Why pick a new property over a resale for investment?

By EdgeProp Singapore / EdgeProp | August 1, 2018 6:30 PM SGT
  • Some developers are now offering add-ons and discounts to offset higher ABSD rates and stricter loan limits from the new cooling measures.
  • Buyers of under construction properties can potentially save more on home loan interest rates.
  • However, older resale properties tend to be larger and more affordable.
Malaysian-listed developer, SP Setia offered buyers a 5% discount at the launch of Daintree Residence on July 28
Singaporeans have a love affair with property, as the stability and growth potential associated with real estate investments prove too great an opportunity to pass up.
When done properly, investing in property can indeed offer a number of benefits for individuals, including the ability to diversify income streams and to capture long-term capital appreciation.
Here, a dilemma that typically arises is whether to purchase a new property from a developer or one from the resale market.
New Sale vs Resale Properties: What’s The Difference?
Source: URA
If you are looking to purchase a home, here are a few reasons why investing in a new property from a developer instead of a unit in the resale market might offer more value for your money.
1) Developer add-ons and incentives
In response to the latest property cooling measures, some developers are now offering add-ons and discounts of up to 5% to offset the higher Additional Buyer’s Stamp Duty (ABSD) rates or stricter Loan-to-Value (LTV) rates to incentivise first-time homebuyers.
This is because with the marked increase of ABSD on investors and foreign buyers, the demand base for new properties will likely shift towards first-time homebuyers. As such, some developers are recalibrating their offerings to match the needs of these buyers.
For a start, Malaysian-listed developer, SP Setia offered buyers a 5% discount at the launch of Daintree Residence on July 28. The 327-unit project on Toh Tuck Road was the first project to be launched following the new cooling measures that...