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STRATA LANDED OR LANDED HOUSE? WHICH ONE IS BETTER?

strata landed or landed house

Which is better? PURE LANDED or STRATA - Landed /Cluster House?

You might already know that in land scarce Singapore is not surprising that pure landed houses only takes up 1.5 per cent of the total housing stock in Singapore.

Only Singapore citizens are allowed to own landed properties in Singapore and pure landed houses are seen as extremely valuable.

Most Pure landed properties in Singapore sit on freehold land. In fact, only about 10 per cent of landed properties are leasehold.

Pure Landed properties are now seen as highly prize fixed asset as only households with high income can afford to purchase a pure landed property in current market.

A brand new Freehold 2-storey terrace house in areas like District 14– Jalan Senang can cost anywhere up to $3,000,000.

In fact, Pure landed property price has make much growth and outpaced other private properties prices for the last 10 years.

PURE LANDED HOUSE

STRATA TITLE / CLUSTER HOUSE

Areas highlighted in red are zoned as landed houses, under the URA Landed Housing Areas Plan

There are several keys difference between Pure Landed Properties and STRATA Landed Properties. We shall take a look at their difference in within these 4 keys characteristics:

  • 1) Land Title
  • 2) Maintenance Fees and Upkeep
  • 3) Price Quantum
  • 4) Resellability

(1) Land Title
PURE LANDED
– You own the land that your property sits on.
• For example, you buy a landed property that is 20/30 years old.

> Have the ability to seek approval to tear down the home & rebuild it.

> Redesign the home.
– how high the property will be? (2.5 story terrace/ 2 story semi-d).
-Flexibly to redevelop the property.

(1) Land Title
STRATA / CLUSTER HOUSE

  • You own the air space (similar to a condo)
    >Multiple landed properties On a Plot of land
    >whereby the owners of the individual unit.
    >do not own the land but share the whole
    >plot of land with each other.
    Different STRATA landed units in the same project land.
      Example: Landed properties in a condominium development.
    >Cannot tear down the place.

 

(2) Maintenance Fees & Upkeep

PURE LANDED

You do not have to pay monthly maintenance fees.
Maintenance fees in STRATA Landed are getting rather costly.

In many cases, condominium owners can be paying $400 or more a month for their monthly maintenance fees.

Pure landed house owners need not pay for monthly maintenance fees.

Nevertheless, they need to pay the monthly electrical and water bills as well as the waste collection fees.

They can decide how they would like to design and construct their property so long as it is within the various guidelines and you are free to sell your property on that land parcel in its entirety.

Landed property owner can also decide how they want to renovate their own property
So long as they adhere to the guidelines set aside by the URA, they are free to renovate their property in any way they deem fit.

They can alter the color to the front of their property and also build a pool, lift, change the color of the windows or install retractable awnings just to name a few. . Repainting and patching of any external cracks can be an essential cost in time to come.

In most pure landed property areas, there is the availability of curb side parking. This is to make good towards the parking space within the compound.

During festive seasons like Chinese New Year, it will become a common sight that the roads to be occupied with cars parked along the sides.

Unlike a strata landed, there is no security for landed properties.

Even though Singapore is always considered a safe nation, there are still petty thieve and occasional break-ins. Landed property owners are solely responsible for ensuring that their property is secure.

CCTV cameras and advance locks are common security improvising of landed properties.

(2) Maintenance Fees & Upkeep
STRATA / CLUSTER HOUSE

 – MCST (Facilities Management Agency)

– The Management (MCST) will use this money to upkeep the development.

– takes care of building facade, development’s infrastructure, utilities and general maintenance.
– Can also be used for upgrading of the premises, such as changing of the lifts or painting of the external façade.

  • Similar to staying in a condo
    >shared facilities (similar to condos) and enjoy greenery such as those available in private condominiums.
    -Good for growing families.
    >would hike kids to enjoy facilities.
    >need more than 4 bedrooms.

>requires less maintenance from the owner
• have to pay maintenance fees & sinking fund.

>Get a basement or open air carpark.

: Security is taken care of
> there is usually, at lease Security access gates
> in some cases, there will be perimeter CCTV cameras installed.
> if the property ground is big enough, security guards can be engaged.

(3) Price Quantum
PURE LANDED
Sometimes the budget required would be higher.

• need to spend more time (taking care of the home)

Although having facilities like a pool within one’s landed home is a prestige, it can be costly to develop and maintain.

It may become a luxury as most occupants do not use it frequently but only occasionally for leisure, rendering it an aesthetic than a functional item.
> landscaping. (garden, lawn)
> infrastructure (repainting the facade)
> managing cleaning services( for pool, Jacuzzi)

> do you have the time to manage your home?
   or would you rather a 3rd party manages it?

(3) Price Quantum
STRATA / CLUSTER HOUSE

The hefty price tag of land titled properties deters most buyers due to affordability.

In Q4 2017, the average price of a freehold strata terrace house was S$817 per square foot, as compared to S$1,417 per square foot for a freehold land titled terrace house.

Cluster houses have shown the potential to achieve higher yield during an upmarket as they can command almost equivalent rentals to land houses at a lower cost.

(4) Resellability
PURE LANDED

  • Very subjective
    • Depending on the area you’re looking at
    • Depending on what you’re looking for

(Do you want to rebuild/redesign the place?)

(4) Resellability
STRATA / CLUSTER HOUSE

  • Strata landed properties value has been proven able to hold up better than condominiums in the long run due to their limited supply.
  • It still remains attractive to buyers with stronger financial backgrounds, especially condo upgraders and en-bloc buyers. Strata/Cluster House would also attract to HDB upgraders who may consider this class of property a faster upgrade than condominiums, but at a more affordable price than land titled houses. 
  • In fact Pure Landed and STRATA landed properties can only be sold to Singapore citizens only. Hence the pool of buyers for a landed property is much smaller than a condominium.

This is something which I have constantly shared with my clients who have asked
me about strata landed…
There is no one better option when it comes to comparing between a typical pure landed property and a strata title landed.  

All things being equal would expect a typical
landed house to be pricier than a strata landed. The main reason is that you own the land in which the property lies on and in a land scarce country like Singapore that means that there will gradually be a smaller population of Singaporeans that own landed properties as more condominiums are built.

I would advise clients that if they likely cannot handle the demanding nature of maintaining their own landed house then they should get a typical non pure landed property like Strata landed property and if they prefer engaging somebody to manage their property for them then they should get a Strata landed.

Exclusivity in Landed property ownership in Singapore

Strictly only Singaporeans are allowed to purchase a landed property.

All foreigner or SPR may apply to the Land Dealings Approval Unit at the Singapore Land Authority (SLA) for an approval to purchase a landed property but he has to fulfil certain criteria to be considered. The rules are strict and getting an approval is very rare.

The only exceptional place in Singapore where foreigners can purchase a landed property is in Sentosa Cove. An application to the Land Dealings Approval Unit is still mandatory but the process will be step up.

In summary, landed properties generally provide home owners with more space as compared to a condominium or HDB.
They also tend to be located exclusive locations and thus you would require a car to travel conveniently to and fro if your landed property is further away from the main road. Never expect landed properties houses to be located close to MRT stations.

Felix specializes in real estate exclusive listings, digital sales marketing and leases.

A trusted consultant to many successful property owners, perhaps the most compelling testament to his success is himself – through strategically analyzing the market and well-calculated investments, he already owns local and overseas properties

Today, as a property consultant of one of the largest real estate company in Singapore, Orangetee and Tie Pte Ltd with a reputable track record, I wish to share my strategies for financial freedom with you.

I hope to help you put in place a secure retirement plan and enjoy the lifestyle you have always desired.

To start with, I can help you identify a good value investment in today’s market. Also, I would like to advise you on the best ways of financing your property.

For instance, is paying your bank loan a good or bad debt? Also, I can help my client unlock the maximum loan from the bank even though they have a car loan.

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I graduated a Diploma in Mass Communications with a passion for video editing and graphic design and website designing.

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This Post Has 2 Comments

  1. Susanna

    Thanks for shedding light on this topic!

    1. admin

      Thank you for reading my article!

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