Owning a landed property in land-scarce Singapore is already a far-fetched dream for many. With only 73,295 pure landed (freehold and 999 year leasehold) homes as of end 2022, this number is unlikely to increase significantly anytime soon. Driving through some of Singapore’s landed property and you are bound to realise the unique blend of – very old and brand new homes in the same neighbourhood. Hence as a general practice, we tend to segment them into four different categories. While this can be confusing for potential buyers who are unfamiliar with the local market, this article will explain the different types of landed properties, their characteristics, and how they are classified. It will also provide insight into the advantages and disadvantages, helping buyers like yourself make informed decisions when purchasing a landed property in Singapore.
The 4 Segments of Landed Property
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Segment 1: Older, meant for rebuild / reconstruction |
Segment 2: Slightly Older, Suitable for Major renovations / A&A |
Segment 3: Almost new, minor renovations required |
Segment 4: Brand new from Developers |
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Age |
More than 35 years old |
Between 20 – 30 years old |
Less than 15 years old |
Brand New |
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Costs |
Approx $300 – $350 PSF (on final built up area) for Detached – Intermediate Terraces respectively |
Prices vary depending on scope of works. Set aside $800K – $1.2M |
Prices may vary from $250K – $500K, depending on scope of works |
Minimal to no works needed |
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Time |
18 – 24 months (including submissions*) |
6 – 15 months (including submissions for A&A) |
5 – 9 months depending on scope of renovation works |
Move in right away. Usually still under the D.L.P (Defect Liability Period – 1 year) |
Segment 1: Older Landed Homes Suitable For Rebuild / Reconstruction
Singapore is known for its high-quality housing and landed properties, which are divided into segments based on age, location, and condition. One such segment is Segment 1, which consists of older landed (in some cases, dilapidated) single storey homes that are only suitable for rebuilding or reconstruction. By doing so, you will be able to maximise the potential of these properties, subject to the different zonings and envelope control. The best part is, you are able to have full control of your design and layout and also “upgrade” your status if the site and your neighbour’s site permits. Furthermore, these old homes may come at a slightly lower entry price as compared to it’s newer peers. These are some of the potential advantages of properties in this segment.
Segment 2: Slightly Older, Suitable For Major Renovations / Addition & Alterations Works
Segment 2 is the most popular segment among home buyers, as it consists of properties that are between 20 and 30 years old, making them suitable for alteration and addition (A&A) or major renovation works.
Landed properties in this segment offer a great opportunity to add value to the property through such renovations. Furthermore, since the properties are not too old, they (and their structures) tend to be in better condition than those in segment 1, hence making them an attractive option for those looking to buy landed properties in Singapore. These homes are also preferred as you will not have to wait as long for work to be completed before moving right in.
Segment 3: Almost New, Only Minor Renovations Required
Landed homes in this segment are also very much sought after as they are still predominantly young, well maintained, and have been built up to their maximum floor area. However, you may still wish to do some minor renovations such as redesigning certain parts to your taste, or re-doing electrical, plumbing, flooring and paint works internally. In Singapore’s tropical weather, it will also be beneficial to have the roofs and waterproofings checked and redone to avoid additional repair costs and inconvenience down the road. Costs and downtime may also vary depending on the extensiveness of the work done.
Segment 4: Brand New Landed Homes By Developers
Property developers are now turning to brand-new landed developments to meet the growing demand for residential properties. These developments offer a unique opportunity for those looking to invest in real estate, as they provide a combination of quality construction and modern amenities. This segment is also preferred as it saves buyers time and hassle albeit paying a premium for it.
In addition, developers are taking advantage of this trend by investing in these projects and creating luxurious living spaces that offer more than just a place to live. With their attention to detail and superior design, these brand-new landed redevelopments can be an ideal choice for those looking for something different from traditional housing options. Developers are also incorporating state-of-the-art features to future-proof their developments, such as smart home technology and green building materials and electric vehicle charging points, making them even more attractive investments.
Which Segment is Appropriate for Me?
Understanding the perspectives to consider when navigating through this landscape is key to making informed decisions. This includes taking into account factors such as demographic shifts, economic conditions, and government policies. Additionally, understanding the nuances of each segment within the landed market can provide valuable insights that could help property owners make better decisions and maximize their purchase decisions.
Consider choosing one of the brand-new sorts of landed houses if you’re seeking something that has increased in value by a percentage more than the previous two years (Segment 4). The benchmark price for newly constructed landed residences climbed by 43% on average between Q1 2020 and Q1 2022, the smallest percentage rise of the four sections, whereas the price of older land intended for a rebuild (Segment 1) rose by 75%. In contrast to having to wait 18 to 24 months (or more) if you buy an old plot of land to construct upon, you will still be moving into a completely new home that has been completely renovated for you and without hassle or delay.
Assume you are interested in restoring an older land (Segment 1) despite the fact that it had a significant 75% increase since you have a longer time frame and significant retaining power. Before seeking an equity credit line or a construction loan to reconstruct your new house, you might opt to first explore the real estate market and wait a year or so until values have increased even more. Given that this viewpoint has the lowest entrance cost and the shortest entry level into the pure landed marketplace at $3.5M, you might wish to consider it. This holds true for Segment 2 landed properties that need A&A works as well.
Think about the time and money you may be saving by not rebuilding
Your potential cost of time and if you have a long enough time frame to spend in constructing your own dream house will determine which perspective is appropriate for you. Otherwise, it would be more sensible to move into a brand-new one right away. Another aspect to take into account is the spike in building costs brought on by the worldwide pandemic’s impact on raw material prices, the labor shortage, and rising inflation rates. Your overall reconstruction expenses might ultimately rise to the point where you would be spending more to reconstruct your own house than you would purchase a newly built ready-made one as building prices increase.
Discover Luxury Homes Built By An Award-Winning Developer
Sevens Group is a leading real estate development company with a proven track record of more than 10 years in the industry with over 100 landed developments completed to date. Sevens Group is consistently committed and passionate to developing the superior quality standard, modern, and state-of-the-art real estate projects.
Looking for your dream home? Contact our Developer Sales Team today and they will be happy to be of service. In the meantime, keep your eyes peeled for our next article.
