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Making the Choice Between New Launch or Resale Condo (Updated 2024)

new launch vs resale condo
We’ll be talking about one of the most heated arguments among Singaporean real estate investors today: New Launch vs Resale Condos?
 
This may be a subject you have been talking about with friends, real estate agents, and even other property investors if you are trying to get into the real estate market.
 
I will address three crucial points in this discussion (you are welcome to jump ahead to the part that most directly affects you).
Know your own objectives:
 
  1. Understand your personal goals
  2. Pros of New Launches vs. Pros of Resale Condos
  3. Case Studies Comparing Actual Performance of New Launches vs. Resale Condos
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Table of Contents

Understand your personal goals

To make the best property investment, it’s crucial to consider your personal goals first.

Everyone has different needs and circumstances, so what works for your friend may not necessarily work for you.

It’s essential to take everyone’s opinion with a grain of salt and balance it against your own needs.

Don’t rush into buying a New Launch condo just because someone else had a great experience with it.

To help you make an informed decision, ask yourself these questions:

  • What are your goals for buying this property?
  • Do you need to move in immediately, or is it a long-term investment?
  • Are you looking for a forever home, or do you plan to sell the property for gains in the future?
  • Are capital gains essential to you.

By taking the time to think about these factors, you can make an informed decision that aligns with your goals and suits your unique situation.

Roqy koh

Pros of New Launches vs. Pros of Resale Condos

Let’s talk about the benefits of buying a Resale Condo compared to a New Launch Condo.

Pros of Resale Condos

Let’s talk about the benefits of buying a Resale Condo.

1) Immediate Move In and Rental

One major advantage of a Resale Condo is that you can move in and start renting it out immediately.

Since the property is already on the market, you can expect to collect rent within a few months.

In some cases, the unit may even come with an existing tenant, so you can start earning rental income right after purchasing the property.

2) Clear Rental Expectation

Another benefit is that you have a clear idea of the rental income you can expect to receive since there is a history of rental income for the property.

This can be reassuring for new investors who may not have experience forecasting potential rental income.

3) Cheaper Psf (per square foot)

Resale Condos also tend to have a lower cost per square foot compared to New Launch Condos in the same neighborhood.

This can be an attractive option for those who are looking for a deal.

Additionally, older property developments tend to offer more space compared to new launches, which is a definite pro if space is a priority for you.

4) What You See Is What You Get

When you buy a Resale Condo, what you see is what you get.

There is no need to visualize the property or look at show flats since the property is already completed.

This can be a great option for those who prefer a hands-on approach to property buying.

5) Under Value Purchase

Finally, there is potential to purchase a Resale Condo below its true value.

There are many possible reasons why owners choose to sell, and in some cases, the seller may have to let go of the property below its true value.

If you do your research, you may get a great deal for your investment.

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Pros of New Launches

Let’s take a look at the benefits of buying a New Launch Condo.

1) Developer Incentives and Promotions

new launch phrase

New Launch Condos usually come with great promotions and discounts from the developers.

This is because they want to generate interest in the project and attract early buyers.

By buying early, you can take advantage of these promotions and lock in a lower price.

This means that you can benefit from a higher profit margin if you decide to sell the property later on.

2) Lower Cost of Maintenance

When you buy a new property, you won’t have to spend as much on maintenance as you would with a resale condo.

Developers usually provide a one-year defect liability period, which is like a warranty for your property.

In contrast, a resale condo might require renovation, which can cost anywhere from $60,000 to $100,000.

Any additional costs can eat into your potential gains, especially if you’re buying the property as an investment.

3) Newer Facilities and Technologies

New Launch Condos often come with the latest facilities and technologies, which can make them more attractive to potential tenants.

These facilities can include rooftop infinity pools, smart home technology, sky gardens, and concierge services.

Investing in a property with these amenities can help you attract high-end tenants and set higher rents.

4) Lower Price Quantum

New Launch Condos are usually smaller in size than resale condos, which means that they have a lower overall price.

If you’re looking for a property with a lower investment outlay for the same number of rooms, a New Launch Condo could be a good option.

5) Smaller Initial Mortgage Loans

Since payment for properties is made progressively, the mortgage loans for New Launch Condos will be smaller compared to resale condos.

This can make it easier for you to manage your finances and make the payments.

new launch agent

Case Studies Comparing Actual Performance of New Launches vs. Resale Condos

Having discussed the qualitative advantages of New Launches versus Resale Condos, let’s now turn our attention to a quantitative analysis of the performance of two pairs of properties located in two distinct neighborhoods over the course of several years.

If you are interested in capital gains, take a closer look!

District 19

We present a comparison between Jewel @ Buangkok, a new launch from 2013, and The Quartz, a TOP (Temporary Occupation Permit) development from 2009.

Based on the figures, can we determine which type of property performed better 11 years after 2013? Jewel @ Buangkok saw a rise in psf (per square foot) by +35.2%, whereas The Quartz recorded an increase of +16.82%.

District 03

new launch vs resale condo

In the second case study, we compare Commonwealth Tower, a new launch from 2014, to Alexis, a Freehold development that TOP in 2014.

Based on the data, can we determine which property type performed better 10 years after 2014? Commonwealth Tower saw a psf (per square foot) increase of 30.76%, whereas Alexis experienced a rise of +5.03%.

Summary

After exploring two different districts and comparing New Launches with Resale Condos, our analysis clearly shows that New Launches generally offer greater potential for capital gains. Whether in well-established areas or up-and-coming neighborhoods, New Launches stand out as the more profitable choice for investors looking to maximize their returns.

One important aspect to consider, however, is that while Resale Condos can sometimes be a more immediate option, they often come with the additional expense of renovations.

This is something potential buyers should keep in mind when making their decision.

Conclusion

In summary, both New Launches and Resale Condos have their own unique advantages for property buyers and investors.

When deciding between a New Launch and Resale Condo, it ultimately depends on your personal preferences and investment goals.

It’s essential to take into account various factors such as location, amenities, property age, price, and potential rental income before making a decision.

By doing your research and consulting with a professional, you can make an informed choice that meets your needs and maximizes your returns.

Bonus for our readers

is new launch a better buy

Ready to take the leap and find your dream condo in Singapore?

We are here to guide you through the process with our PPP (Property Potential Price) matrix tools.

Don’t hesitate to reach out to us for expert advice and personalized recommendations.

Let’s work together to turn your property dreams into a reality!

Who should apply

  • First-time homebuyers looking for a starter home or investment property
  • Experienced homebuyers interested in purchasing a luxury property or expanding their property portfolio
  • Foreign investors looking to purchase property in Singapore
  • Retirees looking to downsize or invest in property for passive income
  • Families in need of more space or interested in upgrading their living arrangements

Questions & Answers

Q1) What are some factors to consider when choosing between a new launch and resale condo?

Answer: When deciding between a new launch and resale condo, it’s important to consider factors such as location, amenities, property age, price, and potential rental income. By doing thorough research and seeking professional advice, you can make an informed choice that suits your needs and maximizes your returns.

Q2) Can I purchase a condo in Singapore as a foreigner?

Answer: Yes, foreign investors are allowed to purchase property in Singapore, subject to certain restrictions and requirements. It’s important to consult with a realtor or lawyer who can guide you through the process and ensure compliance with local regulations.

Q3) What are some common mistakes to avoid when purchasing a condo?

Answer: Common mistakes to avoid when purchasing a condo include not doing enough research, overlooking hidden costs such as maintenance fees and taxes, underestimating the importance of location, and not working with a trusted realtor or lawyer. By being aware of these potential pitfalls and seeking expert guidance, you can avoid costly mistakes and make a successful investment.

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