Rental Yields Over Hype: Are Low-Quantum Properties the Smarter Bet in 2025

Why That Cheaper Rental Unit Might Outperform the Next Shiny New Launch

It’s 2025, and Singapore’s private property market is still going strong—but let’s be honest: it’s expensive. New launches are pushing $2,200 PSF and above, even in suburban areas. A basic 2-bedder? Easily $1.6M or more.

While developers promote capital appreciation and transformation zones, savvy investors are asking:

“Is it really worth stretching my finances, or is a lower-cost, high-yield rental property the smarter play today?”

Here’s why cheaper resale investment units are turning out to be the better-performing asset class in 2025.

1. Lower Entry Price = More Options, Faster ROI

Let’s compare entry prices. A new launch unit will likely cost you $1.4M to $1.7M for a 2-bedder, even in OCR projects.

But a $680K to $850K resale unit near an MRT, in areas like Geylang, Aljunied, or Potong Pasir, can get you strong rental demand and positive cash flow from day one.

📌 Real-life scenario:

- New Launch 2-Bedder in Lentor: $1.6M

- Resale 1-Bedder in Geylang: $680K

- Resale 2-Bedder in Potong Pasir: $1M

You could own two income-generating assets instead of one capital-heavy unit—each producing better rental returns.

2. Rental Yields That Actually Make Sense

Let’s look at gross yield with real numbers:

📌 Resale Example 1 – 1-Bedder in Geylang

- Purchase: $680K

- Rent: $3,200/month

- Annual Rent: $38,400

- Yield: 5.64%

📌 Resale Example 2 – 2-Bedder in Potong Pasir

- Purchase: $1M

- Rent: $4,200/month

- Annual Rent: $50,400

- Yield: 5.04%

📌 New Launch – 2-Bedder in Lentor

- Purchase: $1.6M

- Rent: $3,800/month

- Annual Rent: $45,600

- Yield: 2.85%

Even if you round down for conservatism, resale yields beat new launches hands down.

3. At 3% Interest, Resale Mortgage Is More Manageable

Let’s compare monthly loan repayments assuming a 30-year tenure, 75% loan, and 3% interest rate.

📌 New Launch Condo – $1.6M

- Loan: $1.2M

- Monthly Mortgage: ~$5,059

📌 Resale Unit – $680K

- Loan: $510K

- Monthly Mortgage: ~$2,151

📌 Resale Unit – $1M

- Loan: $750K

- Monthly Mortgage: ~$3,168

Conclusion? Which is maybe better?

With a resale property, you’re paying far less per month—making it easier to hit positive cash flow, even if interest rates fluctuate.

💡 Bonus: Your breakeven rent is much lower too, so you’re less likely to dip into your own pocket during tenant turnover or market dips.

4. Capital Appreciation Isn’t What It Used to Be

In the past, early-bird new launch buyers enjoyed capital gains before TOP. Today, with land prices and construction costs at record highs, developers are launching projects close to resale levels.

📌 Example:

- You buy a new launch unit at $2,300 PSF

- Nearby resale condos are transacting at $1,700–$1,800 PSF

The gap is too wide. It could take 5–7 years for prices to catch up—and that’s assuming the resale market climbs. During this wait, your cash flow might be negative, especially with a larger mortgage.

5. Renters Don’t Care if It’s Brand New

Let’s be brutally honest: tenants rent based on location, price, and access—not whether your unit is brand new.

A 1-bedder that’s 3 minutes from Aljunied MRT, has food downstairs, and goes for $3,200/month, will be snapped up way before a glossier unit that’s a 15-minute walk to the MRT.

What renters really want:

- ✅ Close to MRT

- ✅ Affordable rent

- ✅ Food and amenities nearby

Which is exactly why resale units in mature city-fringe areas still command strong rental demand, even without the bells and whistles.

So Which Strategy Wins in 2025?

Go Resale If You Want:

✔ High rental yields (4.5–5.6%)

✔ Lower monthly repayments

✔ Diversified risk across multiple units

✔ Tenant-ready properties with strong demand

Go New Launch If You Want:

✔ Modern facilities and a fresh unit

✔ Progressive payment flexibility

✔ Long-term capital appreciation (5–10 year horizon)

✔ Own-stay lifestyle with growth potential

Final Thoughts

Singapore’s property game is evolving. With higher prices, larger loans, and stricter stress tests, it’s no longer just about how fancy your unit is—it’s about how hard your dollar is working.

If you're looking to build wealth through steady cash flow and manageable risk, a resale rental property might just be the quiet performer your portfolio needs.

Want to find high-yield, low-quantum units with solid rental demand? Contact us today!

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