How to Tell If a Condo Is Fairly Priced
Every listing has an asking price, and every asking price is a hope, not a fact. Telling whether a condo is fairly priced is not about instinct or the agent's reassurance. It is about evidence, mostly what comparable units have actually sold for, adjusted for the things that make one unit worth more than another. This is how to tell whether a condo is fairly priced.
Start with what sold, not what is asked
The asking price tells you what the seller wants. What comparable units have recently transacted for tells you what the market pays. Those are different numbers, and the gap between them is the seller's optimism. Begin with recent transacted prices for similar units in the same development and nearby comparable ones, ideally within the last several months. That evidence, not the listing, is your baseline.
Compare on price per square foot
To compare fairly, use price per square foot rather than the total price, because it strips out size. A bigger unit costs more in total but may be cheaper per square foot, and a small one can look cheap in quantum while being expensive per foot. Work out the PSF of the unit you are weighing and line it up against the PSF of recent comparable transactions. That single step cuts through most of the noise.
Adjust for the differences that matter
No two units are identical, so the comparison needs adjusting for the things that genuinely move value:
- Floor. A higher floor usually carries a premium, so compare like with like or adjust for it.
- Facing and view. A better aspect, or avoiding the afternoon sun, is worth a premium, a poor one a discount.
- Size. Smaller units tend to carry a higher PSF, so do not compare a compact unit directly with a large one.
- Remaining lease. A leasehold unit with a shorter lease should price below a fresher one, and below freehold.
- Condition. A renovated unit commands more than a tired one, but only up to a point.
A fair price is the comparable evidence, nudged up or down honestly for these differences.
Use rental yield as a sanity check
Even for an owner-occupier, rental yield is a useful cross-check. Work out the gross yield the unit would produce, annual rent over price, and compare it to similar units. If the yield is markedly lower than comparable properties, the price may be running ahead of the rent the market will pay, a sign it is on the high side. It is a second opinion, not the whole answer, but it often catches an inflated price.
Mind the renovation premium
A beautifully renovated unit is tempting, and sellers price the renovation in. Two cautions. First, you are paying for someone else's taste, which you may change anyway. Second, renovation rarely returns its full cost at resale, so a heavy renovation premium is often not fully justified by value. Pay something for a good, usable renovation, but do not pay as if it were worth its original cost, and never let the finish distract you from the underlying price per square foot.
New launch pricing needs a different lens
Comparing a new launch to resale is not apples to apples. New launches usually price at a premium to surrounding resale, for newness, the developer's brand and the phased payment. Some of that premium is reasonable, some is simply the cost of new. The honest test is whether the premium over comparable resale is one you are willing to pay for what you actually get, not whether the new launch is cheaper than nothing.
Pressure-testing an asking price.
| Check | What it tells you |
|---|---|
| Recent transacted PSF for similar units | The market's actual price, not the asking |
| Floor and stack differences | Whether a premium or discount is justified |
| Remaining lease | Whether a leasehold price reflects its age |
| Condition and renovation | How much of the price is fittings you may not value |
| Gross rental yield | Whether the price makes sense against the rent |
Red flags that a price is off
A few signs suggest an asking price is ahead of fair value:
- It sits well above recent transacted PSF for genuinely comparable units.
- The premium rests mainly on renovation or styling rather than the unit itself.
- The gross yield is noticeably worse than similar properties.
- The listing has sat on the market while comparable units sold.
- The justification is all story and no evidence.
None of these is proof on its own, but together they are a reason to negotiate hard or walk.
A considered view
A fair price is not a feeling, it is a conclusion you reach from evidence: what sold, compared on PSF, adjusted for the real differences, and sanity-checked against yield. Do that work and you will know whether an asking price is reasonable, rich or a genuine opportunity. If you are weighing a specific unit, I am happy to pull the comparable transactions and work through whether the price stacks up before you make an offer.
Douglas Chow is a licensed real estate professional in Singapore who advises buyers and sellers with an honest, objective approach. He helps clients weigh the real numbers behind residential and commercial property decisions.
Ask Douglas to check if a price stacks up