Does tearing down and rebuilding pay?
A brand-new landed house sells for far more per square foot of land than the tired one next door. The rebuild play is capturing that gap for less than it costs to build. Here is the premium the market actually pays for new landed — by district — netted against a construction-cost benchmark.
The premium the market pays for new
Median land $psf of newly-built landed (Sale Type = New Sale) versus existing stock (Resale), by district, land-titled sales since 2019:
| District | New $psf | Resale $psf | Premium | Uplift / land sqft |
|---|---|---|---|---|
| D10 | $3,134 | $2,036 | +54% | $1,098 |
| D11 | $3,227 | $2,145 | +50% | $1,082 |
| D5 | $2,538 | $1,601 | +59% | $937 |
| D20 | $2,567 | $1,715 | +50% | $852 |
| D15 | $2,631 | $1,849 | +42% | $782 |
| D28 | $2,242 | $1,484 | +51% | $758 |
| D14 | $2,214 | $1,580 | +40% | $634 |
| D19 | $2,171 | $1,557 | +39% | $614 |
| D23 | $1,844 | $1,292 | +43% | $552 |
| D13 | $2,138 | $1,666 | +28% | $472 |
Does the uplift cover the build? — rebuild spread by district
The rebuild only pays if the new-vs-old uplift beats what it costs to build. Netting a central construction benchmark ($400/sqft GFA × 1.4 buildable = $560/land sqft) against the uplift, per land square foot:
| District | Uplift | Build cost | Gross spread | After duties/fees* | Read |
|---|---|---|---|---|---|
| D10 | $1,098 | −$560 | +$538 | +$338 | Positive |
| D11 | $1,082 | −$560 | +$522 | +$322 | Positive |
| D5 | $937 | −$560 | +$377 | +$177 | Positive |
| D20 | $852 | −$560 | +$292 | +$92 | Marginal |
| D15 | $782 | −$560 | +$222 | +$22 | Marginal |
| D28 | $758 | −$560 | +$198 | −$2 | Marginal |
| D14 | $634 | −$560 | +$74 | −$126 | Negative |
| D19 | $614 | −$560 | +$54 | −$146 | Negative |
| D23 | $552 | −$560 | −$8 | −$208 | Negative |
| D13 | $472 | −$560 | −$88 | −$288 | Negative |
*Further −$200/land sqft rough allowance for acquisition stamp duty, selling costs and holding — before your own ABSD, which can swing the answer entirely.
New-build activity
Land-titled New Sale landed per year — a rough gauge of new-build and redevelopment completions reaching the market:
New-built landed sales per year
Rebuild pipeline — from planning permissions
The authoritative signal, not a proxy: URA Written Permissions for landed. New erections and reconstructions are teardown/new-build approvals — a leading indicator of redevelopment that shows up years before any sale. Additions & alterations keep the existing house and are excluded from the rebuild count.
Landed rebuild permissions per year
Investor verdict
Treat rebuild as a land-and-construction arbitrage that only works at the top. Where the new-vs-old premium is largest — the prime landed districts — the uplift can clear construction and costs with room to spare; elsewhere it is thin to negative once duties and your own ABSD are counted.
Buy the worst house on the best street, price the land off the resale (old-stock) comps, cost the build at the tier your finish demands, and only underwrite the new-build exit at the district’s actual New Sale $psf — not a hoped-for number. The authoritative rebuild-history layer (URA Planning Decisions) is the next build and will let us flag which addresses were already rebuilt.
How to use this before you buy
Price the land off old-stock comps
Your acquisition should reflect resale (old) $psf, not the new-build number — you are buying the land, not the finished house.
Cost the build to your finish tier
Construction runs roughly $330–490/sqft GFA by specification. A luxury finish erases a mass-market spread — match the tier to the district.
Underwrite the exit at real New Sale $psf
Use the district’s actual new-built median above as your exit, and haircut it — a single finished house doesn’t always fetch the top of the range.
Count your own stamp duty
ABSD on the acquisition can dwarf the construction saving. Run your position through the stamp-duty rules before committing.