FREEHOLD VS. 99-YEAR LEASEHOLD: SINGAPORE CONDO ROI EXPLAINED (2025 GUIDE

When searching for a condo for sale in Singapore, one of the most important decisions you’ll face is whether to buy a freehold condo or a 99-year leasehold property. This debate has shaped the Singapore property market for decades, and in 2025 it remains one of the most asked questions among buyers and investors.

On one hand, a freehold property in Singapore offers indefinite ownership and legacy appeal. On the other, a 99-year leasehold is often more affordable and provides stronger rental yields in the short to medium term. So, which is better for ROI? Let’s dive deeper.

What Makes a Freehold Condo Different?

A freehold condo is one where the ownership has no expiry. Families see it as a legacy asset that can be passed down through generations. Likewise, a freehold landed property in Singapore is often viewed as a status symbol, and scarcity keeps demand strong.

Meanwhile, most modern launches are sold on a 99-year leasehold basis. These are still similar to a private property in Singapore, but ownership reverts to the state at the end of the tenure unless a collective sale occurs earlier.

The difference in tenure creates very different financial outcomes, especially when evaluating property value in Singapore and ROI potential.

Why Is There a Freehold Premium?

The market often observes a freehold condo premium in Singapore, where freehold units are priced higher than leaseholds.

Key reasons for the premium include:

• Scarcity of freehold land: New GLS (Government Land Sales) sites are almost always leasehold.

• Perceived long-term value: Many buyers see freehold as a hedge against lease decay.

• Ease of financing: Banks are more comfortable lending against freehold property, regardless of age.

Freehold vs Leasehold Pricing Benchmarks (2025)

Region	Freehold Average PSF	Leasehold Average PSF	Premium %
CCR (Prime)	$2,850	$2,450	~16%
RCR (City Fringe)	$2,200	$1,900	~15%
OCR (Suburbs)	$1,750	$1,600	~9%

Table: Freehold vs Leasehold

The gap is steepest in the Core Central Region (CCR). A freehold condo near MRT in this zone can command a hefty premium. In the suburbs, however, the lower entry price of leasehold units often translates into higher ROI.

How Should ROI Be Calculated in the Singapore Property Market?

A common mistake buyers make is to judge ROI solely by price appreciation. In reality, Singapore condo returns should factor in rental yield, financing costs, and duties.

Both metrics are important, especially when comparing freehold vs leasehold condo in Singapore, since freehold properties often require higher upfront cash, while leasehold units may deliver stronger rental yields in prime tenant catchments like OCR and RCR

General ROI formula:

ROI = (Price growth + Rental yield) − (Interest + Fees + Duties + Vacancy + MCST)

• Freehold condos: Higher upfront costs but stronger long-term preservation.

• 99-year leasehold condo investment in 2025: Lower entry cost, often higher percentage returns.

Case Study: Freehold vs Leasehold ROI

Imagine two buyers in 2025:

Criteria	Buyer A (Freehold CCR Condo)	Buyer B (99-Year OCR Condo)
Purchase Price	$2,000,000	$1,500,000
Rental Yield	2.8%	3.5%
Holding Period	12 years	12 years
Price Growth	15%	25%
Net ROI (est.)	~2.9% annualised	~4.2% annualised

Table: Freehold vs Leasehold ROI

While Buyer A enjoys the stability of freehold ownership, Buyer B walks away with stronger ROI due to affordability and higher rental demand.

When Do Freehold Properties Outperform?

Freehold tends to shine in three main situations:

1. Prime scarcity: A legacy freehold condo near MRT in the CCR maintains value even in downturns.

2. Ultra-long holding horizon: Families planning for multi-generational ownership prefer freehold.

3. En-bloc opportunities: Developers are often willing to pay more for freehold plots as there’s no lease top-up.

   
   

When Does Leasehold Offer Better Returns?

A 99-year property can outperform freehold in ROI terms when:

• The launch is close to new MRT stations or commercial hubs.

• The price gap is too large, making leasehold a more efficient investment.

• Strong upgrader demand supports resale value in the OCR and RCR.

For example, tenants rarely care if a unit is freehold. What they do care about is accessibility, layout, and amenities.

What Happens When the Lease Runs Down?

One big question buyers often ask: What happens when a leasehold runs out?

• At expiry, land returns to the state.

• There is no lease buyback scheme for private condos.

• Bank financing tightens once leases fall below 60 years.

• En-bloc sales usually happen before year 99.

Bank Loan Eligibility by Remaining Lease

Remaining Lease	Loan Access	Impact
> 60 years	Normal financing	Wide buyer pool
30–59 years	Restricted	Demand narrows
< 30 years	No bank loans	Only cash buyers

Table: Bank loan eligibility

This makes tenure a crucial factor for very long-term investors.

How Do Buyer Preferences Shape ROI in 2025?

In today’s Singapore property market, younger buyers are practical. Instead of stretching budgets for freehold, they focus on:

• Connectivity (especially Singapore condo projects near MRT).

• Lifestyle amenities like pools, gyms, and integrated retail.

• Resale liquidity: ease of exit often outweighs tenure concerns.

As a result, a 99-year leasehold condo investment in 2025 in a well-connected district can easily outperform a freehold located in a less convenient area.

What About Future Trends?

Looking beyond 2025, several factors will shape freehold vs leasehold condo ROI in Singapore:

• Urban redevelopment: New MRT lines, commercial hubs, and regional centres will boost leasehold values in OCR and RCR.

• Government cooling measures: With ABSD and financing rules in place, speculative gains are capped. Tenure matters less than timing and location.

• Shifting demographics: Younger buyers may continue prioritising affordability over freehold legacy value.

Final Thoughts

The freehold vs leasehold condo in Singapore debate isn’t about right or wrong; it’s about matching tenure to purpose.

• Freehold = Stability and Legacy: A freehold property in Singapore is ideal for those valuing permanence, long horizons, and wealth preservation.

• Leasehold = ROI and Accessibility: A 99-year leasehold condo investment in 2025 is often the smarter move for ROI-driven buyers, thanks to lower entry costs, higher rental yields, and stronger exit liquidity.

Ultimately, tenure is only one factor in ROI. For most buyers, property value in Singapore is shaped more by location, transport, demand, and timing. Whether you’re buying a Singapore condo as a resident or as an investor, always weigh ROI, lifestyle, and future resale together, not tenure alone.