Sub-sales market boomed in 2024, sellers made average profit of $270k: OrangeTee

SINGAPORE – Sub-sales gained traction in 2024 as more opportunistic sellers cashed in on a strong price run-up in the past five years and sold their condominiums before completion, earning an average profit of around $270,000, data from OrangeTee Group showed.

Typically, a condo project takes three to four years to complete. However,

the pandemic spawned delays and disruptions

in the construction industry, causing a number of projects to take a much longer time to finish.

Consequently, sub-sales – which accounted for 6.6 per cent of overall non-landed sales in 2024 – jumped to 1,306 transactions, up from just 178 in 2020, according to OrangeTee.

Still, analysts noted that sub-sale volumes remained far below the 2007 record of 4,863 – the highest since data became available in 1996.

Condominiums in the suburbs accounted for 57.8 per cent (755 units) of sub-sale transactions in 2024, followed by city fringe properties at 38.4 per cent (502 units). The remaining 3.8 per cent (49 units) were from the prime district, OrangeTee said.

The 10 bestselling sub-sale projects in 2024 include The Florence Residences in Hougang with 159 sub-sales, Parc Clematis in Clementi (133), Affinity at Serangoon (120), and Penrose in Aljunied (100).

For the profitability study, OrangeTee calculated individual units’ gross gains and loses based on sale prices alone. The new sales caveats from the Urban Redevelopment Authority (URA) between 2019 and 2024 were matched to the sub-sale caveats of these units over the sale timeframe. The calculation excluded costs such as stamp duties, legal fees and interest.

Between 2019 and 2024, 99.3 per cent of 2,361 sub-sale transactions – or 2,344 deals – were profitable before factoring in seller’s stamp duty (SSD). Only 17 transactions were unprofitable, with losses averaging around $90,000 over the same period.

Buyers of private residential property can avoid paying SSD if they sell their properties more than three years after buying them. SSD of up to 12 per cent is payable for any home sold within three years of purchase.

The three most profitable sub-sale deals before SSD were located in the prime district. The sellers of three Boulevard 88 condos scored profits of between $3.1 million and $3.9 million after holding their nearly 2,800 sq ft luxe freehold units for three to four years, said Ms Christine Sun, OrangeTee Group chief researcher and strategist.

She noted that the most profitable sub-sale deal was for a Boulevard 88 unit that was purchased in March 2019 for $10.1 million and sold for $14 million in April 2023, reaping a $3.9 million profit.

On the flip side, the biggest loss-making sub-sale transactions were at city fringe projects Riviere and Sky Everton, with their sellers chalking up losses of $297,600 and $132,000, respectively, after they sold in 2022 within two to three years of buying the units.

One sub-sale transaction at suburban project Seaside Residences incurred a loss of $120,000 when its seller offloaded the unit in 2021 after only one year of purchase.

Eight of the 17 loss-making deals were done before the SSD period expired, as their owners may have been in financial difficulty or were in urgent need of cash, Ms Sun said.

Still, the majority of sub-sale deals were profitable and the proportion of deals with shorter holding periods increased as overall private residential prices appear to have peaked in 2024.

Between 2020 and 2024, URA’s private residential property price index rose by about 33.4 per cent.

Cushman & Wakefield research head Wong Xian Yang noted: “Some sellers who do not want to deal with the hassle of leasing may opt to cash out on their investment, realising significant gains in the process.”

According to data crunched by Cushman & Wakefield, the total number of deals for non-landed private homes with a holding period of five years or less jumped to 3,750 in 2024, from 1,010 in 2020. 

Such deals made up a bigger share of overall secondary sales with prior purchase history, rising to 34.8 per cent in 2024, from 23.9 per cent in 2020.

Median profit from such transactions jumped 17.9 per cent to $290,000 in 2024, up from $246,000 in the previous year, and more than doubled the $114,125 recorded in 2020, according to Cushman & Wakefield.

In 2025, residential property deals with shorter holding periods of five years or less could remain a substantial share of secondary sales, as owners seek to lock in their profits and cash out amid rising global economic uncertainty.

But ERA Singapore’s key executive officer Eugene Lim said that sub-sale transactions should start to moderate in the coming years, as new private home completions are expected to normalise by 2028.

In 2023,19,968 private residential units (excluding executive condominiums) were completed – the highest annual total since 2016. Another 8,460 new units were completed in 2024. In 2025, the number of new completions is expected to fall further to 5,846 units.