Prices of leasehold units seems to have been more positive than those which are freehold homes. According to a media reports by consultancy Cushman & Wakefield, freehold units hit suffered a higher drop of more than 4% since Q3 2013 compared to the 1% drop for leasehold units.
Therefore, the difference between prices of freehold non-landed homes across its leasehold counterparts has reduced, said Ms Christine Li, director of research at Cushman & Wakefield.
Comparing freehold property Newton 18 to its neighbour 99-year lease Amaryllis Ville, the price difference in the early days is actually about 35 %. But in recent quarters, the difference has reduce to 15%, it means that over time, leasehold units might outshine freehold homes, Ms Christine Li shared.
However, property experts informed that the statistics may have been twisted by the low transaction volumes.
Property analysts noted the price performance between freehold and leasehold properties also count on the en bloc potential to be sold by means of collective sale. Normally, when the en bloc market is hot, freehold projects get a higher price premium.
Somehow, a Knight Frank study of cautions showed another trend by which the price difference between leasehold homes and freehold projects has increased further to 44 % in year 2014 from about 33% in the early year.
The average prices of freehold projects last year, climbed to 9.8 % to $1,532 on yearly basis, while for leasehold homes it drops 0.4 percent to S$1,045 psf.
“In the next coming years, as the Government continuously releases land sites which are all leasehold tenure, freehold properties’ availability is slated to remain decline or stagnant”, Knight Franks research head, Alice Tan stated.
One of the upcoming 99 years leasehold project is Kingsford Waterbay, located at Upper Serangoon View, District 19.