low quantum, central region options if you don’t mind smaller units

2020 and 2021 saw many units in pricey areas, that traded size for location. For example, Uptown@Farrer, The M, and Midtown Bay are all centrally located. While you’d usually expect to pay $2 million and up at least for these locations, these projects had units priced at $1.3 million or lower.

The trade-off, of course, was size; many of these low-quantum units had a much higher price per square foot (sometimes in excess of $3,000 psf).

Nonetheless, these provide an alternative to live in otherwise unaffordable areas, for those who are singles or young couples. They also provide an investment opportunity, for landlords who want to rent out central or city fringe condos, but can’t handle a large quantum due to the Additional Buyers Stamp Duty (ABSD).

2. Chance for early-bird discounts

New launches usually – but not always – start with loss leaders. The first few units sold, such as the VVIP preview, are often just to start the ball rolling. The buyers in the first phase could manage to shave off 10 to 15 per cent of the price.

(Drop me a note if you want to be in on these preview events, and I may be able to get you in).

The theory is that, if you buy for 10 to 15 per cent cheaper in the first phase, you would make quick returns the moment the developer sets prices to normal.

But that said, please note it’s never guaranteed that the developer won’t give further discounts later. This has happened from time to time, such as if they want to beat the ABSD.

Most developers are reluctant to drop prices later though, as they know it could wound the trust of early buyers.

3. Progressive Payment Scheme helps with initial cash flow

The Progressive Payment Scheme (PPS) means you will pay more for your home loan as different stages of the condo are completed:

Construction phase Percentage of price disbursed
Foundations laid 10%
Reinforced concrete completed 10%
Walls in place 5%
Roofing complete 5%
Doors, plumbing, and electrical wiring done 5%
Car park, roads, and drains complete 5%
Temporary Occupancy Permit (TOP) received 25%
Certificate of Statutory Completion (CSC) received 15%

This means it’s possible that in your first few months, you are only paying a few hundred dollars in loan repayment. This amount will gradually rise as your condo is completed. If you’re servicing the home loan with CPF you may not “feel” the effects; but it’s quite significant if you’re paying the loan in cash.

4. No lease decay to worry about

You don’t need to worry about the project’s age as much, since it’s new. Even if it’s a 99-year leasehold condo, it will be a long time before the age starts to matter.

If your goal is asset progression, note that newer condos are often easier to sell. This is because home loans can be capped at 55 per cent for older condos, and loans are not possible for properties with remaining leases below 30 years.

5. Can mean more unit choices

With resale condos, you are limited to what’s up for sale. But if you’re early to a new launch, you can usually get the first pick of the best units. This can mean getting a better view, a more efficient layout, or a unit closer to the main facilities.

This is not always true though; if you’re late to a new launch, you may be stuck with only what’s left. As such, I’d suggest you move quick, if your intent is to buy a new condo.

6. More up-to-date facade and facilities

The facilities and look of a new condo are all shiny and up-to-date; and there’s undeniable psychological appeal in owning NEW things.

It’s up to the management committee to keep things looking good, over the next few decades.

7. Might be cheaper to renovate

This is as true with HDB flats as it is with condos. New units are typically in a “ready to move in” state, even with minimal renovations. With resale units however, disrepair – or simple discomfort at being in “someone else’s” home – usually means a rush to renovate.

It should be noted that, in 2021, labour and supply shortages are causing significant delays in renovation.

With all that being said, we might ask…

Why choose a resale property in 2021?

  • It’s not just renovation, there are construction delays too
  • Proven transaction history
  • You have something to rent out right away
  • Certain elements are invisible until the unit exists
  • Older condos tend to be bigger

1. It’s not just renovation, there are construction delays too


New home construction is facing delays, just as with renovation. So while renovations may take a while, it’s still better than finding out your condo won’t be completed for another six months. Construction delays are especially devastating if you’re a landlord, as it means loss of rental income.

As such, home owners who need a place to stay right now in 2021 might do better to pick resale. You know for a fact that you can move in, almost as soon as the transaction is complete. This is especially helpful to HDB upgraders, who don’t want to end up renting and having to move twice.

2. Proven transaction history

With resale condos, you can see the transaction history – you know what people are buying and selling units for, as well as how much rental income they generate.

(If you can’t find out or don’t know how, drop me a note and I can help you find the data).

With new launch condos, this is mostly speculative. For the first few years, in fact,  the price and rental income of new launches can be quite volatile, as the market settles on the right price point.

3. You have something to rent out immediately

In my experience, some landlords will only be interested in resale properties. This is common if their strategy is to focus on cashflow positive properties (i.e., the property must more than pay for the loan or other recurring costs). With new launch properties this is usually not possible, as there’s nothing to rent for a few years while the condo is being built.

If you want to seek rental income, note that resale properties can be purchased while tenanted (i.e, buy over a property that already has a reliable, existing tenant).

4. Certain elements are invisible until the unit exists

There are certain things about a unit that you can never see in a showflat. Examples are noisy neighbours, poor condo management, and a recent development across the road that springs up to block the view.

For these reasons, many home owners prefer existing units, where all the proverbial cards are on the table. This is especially true for families, who need a conducive environment for children (it’s a nightmare to look after a baby when the neighbour is blasting music till two in the morning).

Poor condo management is especially frustrating, like when Pine Grove condo had two committees fighting for control. This could affect facilities and upkeep, and no amount studying showflats / brochures would help you foresee this.

5. Older condos tend to be bigger

If you don’t believe me, just check out condos like The Bayshore, where the smallest units are over 930 sq. ft. This is close to the size of a 4-room flat today (about 983 sq. ft.), but it’s only a “small” two-bedder at The Bayshore.

You’ll find the same in condos like Bullion Park, Mandarin Gardens, or almost any condo built in the 1990’s. So while you do have to accept more advanced lease decay, and dated facilities, the greater living space may more than compensate.

There is no inherently “correct” choice, as it depends on your needs

Old and new launch condos

For home buyers who need a lot of space, there may be no replacing a huge 1990’s era condo. For buyers aiming to rent to single expats, a new launch, one-bedder near the CBD may tick all the right boxes.

That said, I would suggest buyers put aside the more speculative elements – such as early bird discounts or en-bloc potential for old condos – and look at the fundamentals. The property should be within budget (no more than five times annual income), and have the right amenities for its tenant demographic or home owner.

If you can find the right fit, don’t worry too much about whether it’s new or resale.

For more on picking the right property, you can follow me on RonChongProperty.sg.



Ron Chong


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