A 99-year leasehold property gives you the right to use the land for 99 years, after which it returns to the state. The clock starts when the lease is issued — usually when the project is built — not when you buy, so a “99-year” flat or condo on the resale market always has fewer years left than that. Value holds up reasonably well for the first few decades, then falls at an accelerating rate once the remaining lease drops below about 60 years, as CPF usage and bank financing tighten. Leasehold is not a bad buy in itself, but the remaining lease has to match how long you plan to hold and how you intend to exit.
The lease counts down from day one, not from your purchase
Every HDB flat is sold on a 99-year lease. Most private condominiums in the suburbs are leasehold too, typically 99 years, occasionally 999 years. The important point is when the countdown begins.
The lease runs from its commencement date, which is set close to when the land is handed to HDB or the developer — years before the first owner collects the keys. By the time a flat or condo reaches the resale market, it may already be 20, 30 or 40 years into its term. A “99-year leasehold” resale flat with 68 years left is exactly that: a 68-year asset, priced and financed as one.
When the lease finally expires, the property and the land return to the state. For an HDB flat, the flat is surrendered to HDB with no compensation and the lease is not renewed. For private leasehold land, the site reverts to the state unless the lease has been topped up beforehand.
Lease decay and Bala’s Curve
The market does not treat a leasehold property as holding full value until the last year and then falling off a cliff. It declines gradually, then faster.
The reference point most valuers and the Singapore Land Authority use is a schedule commonly called Bala’s Table (or Bala’s Curve). It expresses the value of a leasehold interest as a percentage of the equivalent freehold:
- A fresh 99-year lease is worth roughly 96% of freehold.
- At 60 years remaining, roughly 80%.
- At 30 years remaining, roughly 60%.
- Below 30 years, the decline steepens sharply.
These are guide figures, not a market guarantee — location, condition and demand all move the actual number — but the shape is consistent: the erosion is slow while the lease is long and accelerates as it shortens.
The three thresholds that matter
Lease decay is not just a resale-price story. Three points in the countdown change what a buyer can actually do with the property, which is why prices react around them.
60 years remaining. Nothing breaks at exactly 60 years, but this is roughly where financing and CPF rules start to bite for the next buyer, so demand thins and the price curve bends down. If you are buying with a long holding horizon, this is the zone to think carefully about.
Covering the youngest buyer to age 95. CPF can be used in full only if the property’s remaining lease covers the youngest buyer or owner to at least age 95. If the remaining lease falls short of that, CPF usage is pro-rated downwards. Banks apply a parallel rule: the full 75% loan-to-value ratio requires a remaining lease of at least 30 years at purchase and one that covers the youngest borrower to 95 — otherwise the loan amount and the loan tenure are both cut.
20 years remaining. CPF savings cannot be used at all for a property with less than 20 years left on the lease, and bank financing at that point is minimal to non-existent. Buyers are effectively cash-only, which is why the pool of people who can purchase shrinks dramatically in the final stretch.
The practical consequence: the shorter the lease, the smaller and more cash-reliant your future buyer pool, and that is what pulls the price down well before the lease actually runs out.
HDB flats: what actually happens at the end
For HDB owners there are three things worth understanding.
Lease expiry. When a flat reaches the end of its 99 years, it goes back to HDB. There is no automatic renewal and no payout. This is the government’s stated position and it is what the resale market now prices in.
SERS (Selective En bloc Redevelopment Scheme). This is the “windfall” case people remember — HDB acquires an ageing block, pays compensation at market value and offers a new flat with a fresh lease and rehousing benefits. It is government-initiated and highly selective: only around 5% of HDB flats have ever been identified for it. It is not something to count on when buying.
VERS (Voluntary Early Redevelopment Scheme). Announced in 2018 for precincts reaching about 70 years old (roughly 30 years of lease left), VERS lets residents in a selected precinct vote on whether to have the government buy the flats back early for redevelopment. It is expected to be less generous than SERS — compensation tied to the remaining lease value with a modest top-up, and no guaranteed replacement flat. The full rules are still not finalised and the rollout is planned for the 2030s. Treat it as a managed exit, not a jackpot.
Lease Buyback Scheme. For owner-occupiers aged 65 and above, HDB will buy back the tail end of the lease for cash and a CPF top-up while the owner keeps living in the flat. The flat must have at least 20 years of lease left, household income must be within the prevailing ceiling (currently $14,000/month), and all flat types are now eligible. This is a retirement-income tool, not a general exit route.
Private leasehold: top-up or en bloc
Owners of private leasehold property have two routes to reset the clock, neither of them automatic.
Lease top-up through SLA. You can apply to the Singapore Land Authority to extend the lease back to its original term by paying a premium. Approval is discretionary — the application has to fit the government’s long-term planning intention for the site, which the URA Master Plan signals — and the premium is priced at market rates. For most condominium sites this is not a realistic individual option.
Collective sale (en bloc). In practice, the way a private leasehold estate renews itself is a collective sale to a developer, who then pays the lease top-up premium as part of redeveloping the site. This is why older leasehold condos with redevelopment potential can still command strong prices — the value is in the land and the plot ratio, not the ageing building.
The freehold alternative carries a price premium of roughly 10–20% over a comparable leasehold property in the same area. Whether that premium is worth paying depends on your holding horizon: over a typical 10–15 year hold on a lease that still has 70-plus years to run, the difference in capital outcome is often smaller than the headline premium suggests.
So, should you buy a leasehold property?
Leasehold is not a flaw to avoid. Most of Singapore’s housing is leasehold, and a 99-year lease is longer than most people’s entire ownership horizon. What matters is matching the remaining lease to your plan:
- Long lease (80+ years left), holding 10–15 years: tenure is a minor factor. Buy on location, layout and price.
- Mid lease (around 60 years left): workable, but understand that your eventual buyer faces tighter CPF and loan limits, so factor a softer exit price into the sums.
- Short lease (under 40 years left): only sensible if the price genuinely reflects it, you are comfortable with limited financing, and — for private property — there is a credible redevelopment or en bloc angle.
- HDB flat you intend to pass on: remember the lease has to cover the youngest person you want to leave it to, ideally to age 95, or their CPF and loan options are constrained.
The mistake is not buying leasehold. The mistake is paying a long-lease price for a mid-lease asset, or buying a short-lease flat expecting SERS or a lease extension to bail you out.
Frequently asked questions
Does a 99-year lease start from when I buy the property?
No. It starts from the lease commencement date, set when the land is handed to HDB or the developer. A resale flat or condo always has less than 99 years left, sometimes far less.
What happens when an HDB flat’s lease runs out?
The flat is returned to HDB with no compensation, and the lease is not renewed. SERS (which pays out and rehouses) applies to only about 5% of flats and is chosen by the government, not requested by owners.
Can I extend a 99-year lease?
Sometimes, for private leasehold land, by applying to SLA and paying a market-priced premium — but approval is not guaranteed and depends on planning intent. HDB flat leases are not extended for individual owners.
Can I use my CPF to buy an older leasehold flat?
Only partially. Full CPF use requires the remaining lease to cover the youngest buyer to age 95. If it covers them for less, CPF use is pro-rated. If the lease has under 20 years left, CPF cannot be used at all.
Is leasehold a bad investment compared with freehold?
Not inherently. Freehold carries a 10–20% price premium and holds value better in the very long run, but for a typical hold on a long-remaining lease the practical difference is modest. The tenure only becomes a real drag once the remaining lease is short enough to limit the next buyer’s financing.
Thinking about a specific flat or condo and unsure whether its remaining lease is a problem? Get in touch with Smartnest for a straight answer on the numbers — or grab our free guide to leasehold vs freehold and new launch vs resale on the same page.