1 Bedroom Condos: What To Look Out For?

When considering a one-bedroom condo in Singapore, there’s more to it than just the lower price. While these condos are a great way to dip your toes into property ownership, they also come with specific risks that might make you think twice. Here, we’ll break down key factors you should consider to make sure your one-bedroom condo purchase truly aligns with your goals—whether that’s renting it out, reselling in a few years, or making it a comfortable home.

1. The Vital Importance of Location

Location plays a critical role in the success of a one-bedroom condo investment, both for rental demand and resale value. Urban, well-connected areas, especially near MRT stations and business hubs, often attract a high pool of renters. One-bedders near central business districts, like Orchard or Marina Bay, may attract expatriate tenants and professionals who prioritise convenience, even though these areas come at a higher price. However, central areas also have higher turnover, meaning units may end up with short-term tenants instead of long-term residents, which could affect resale prospects later on.

If your plan includes holding the property for a while and eventually reselling, look at areas with mixed residential types and a larger community. Developments in city-fringe or established neighbourhoods like Bukit Timah or Katong may offer a middle-ground between central convenience and long-term stability.

2. Understanding Resale and Wait-Out Periods

Buying a one-bedroom condo means you’re entering the private property market, where different rules apply if you want to switch to public housing later on. When you sell a private property, you’re required to wait 15 months before buying a resale HDB flat, and 30 months for a BTO. This requirement, aimed at balancing demand between private and public housing, can lead to complications if you need to move quickly.

Let’s say you bought a one-bedder as a single buyer, but now you’re getting married and need a larger place. You’d either have to rent during the wait-out period or find another solution, potentially incurring extra costs. This is especially important in cases where buyers don’t plan a long-term stay in their one-bedder. Having a clear plan for the future helps, especially if you’re looking at a significant life change in the coming years.

3. Balancing Unit Mix in Your Development

The composition of unit types within a development is a subtle but important factor to consider. Condos with a mix of one-, two-, and three-bedroom units create a more balanced community, appealing to both families and single occupants. In contrast, a development dominated by one- and two-bedroom units might attract a transient tenant base, which could lower appeal for buyers looking for a stable community.

For example, if most units are one-bedrooms, there’s a higher chance of intense competition among landlords. This setup can also impact resale, as buyers looking for a community-oriented environment might prefer developments with larger unit options. The presence of larger units may enhance property value over time, making them potentially better investments.

4. Navigating the Rental Market

One-bedroom condos are often considered rental-friendly due to their lower entry price and popularity among single renters and young professionals. However, Singapore’s rental market can be highly volatile, subject to government regulations, expatriate demand, and broader economic trends. For instance, the 2023 increase in Additional Buyer’s Stamp Duty (ABSD), which doubled for foreign buyers, could influence more expatriates to rent rather than buy, boosting rental demand in the short term. However, this might not hold steady if economic factors shift again.

A downturn in expatriate hiring or changes in housing allowances could reduce rental demand. During the COVID-19 pandemic, for example, demand for one-bedroom condos dropped due to travel restrictions and a downturn in expatriate employment. This shows that one-bedders aren’t immune to the rental market’s ups and downs, so it’s wise to be prepared for fluctuations.

5. Limited Influence on En-Bloc Decisions and Management

One of the often-overlooked aspects of buying a small unit is the impact it has on your say in development matters. In Singapore, condo ownership operates on a strata title basis, meaning larger units carry more voting weight in en-bloc decisions and management meetings. This means that as an owner of a one-bedroom condo, you may have less sway over property management decisions, which can influence daily experiences and the condo’s future value.

En-bloc, or collective sales, can be an attractive exit strategy if the value of land appreciates, but en-bloc decisions require an 80 percent consensus, weighted by unit size. Larger unit owners often hold more sway in these decisions, which means that smaller unit owners may feel marginalised when it comes to making big decisions, even in developments where everyone benefits equally.

6. Space Limitations and Flexibility

For single professionals, a one-bedroom condo offers sufficient space. But as life evolves, that limited space might start to feel restrictive. If family circumstances change—like marriage, children, or moving in an elderly parent—the single-bedroom layout can become a constraint rather than a comfort. Even for investors, a two-bedroom unit may appeal to a broader tenant base, including couples or small families.

One-bedroom units typically range between 400 and 600 square feet, which makes them manageable but limits their versatility. Couples or pet owners, for instance, may feel constrained over time. Additionally, Singapore’s HDB resale rules and restrictions on re-entering public housing can delay plans to move into a larger space, adding another layer of consideration before choosing a one-bedder.

7. Maximising Your One-Bedroom Condo Investment

If you’re determined to buy a one-bedroom condo, there are ways to optimise your investment potential:

• Pick a strategic location: Choose areas that are well-connected, near business hubs, or close to MRT stations. These locations are more appealing to renters who prioritise convenience.
• Aim for a balanced development: Look for condos that offer a range of unit sizes to create a more stable community. A diverse unit mix may improve resale value and appeal.
• Stay informed on policies: Keep an eye on government regulations, which could impact the rental and resale market. Singapore’s property market is sensitive to policy shifts, and being prepared helps you adapt.
• Consider the long-term value: If you’re buying a one-bedder as a stepping stone, have a clear exit strategy. Whether that’s holding on to the property for rental yield or eventually upgrading, knowing your next steps can save you time and money.

In conclusion, a one-bedroom condo in Singapore can serve as a smart investment or a cozy starter home, but it requires a close look at potential challenges. From location to resale regulations, each factor plays a role in shaping the unit’s long-term value. The right planning and understanding of market dynamics can make a one-bedroom condo a worthwhile investment, but it’s not a one-size-fits-all solution. Considering your future needs alongside current opportunities will help you make the best choice.