Property seekers who are looking to buy a private condominium in Singapore have the option of purchasing either a new condo launch directly from a developer or a resale condo in the open market.
This year, we could see up to 60 new launches across the island offering thousands of condo units. In addition, hundreds of resale condos are being put up for sale every month. While this leaves home buyers spoilt for choice, it also makes the buying decision harder.
To help you make the right choice, we’ve listed down various pros and cons of buying a new condo launch versus a resale condo.
- Room for negotiation
Developers will set a fixed price for a new condo launch and there’s usually little room for negotiation. Prices will vary depending on the project’s location, land price, construction cost and prevailing market conditions. In a bid to attract buyers, developers may offer sweeteners such as early bird discounts and furniture vouchers.
Resale condos, on the other hand, are sold by individual sellers who list their properties at higher asking prices as they expect buyers to negotiate for a lower price. Buyers will have more room to negotiate in certain circumstances, like if the homeowner needs to dispose the property quickly or when market conditions become less favourable for property sellers.
- Seeing is believing
Buying a newly launched condo unit involves visiting a showflat to view the different unit types and layouts on offer. According to URA rules, showflats must accurately depict the actual property, but developers like to include designer furniture, fancy lighting and bright wallpaper to make the units look more luxe. While it does offer useful ideas on how to decorate a living space, it may be tougher for buyers to envision what the actual unit will look like once completed.
At the same time, some showflats are not built on the actual site of the project due to land constraints. As such, buyers have to rely on brochures and maps to know what amenities are in the vicinity, such as bus stops, MRT stations, shopping malls, supermarkets and schools.
Viewing a resale condo enables prospective buyers to walk through the actual unit for sale, see if it’s spacious enough for the entire family and look at the surrounding views. The last thing you want is for your unit to face a busy road or even worse, a refuse collection point!
At Auctionjia, our agents have heard of new launch buyers exclaiming that the common corridor looks narrower than initially expected, and even more so with a shoe-rack or potted plants.
- Avoid living next to a bad neighbour
If you’re lucky, you may have friendly neighbours who are helpful and willing to lend a hand. Unfortunately, buying a newly launched condo means you won’t know who is living next door till you move in.
On the other hand, when viewing a resale condo, you have the chance to talk with your potential neighbours and get a sense of whether they are easy to get along with. The last thing you want is a “neighbour from hell”, like the recent case of six families living on the same floor in a Punggol HDB block who were forced to move out due to an abusive neighbour.
- Older but larger homes
Many buyers often bemoan the fact that new condos in Singapore are usually smaller than older condos built 20 to 30 years ago. Over in Bishan, for instance, a two-bedroom apartment at Bishan 8 which was completed in 2000 measures about 980 sq ft, while a similar unit type at the recently launched JadeScape is smaller at around 764 sq ft.
This trend of smaller homes is set to continue with young couples here having fewer kids and property prices on a general uptrend. Despite this, there is still strong demand for more spacious units in the resale condo market.
- Swankier facilities in new condo
Buyers of new condo launches can boast of having access to a wealth of facilities. Aside from standard offerings like swimming pools, barbecue pits, a gymnasium and a clubhouse, new projects also come with resort-like facilities such as rooftop infinity pools, sky gardens, walking trails, golf courses and even concierge services. You’ll find that a typical condo brochure in 2019 lists down up to 100 different facilities catering to every age group from a toddler to a retiree.
Some of the modern resale condos may have unique facilities, but it’s unlikely that these projects can match what the new launches are offering.
- Ability to rent immediately
A resale condo allows buyers to rent out the property immediately, unlike a new condo launch which may take two to three years to TOP. Some resale condo also come with existing tenants which ensure zero downtime for investors.
While some tenants prefer to stay in newer projects given the amenities, another factor to consider is that for certain new launch condo, there may be a flood of investors who are putting up their units at the same time, leading to greater competition in the rental market.
What about premium pricing?
Now that you’ve looked at some of the pros and cons of buying a new condo launch versus a resale condo, what property are you intending to buy? If affordability is your top consideration, then new launches generally carry a premium pricing compared to resale condos. Is this premium pricing worth it? Will this premium pricing ‘disappear’ over time as the new launch condo starts to age too? Buyers will need to consider this carefully, and if you need help to evaluate a potential purchase, do reach out on our live chat, and our agents would be happy to assist.