Your new launch just got its keys. Rent it out, or hold it empty for the sale?

You bought a shoebox at launch, paid in stages through three years of construction, and the keys have finally arrived. You plan to sell in a couple of years anyway. So the question is whether to bother with a tenant at all.

Leaving it empty is the easier path. No agent, no tenancy agreement, no wear, and the unit shows better to a buyer who can move in immediately. Plenty of owners do exactly that.

We worked the numbers on a real case, and the gap is larger than most people expect. Letting it out was worth about $44,600 over the hold. At a 4.5% mortgage rate, leaving it empty turned a profitable purchase into a loss.

The case

Not a hypothetical. We matched shoebox units bought at launch and resold four to six years later, using URA caveat data, and took the median of 443 purchases whose project completed three years after booking, the most common build timeline.

That is 2.71% a year on the price. What the owner actually earned depends on everything that happened in between.

Why a launch purchase is different

Before the two scenarios, the thing that makes this work at all.

A resale buyer hands over 25% of the price at completion and takes the full loan immediately. A launch buyer pays in stages tied to construction, and the loan draws down as each stage falls due.

In the first two months the buyer needed $165,270 including stamp duty and legal fees. Everything from month 15 came from the loan.

The practical consequence is interest. Over five years at 1.5%, this buyer paid $19,440. A resale buyer with a loan fully drawn from day one, on a similar unit, paid more than twice that over a comparable period. The loan simply was not outstanding for most of the time.

Scenario one: let it out

The unit sat empty for two months after completion while a tenant was found, then let for the remaining 22 months of the hold.

One cost people forget: a unit sold with a tenant in place sells to a narrower pool, because an owner-occupier cannot move in. We assumed a 1.5% discount on the sale price for that, roughly $12,500.

Scenario two: leave it empty

No rent for 24 months. Maintenance, upkeep and property tax still payable throughout. Sale at the full price, vacant, to any buyer.

The result

In cash terms, letting out was worth about $44,600 at every rate.

The comparison holds two years of rent, $46,867, against a $12,500 discount for selling tenanted. The rent is worth roughly three and a half times what the tenanted sale costs you.

At 4.5%, the empty unit lost money on a property whose price rose $104,320. The interest and holding costs ran for five years with nothing coming in to offset them.

How wrong would the discount have to be?

The 1.5% haircut for selling with a tenant is our assumption. Caveat data does not record whether a unit sold vacant or tenanted, so it cannot be measured. But it can be tested.

At a 1.5% mortgage rate, letting out only stops winning once the tenanted-sale discount exceeds about 5.5%. At higher mortgage rates it wins by more, because the rent offsets interest the empty unit is paying anyway.

A 5.5% discount for having a tenant in place would be extreme. The conclusion holds across any plausible figure.

If it was a second property

Most launch purchases of this size are investment purchases. A Singapore citizen buying a second residential property in 2018 paid additional buyer's stamp duty of 12%, $87,480 on this unit, in cash, at booking.

Every scenario is a loss. The duty alone consumed 84% of the entire paper gain before a dollar of interest was paid.

That rate has since risen to 20% for citizens buying a second property, and 60% for foreign buyers.

What this does and does not tell you

Everything past the four measured figures is an assumption, and yours will differ on every line: your rate, your loan, your rent, your duty position, your project's build timeline.

Three years to completion is the median. A project running four years gives you one year of rent instead of two, and that changes the answer.

Income tax on rental income is not modelled here. It reduces every figure in the let-out column.

And this describes a purchase made around 2018 and sold around 2023, at duty rates that no longer apply. It is what happened, not a forecast.

What it does say plainly is this: if you are holding a completed launch unit and thinking of leaving it empty until you sell, that decision is worth about $44,600 on a $729,000 purchase. It deserves more thought than it usually gets.

About this analysis. The four measured figures come from URA caveat data, matched so both the purchase and the sale are the same unit. Every one can be reproduced from source. Realila publishes the full working, including the assumptions above and what we have got wrong and corrected.

The full worked example, with every cost itemised
How we measure