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How to go about Buying Property in Singapore – Your Complete Guide

Buying property in Singapore can be a very challenging process and a decision that must be carefully weighed down.

Take into account that if you do buy a home, there are extra responsibilities and costs that go along with being an owner such as home maintenance, repairs and long-term commitment. However, once you find your ideal home, the rewards will be priceless!

Ready to take the plunge? Our step-by-step guide has been designed to smoothly walk you through the process of buying property in Singapore. 

Step 1: Start with research

buying property in singapore

Spend some time researching on the areas you are interested in living in and what type of properties you think you might want. Come up with a shortlist of the things that matter to you in a home; this will help you a great deal when you start viewings.

It’s really important to come up with a list of features you need in a house. How many bedrooms do you need? How big do you want your kitchen? 

Once you’ve made a list of the must-have features, think about the kind of neighbourhood you want to live in, the commuting time to and from your work, and the nearby amenities. 

Step 2: Figure out what properties you can buy

When you’re looking for a house for sale in Singapore, know that there are a few different property types:

Public Housing or HDB 

  • Public housing or HDB apartments – this stands for Housing Development Board and is used as short-hand to describe any government housing in Singapore. These are not available for foreigners to purchase.

Public-Private Hybrid

  • Executive condominiums – a public-private hybrid property, which foreigners can only purchase 10 years after completion of construction. The executive condominium shares most of the design and facilities of a private condominium with the edge of being HDB-issued. Executive condominiums come with a 5-year Minimum Occupation Period (MOP), which means that you have to live in it for at least 5 years before you are granted the rights to sell it on the open market to Singapore Citizens and PRs.

Singapore property

Private Residential Housing

  • The different types of private residential property can be subdivided into two main cadres: landed property and condominiums/apartments. Condominiums and apartments are really popular with private property enthusiasts. These are basically the more luxurious version of the HDB flats. If you want to buy a condo in Singapore, these do not have restrictions on foreign ownership and are the common choice for expats.

Landed properties

  • Landed properties include bungalows, houses, cluster houses, terrace houses and shophouses. While these require more maintenance, they are also considered unrivaled in terms of size, spacious living and privacy. While Singaporeans can purchase landed properties without restrictions, foreigners are required to seek approval from the Land Dealings Authority Unit before they can purchase, unless the house is part of a larger condominium project, or located at Sentosa Cove. For these properties, buyers can obtain a fast-track approval from the Singapore Land Dealing Unit.

Note that if you want to rent a house in Singapore, private properties are available to all foreigners and expats, while public housing such as HDBs do have more regulations.

Step 3: Determine your budget and how much you can afford

buying property in singapore

After some thorough research, you have some locations in mind and thought about the style of home that suits you best. Now it’s time for some practical planning. Before you start looking at houses, you need to figure out your budget and stick to it.

You can start by using an affordability calculator tool, which lets you calculate what you can afford. The calculator factors in government regulations to check how much loan you can get, as well as the taxes and duties that you are required to pay, so it will make your life easier.

Step 4: Get the right mortgage for your situation

singapore property in singapore

Many prospective homeowners who apply for a mortgage tend to show concerns before they agree to sign. A common question is “how much interest will I end up paying?”

Chances are you won’t be able to calculate these figures off the top of your head, but you can use a mortgage calculator that can help you quickly and easily answer these questions. 

Also, take note that a house for sale in Singapore isn’t cheap. You can expect the downpayment to be around 20% of the full price of the property!

Step 5: Take note of the property valuation

Check the indicative valuation for the property you are intending to buy. Valuation directly affects the amount of loan you can get for the property. Take into account the number of years that you can loan, the monthly instalment, etc.

For individual borrowers who have no outstanding housing loans, the Loan-to-Value limit is 80%, or 60% if the loan tenure exceeds 30 years or the loan period extends beyond the borrower’s retirement age of 65.

Step 6: Figure out the rental yield 

It’s important to think long-term and anticipate your actions in the future. Will you want to rent your house at some point in time? If yes, it’s better to calculate the rental yield and know whether it’ll be easy to rent the property out. 

If you want to buy a house in Singapore for investment, prime districts such as the Central Business District are your safest bet. Properties with sea view at the East Coast are also great for a resort home or investment.

You can start by calculating the yearly rental yield versus the purchase price. Due to the premium in price for freehold properties, these are most likely have lower rental yields than leasehold properties.

Step 7: Find a good real estate agent

One of the most critical steps in renting property in Singapore is finding a great property agent to represent you. Real estate agents are important partners when you’re buying properties as they will work to get you the best deal.

When buying property in Singapore, agents can provide you with helpful information on the Singapore property market and neighbourhoods that aren’t easily accessible to the public. Their knowledge of the home buying process, negotiating skills, and familiarity with the area you want to live in can be extremely valuable.

Besides, your agent will walk you through the entire process from helping you shortlist properties to negotiating and post move-in support.

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Step 8: Negotiate and make an offer 

After the agent has shortlisted all the properties and you have spent enough time viewing prospective homes, you have finally set your eyes on one of them. Take a step back to logically look at all the things that matter before making your final offer. This is also the time when your agent will negotiate a fair offer for you. 

Be sure to check if the owner is in a hurry to sell or have been trying to sell for a long time. If yes, they may be willing to accept a lower offer to make the sale. Sellers who are not in a hurry to move are more likely to hold out for a higher price!

Step 9: Conduct a home inspection

Many buyers fail to realise the importance of the home inspection. You are now at the stage where you’ve found a house or condo for sale and you are certain it’s the one you want. Once an offer is accepted, your property agent will help you arrange the home inspection to be conducted within a few days of your offer being accepted by the seller.

This will also protect you by giving you a chance to renegotiate your offer or withdraw it without penalty if the inspection determines the prospective house to have material damages.

Step 10: Completing the sale

buying property singapore

Option to Purchase

buying property in singapore

Before the purchaser can proceed on to apply for the Certificate of Title, the purchaser will need to enter into a valid and binding real estate contract (drafted by lawyer), in the form of Option to Purchase (OTP).

The Option to Purchase is a right or option given by seller of a property – who can be an individual or a developer – to an intending purchaser to buy the property.

Before purchasing the property, you will be asked to put down a deposit in the form of an Option to Purchase. The OTP is typically 1% of the sale price to be paid to the seller at the point of receiving the agreement.

The OTP will last 3 weeks. Within this time, the buyer must come up with the rest of the money for the house. In the instance you choose to back out of the deal, up to 25% of the deposit will be forfeited.

Keep in mind that it is important to have an AIP or an Approval-in-Principle, which is essentially a promise by a bank to loan you a certain amount if you buy a house within the decided timeframe. Don’t forget to get the AIP from the bank before signing the OTP!

Here are some things at a glance about the OTP:

  • The cost is usually 1% of the property’s agreed purchase price.
  • All intending purchasers must be named in the Option.
  • Option is valid for 3 weeks from delivery of the Sale & Purchase Agreement to the purchaser.
  • To exercise the Option, the Sale & Purchase Agreement has to be signed and the downpayment balance paid.

After signing the OTP, you will enter into the Sale and Purchase Agreement. This involves your payment of a deposit, and setting the dates for fees such as the stamp duties.

Sale & Purchase Agreement

The Sales & Purchase Agreement is the second phase and in this regard, the solicitor will embark upon the necessary steps to complete the sale such as coordinate with the bank/CPF board for the mortgage and preparation of the contracts. The entire process will typically take up to 10 weeks to complete.

Some things to note about the Sale & Purchase Agreement:

  • The purchaser should obtain a written confirmation from the developer if there are items offered by the developer which are not stated in the Sale & Purchase Agreement.
  • A precise legal description of the property being sold must be included in the real estate agreement. This description should be as detailed as possible and should make mention of the legal identification of the property.
  • The purchase price should be explicitly stated in the agreement, by appearing in both text and numbers so as to avoid potential confusion.
  • The purchaser must ensure that payments due to the developer are made promptly according to the payment schedule in the Sale & Purchase Agreement.
  • The purchaser has to inform the developer if he/she sub-sells the unit before completion of the sale of the unit has taken place.
  • Information about the mortgage used by the buyer should also be present in the agreement, along with any contingencies. Contingencies should be declared, especially with regard to loan approval.
  • The full and correct names of both parties must be stated clearly. This includes hyphens, any designations and aliases which either party might be using. While seemingly trivial, this is actually rather important.
  • The purchaser of a strata-titled property should note the share value allocated to the unit as this determines the maintenance charges payable.

 Step 11: Stamp Duty 

buying property in singapore

There are other fees payable when purchasing a residential property, such as stamp duty.

There are three layers of stamp duty in Singapore: the Buyer’s Stamp Duty (BSD), Additional Buyer’s Stamp Duty (ABSD), and the Seller’s Stamp Duty (SSD). Only the first two are payable by the buyer.

The BSD is levied at the following rates:

  • First S$180,000 1%
  • Next S$180,000 2%
  • Remaining amount 3%

The tax payable by the buyer regardless of whether you are a Singaporean citizen, Permanent Resident, or Foreigner.

The ABSD is only applied to residential property, where foreigners pay 15% tax duty for any residential property, regardless of volume, while Singaporean citizens and permanent residents pay 0% and 5% respectively for their first purchase, 7% and 10% for their second one and 10% for any purchase thereafter.

If you’re a citizen or permanent resident of countries under certain free trade agreements, such as Iceland, Lichtenstein, Norway, Switzerland and the USA (citizens only), you’ll be exempt from ABSD.

Stamp Duty must be paid in full within 14 days of the Option to Purchase or Sale and Purchase Agreement being signed or from the date of transfer.

Rates and computation at a glance

BSD and ABSD Rates
 Profile of the Buyer  BSD Rates ABSD Rates ABSD Rates
Singapore Citizens (SC)1 buying first residential property 1% on first $180,000

2% on next $180,000

3% for the remainder

N/A  N/A
SC1 buying second residential property N/A  7%
SC1 buying third and subsequent residential property  3%  10%
Singapore Permanent Residents (SPR)1 buying first residential property  N/A  5%
SPR1 buying second and subsequent residential property  3%  10%
Foreigners (FR) and entitiesbuying any residential property  10% 15%

 1  Whether owned wholly, partially or jointly with others.

2 An Entity means a person who is not an individual. It includes the following:

  • An unincorporated association,
  • A trustee for a collective investment scheme when acting in that capacity
  • A trustee-manager for a business trust when acting in that capacity
  • The partners of the partnership whether or not any of them is an individual, where the property conveyed, transferred or assigned is to be held as partnership property

    3
      BSD and ABSD are to be rounded down to the nearest dollar.

*Do note that all government taxes are subject to change.

Step 12: Certificate of Title 

buying property in singapore

After a price has been agreed between seller and purchaser, both parties can proceed to complete the sale by making payments and transferring the Certificate of Title (CT) from the seller to the purchaser. The CT is issued by the Singapore Land Authority.

Inspection of the Certificate of Title

The Certificate of Title (CT) is the only legal document that proves property ownership. Hence, after the purchaser has accepted the Option to Purchase (OTP), the CT will be handed over to the purchaser’s lawyer for inspection. Usually, the purchaser’s lawyer will hold on the CT until legal completion where the old CT is surrender to the Singapore Land Authority (SLA) for the purpose of reissuing a new CT to the new owner.

Step 13: Close the deal

From then on, leave it to your solicitor for the completion of the sale, which will be completed in around 8 to 10 weeks time (agreement between the vendor and purchaser). Now, your solicitor will lodge a caveat on the property, coordinate with the financial institution, CPF board (if applicable), prepare the mortgagor/mortgagee documents.

Congratulations, you’ve found your ideal home and you can now move in. You deserve to celebrate!
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Also published on Medium.

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