What are the Options for a Leasehold Property Owners when their 99 years Tenure is about to End?

PropertyGuru Editorial Team
What are the Options for a Leasehold Property Owners when their 99 years Tenure is about to End?
In Singapore, there are two types of property ownership, namely leasehold and freehold. The latter means you own the property and the land it sits on in perpetuity, meaning there is no time limit over your ownership of the freehold land and property.
With a freehold land or property, you don’t have to worry about getting evicted from your home or finding another flat, unless the government mandatory buys your residential property to make way for a project that benefits the public, like for the construction of roads, bridges, and railway lines.
On the other hand, leasehold means your ownership is only valid for a fixed period of time. For private properties in Singapore, the leasehold tenure is usually 99 years or 999 years.
999 years is a long time, and with such term, a property can be passed on to multiple generations. However, such tenures were previously granted in the past and the government is no longer providing 999-year leasehold ownership. As a result, the most common at present is the 99-year leasehold tenure.
As humans can live pass the age of 100, those living in 99-year leasehold homes face the problem of lease expiry, particularly for those who inherited their residential property from their parents or grandparents.
But what happens when the lease of a private property runs out? What are the options of those living in ageing homes with dwindling leases to overcome such problem?
These are among the crucial questions we will answer in this article, so do read on.

What happens after the 99-year lease expires?

Majority of the land here is owned by the government, with the Singapore Land Authority (SLA) acting as the caretaker of these precious assets in the land-scarce city-state.
Some portions of state land are held the Housing and Development Board (HDB) and industrial landlord JTC. In comparison, freehold land owned by private individuals only amount to a small percentage.
According to the SLA, as a general policy, leasehold land will be taken back by the government when the lease expires, and the residents living there will no longer have any right over the property, including the right to live there.
Given that a property has to be returned to the state when the lease runs out, the residents have to move out, otherwise they will be charged with trespassing on state land. Worse, the former home owners will get no remuneration. Let me repeat that: you get ZERO COMPENSATION.

Options of residents living in 99-year lease property

No one wants to be evicted from their home without getting anything in return, so what are the options available to those living in developments with declining leases?
Fundamentally, property owners have two choices, but both require forking a large payment to the state to prolong the leasehold tenure of the land.
Private home owners can either pay a hefty top-up premium to the SLA, or sell their property collectively to a property developer, which will in turn pay the top-up premium.
Please note that the two options are only available to owners of leasehold private residential properties. Such methods cannot be taken up by residents of leasehold HDB flats.
For details on the two options, please read further.

1. Pay Premium to Renew Lease

One of the two options for owners of private housing with dwindling leases is to apply with the Singapore Land Authority (SLA) to renew the lease of the land occupied by their development.
However, owners need to pay a premium, usually totalling millions, which will be borne by all of them. The amount to be paid will be determined by the agency’s Chief Valuer based on various factors like the land’s market value and its remaining leasehold tenure.
For instance, a 99-year private condominium has only 40 years remaining on its lease, and the owners can pay a hefty premium to refresh the lease back to its original term.
Aside from the large amount that needs to be paid by each unit owner, another disadvantage of this move is that the SLA may or may not allow the owners to renew the lease of their development.
This is because the agency needs to take into account several things before it can approve a lease top-up. One main consideration is the lease extension’s impact on the government’s planned use for a particular site or land.
Nonetheless, if the owners of the property are allowed to refresh the lease, residents can continue to stay in their homes until the renewed lease expires. By then you may no longer be around.
While lease renewal is a good option for unit owners at 99-year leasehold condos – especially for those who want to age in place and for those whose homes hold sentimental value – not all residents can afford to pay the expensive premium to renew the lease.
Notable examples of developments in Singapore that successfully refreshed their leases with the SLA include Lumiere (previously known as HMC Building), 50 Collyer Quay (formerly Overseas Union House) and the SGX Building (previously known as ICB Building).

2. Get a Huge Windfall via En Bloc Sale

Unlike a typical property sale, whereby an individual owner sells the unit to a buyer, in an en bloc sale, all owners will transact their entire private development to one purchaser.
However, depending on the age of the property, at least 80 percent or 90 percent of the unit owners by strata area and share value must give their consent to the en bloc sale. If all owners unanimously approve, there is no need to obtain an order of sale from the Strata Titles Boards or High Court.
Also known as collective sale, this is a popular option for those with ageing private properties or homes with dwindling leases thanks to the good chance of getting good remuneration depending on the state of Singapore’s private residential market.
In an en bloc, the buyers are mostly property developers which intend to redevelop the site. As these are often large companies with lots of capital, these entities can afford to pay the premium to renew the lease to 99 years, on top of a development charge to intensify the use of the land (i.e. build more houses).
Although the former owners will likely get a good price for their residential units, they need to vacate the premises after the completion of the deal. It’s a sale after all. But given the large profit, they will be in a good position to buy a replacement home, either a newer 99-year leasehold private condo or a freehold one. That’s a lot better than letting the lease reach zero, then getting evicted from your home without any compensation.
The most recent time when Singapore’s collective sales market heated up was in 2017 until the first half of 2018 before the latest property cooling measures took effect on 6 July 2018. Thereafter, en bloc sales crashed by 90.71 percent quarter-on-quarter to S$353 million in Q3 of the same year compared to S$3.8 billion during the preceding quarter due to the new curbs.

Top 5 En Bloc Sales in 2017

Tampines Court
S$1.71 million to S$1.75 million
S$970 million
Amber Park
S$4.3 million to S$8.3 million
S$906 million
Normanton Park
S$1.68 million to S$1.86 million
S$830.1 million
S$2.25 million to S$2.41 million
S$766 million
Florence Regency
S$1.84 million to S$1.89 million
S$629 million
Source: News reports

Top 5 En Bloc Sales in 2018 (so far)

Pacific Mansion
S$3.26 million to S$3.48 million
S$980 million
Tulip Garden
S$4.3 million to S$7.6 million
S$906.9 million
Park West
S$1.4 million to S$2.3 million
S$841 million
Pearl Bank
S$1.8 million to S$4.9 million
S$728 million
Goodluck Garden*
S$924,000 to S$3.51 million
S$610 million
Source: News reports *Under legal proceedings
Prior to 2017, the en bloc sector peaked in 2012. In fact, the record holder for the largest en bloc transaction was the S$1.339 billion sale of Farrer Court that provided the owners of the 618 units there with net proceeds of S$2.122 million to S$2.238 million.
But Singapore’s en bloc market slowed down in 2013 after stringent rules were imposed, like the Total Debt Servicing Ratio (TDSR) framework.
If you want to gain a better understanding of en bloc sale process, please look up our guide.


Due to the drawback of lease expiry, we don’t recommend buying a 99-year leasehold condo if your intention is to provide a home for your children and future descendants.
But if the reason for your purchase is to house your family during your lifetime and you think your children would be able to buy a home on their own, then it’s okay to acquire 99-year leasehold homes.
Another reason to consider such residential properties is when you’re purchasing solely for investment purposes, whether to resell later or to rent out.
Although the leasehold tenure of residential properties impacts its upside potential, in terms of resale price and monthly rent, there many other key factors that affect such values.
For instance, keep in mind that when investing in properties, the most paramount consideration is location, location and location!
This means condo units, whether 99-leasehold or freehold, situated in prime or sought-after areas will generally command higher prices and rents due to the robust demand from buyers and tenants.
Furthermore, well-located developments close to MRT station, supermarkets, reputable school and various amenities are highly desired by property developers. This increases the potential of getting a hefty windfall via a successful en bloc sale.
You may also browse our resale HDB flats or private condos for sale or rent. If you need someone to assist you for a property deal, kindly engage a licensed property agent.
To get more guides like this, check out PropertyGuru
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