One of the most common questions buyers ask is: Should I buy a freehold or leasehold property? While both have their merits, your decision in 2025 depends on your goalswhether you're buying for lifestyle, legacy, or returns. In this guide, we break down the key differences, benefits, drawbacks, and how to make the smartest choice for your situation.
1. Whats the Basic Difference?
? Freehold Property
Ownership is permanent
You own the property and the land it sits on forever
Ideal for legacy planning or long-term hold
? Leasehold Property
Ownership is for a fixed term, commonly 99 or 999 years
After lease expiry, ownership reverts to the state
Most government-sold HDBs and many condos are leasehold
✅ In Singapore, the majority of private condos are 99-year leasehold.
2. Pros of Freehold Property
Legacy value: Can be passed down without concern of lease decay
Resale value stays stronger, especially after 3040 years
More control over en bloc decisions (for condos)
Usually seen as premium and scarce (less supply)
3. Cons of Freehold Property
Higher price: Often 1020% more expensive than leasehold units
Not always better located
Lower rental yield compared to similarly priced leasehold units
Longer breakeven period if buying for investment
4. Pros of Leasehold Property
Lower entry cost: Great for first-time buyers and investors
Located in mature or central estates (e.g., Queenstown, Punggol, Tampines)
Higher rental yield in the early years
Popular for short- to mid-term flipping
? Example: ECs like Tampines Street 95 EC are leasehold but offer excellent value and modern layouts. Learn more
5. Cons of Leasehold Property
Value drops significantly as lease approaches 30 years or less
Harder to secure full financing for old leasehold units
Limited pool of buyers for aging properties
En bloc potential becomes essential for long-term exit
6. Property Value vs Lease Decay
Heres how value typically declines for leasehold:
| Lease Remaining | Bank Loan Eligible | CPF Usable | Resale Value Impact |
|---|---|---|---|
| 60 years | ✅ Yes | ✅ Yes | Strong resale |
| 3060 years | ⚠️ Limited | ⚠️ Partial | Buyers cautious |
| 30 years | ❌ No | ❌ No | Value declines steeply |
If you're buying leasehold, aim for at least 80 years remaining for good resale and financing options.
7. Which Is Better for Investment?
It depends on your strategy:
Short-term rental income Leasehold (lower cost, higher yield)
Long-term capital growth Freehold (especially in growth corridors)
En bloc potential Leasehold in older condos with high land value
? Tip: Dont just look at tenureconsider location, amenities, and future development plans.
8. Financing Differences
Banks are more conservative with old leasehold units
CPF usage is restricted if the lease ends before the buyer turns 95
Freehold properties are easier to finance and refinance, especially after 30 years
Always check with your bank or mortgage broker if you're eyeing an older leasehold unit.
9. Legacy Estate Planning
For buyers thinking generational wealth:
Freehold is the clear winner
Leasehold may not hold value long enough for your children to benefit
Freehold can be sold anytime without concerns over lease decay
That said, leasehold can still serve as a stepping stone to your future freehold upgrade.
10. Final Recommendation:
Ask yourself:
How long do I plan to stay in the property?
Am I buying for lifestyle, rental income, or future resale?
Can I afford the freehold premium without sacrificing location or space?
If you're buying your forever home, go freehold if the budget allows. If you're aiming for ROI and rental gains, a well-located leasehold can perform just as wellif not betterin the short to mid-term.
Conclusion:
Both freehold and leasehold properties have a place in Singapores market in 2025. Freehold offers permanence and prestige, while leasehold opens doors with affordability and rental potential. The smart buyer doesnt just pick based on tenurethey match the property to their personal goals, timeline, and financial plan.
Important Link
Tampines Street 95 EC Site Plan
Tampines Street 95 EC Location
Tampines Street 95 EC Site Plan
Tampines Street 95 EC Floor Plans
Tampines Street 95 EC Developer
Tampines Street 95 EC Project Details
