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Must Know About Buying Property in Singapore

Things you should know before buying a property in Singapore

There are several factors that will influence the actual cost of buying a studio apartment. Singapore enforces different rules for families and single individuals, particularly for those who plan to buy a Housing & Development Board (HDB) flat.

Aside from marital status, the price of buying your first apartment will depend on your income and the type of property. Some of the common types of apartments include mature and non-mature build-to-order (BTO) flats, Design, Build and Sell Scheme (DBSS) flats, and Executive Condominiums (EC). The HDB offers 99-year leasing deals for these properties.

HDB Rules on purchasing property in Singapore

The Rules and Requirements

HDB has imposed new income ceilings for buying flats, which means more people have access to housing options. A typical family who plans to buy a new flat shouldn’t earn more than $14,000 per month. The same income ceiling applies to a purchase of a resale flat on the open market with CPF Housing Grant.

Single buyers who are 35 years old and above shouldn’t earn more than $7,000 per month if they plan to buy a new two-room Flexi flat in a non-mature property. A non-mature estate simply means that there are fewer facilities than in mature properties. This is also the reason why it’s more expensive to buy an apartment in a mature estate.

Those who are orphans and have no siblings can apply for an HDB purchase upon turning 21 years old, pursuant to the Orphan’s Scheme. If you and a friend plan to be roommates, then a joint applicant is possible for up to four unrelated people under the Joint Singles Scheme.

Types of appartements can influence pricing

The Prices of Properties

There are limited prices for a BTO studio apartment either in a non-mature or mature estate in Singapore. ECs and private condos (PC) cost at least $420,000 and $600,000, respectively. These are already too expensive for median-income earners. A BTO HDB Flexi flat may cost around $75,000 to $158,000 depending on the location. A drawback of buying this kind of property requires a long waiting time of at least three years.

The units are also restricted to two-room properties between 35 square meters and 45 square meters. Competition among buyers is also noticeable because of fewer units, and you can’t sub-let your house when you acquire one. A resale two-room HDB flat may cost between $250,000 and $343,00 on average. You can buy in as fast as six months without any restrictions on the number of rooms starting from three-room units.

You can also sub-let a resale flat, but the possibility of buying a property with defects is much higher because another person previously owned it. An HDB renovation may be expensive as well because of existing fixtures that may need replacements.

If you plan to buy a BTO flat in a non-mature district, the average price for a three-room property will cost from $150,000 to $190,000. Four-room properties may cost between 295,000 and $350,000, while five-room units may cost from $390,000 to $500,000.

BTO flats in mature districts may cost $200,000 to $300,000 for three-room apartments. Four-room units may cost between $290,000 and $320,000, and five-room apartments may range from $400,000 to $550,000.

Factors Affecting Prices of Resale property

Factors Affecting Prices of Resale Flats

By now, you may be thinking of just buying a resale flat to avoid long waiting times and have more options. Those who decide to acquire one should be prepared to spend more money. Resale flats are more expensive because real estate prices appreciate every year. Some properties in Singapore, particularly those in the central business district, may even have higher prices after just several months!

Owners of resale flats also place a premium, which is called a Cash Over Valuation (COV), in addition to the actual property value. Some sellers may put up to $50,000 premiums on the price tag, but there are properties with no COVs. If you see a listing on a zero-premium unit, you should expect bids to pour in from several buyers. Many are willing to pay a higher price than the seller’s quoted figure, especially if the unit is in a strategic place (e.g. near an MRT station).

How much should you save before purchasing a property?

How Much Should You Save?

You should set aside at least 5% of the unit’s purchase price for cash down payments. If you borrowed money through an HDB Concessionary Loan, you will be required to pay 10% upfront. You can use cash, a CPF Ordinary Account, or a combination of both to settle the down payment. Singaporeans or permanent residents who borrowed money from a bank or legal money lender should pay 25% of the property’s price.

The option fees for buying a flat range from $500 to $2,000 depending on the number of rooms. This should be included in the price of a down payment. First-time buyers should also consider legal fees when making a budget. Some of them include stamp duty for 99-year lease agreements, conveyancing fees and a caveat registration fee.

You can calculate stamp duty by taking 1% for the first $180,000 of the purchase price, 2% for the next $180,000 and 3% for the next $640,000. If you bought an apartment for $200,000, you should get 4% of the remaining amount. The same calculation applies to prices that fall in between the percentage brackets. You can also use the Inland Revenue Authority of Singapore’s Stamp Duty Calculator to check the estimated price.


As prices of rooms for rent in Singapore continue to increase in some areas, it makes sense for people to buy apartments for themselves. If you still need cash to fulfil a down payment, then call us today to find out how we can offer the best monthly loan. Our rates are competitive and reasonable, as we are regulated by the Monetary Authority of Singapore.

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