Guide to Buying Private Property in Singapore

Step-by-Step Process of Buying a Private Property in Singapore

Buying private property in Singapore is a significant milestone, whether for investment or personal use. However, the process involves multiple steps, including financial planning, legal checks, and regulatory requirements. This guide from MKD Real Estate breaks down the step-by-step process to help you navigate the journey smoothly.

Step 1: Determine Your Eligibility

Before purchasing private property, ensure you meet the eligibility criteria:

Singapore Citizens & PRs: No restrictions on buying private condos and landed properties.
Foreigners: Can purchase private condominiums but need government approval for landed properties under the Residential Property Act.

Additionally, ensure compliance with the Total Debt Servicing Ratio (TDSR) and Loan-to-Value (LTV) limits, which determine your borrowing capacity.

Step 2: Plan Your Finances & Secure a Loan

Key Costs to Consider:

Property Price: Varies based on location, size, and type.
Buyer’s Stamp Duty (BSD): Up to 6% of the purchase price.
Additional Buyer’s Stamp Duty (ABSD): Ranges from 5% to 60%, depending on your residency status and number of properties owned.
Legal Fees & Agent Fees: Typically range between SGD 2,500 – 5,000.

Mortgage Planning:

Compare home loan options from banks and financial institutions.
Get an In-Principle Approval (IPA) to understand how much you can borrow.
Ensure you have at least 25% downpayment (5% in cash, 20% in CPF or cash).

Step 3: Shortlist and View Properties

With a clear budget, start searching for properties:

Use property portals, agency listings, and developer websites.
Work with a real estate agent for insights and off-market deals.
Attend showflats and property viewings to assess layout, condition, and surroundings.

Consider factors like proximity to MRT stations, schools, shopping malls, and future developments that can impact property value.

Step 4: Make an Offer & Secure the Option to Purchase (OTP)

Once you find the right property:

Negotiate the price with the seller.
Sign the Option to Purchase (OTP) agreement by paying 1% of the purchase price as an option fee.
You have 14 days to exercise the OTP by paying an additional 4% deposit.

This 5% total deposit is part of the downpayment and is non-refundable if you back out.

Step 5: Finalize Legal & Financial Processes

Engage a Lawyer

Your lawyer will conduct a title search, draft the Sale & Purchase Agreement, and ensure legal compliance.

Secure Your Home Loan

Submit loan documents to the bank for final approval.
Sign the Letter of Offer (LO) to confirm your loan terms.

Step 6: Pay Stamp Duties & Complete Transaction (OTP)

Stamp Duties must be paid within 14 days of signing the Sales & Purchase Agreement.
Remaining downpayment and legal fees must be settled before completion.
The lawyer will lodge a Caveat with the Singapore Land Authority (SLA) to confirm ownership transfer.

Step 7: Collect Keys & Move In!

Once the transaction is complete, you’ll receive the keys to your new property.
Inspect the property and address any defects before moving in.
If buying for investment, start looking for tenants or engage in a property management service.

Final Thoughts

Buying private property in Singapore is a structured but rewarding process. By understanding financial commitments, legal procedures, and market trends, you can make an informed decision. MKD Real Estate is here to guide you every step of the way, ensuring a seamless home-buying experience.

Need expert advice? Contact us today at MKD Real Estate!

FAQs

Can foreigners buy private property in Singapore?

Yes, foreigners can buy private condominiums and apartments in Singapore without restrictions. However, purchasing landed properties requires government approval under the Residential Property Act.

Can a non-resident buy a house in Singapore?

Yes, non-residents can buy private condominiums, but they are subject to Additional Buyer’s Stamp Duty (ABSD) of 60%. Landed properties and HDB flats are generally restricted to Singapore citizens and PRs.

Is private property a good investment in Singapore?

Yes, private property in Singapore is a strong investment due to stable market growth, high rental demand, and a limited land supply. However, foreign buyers should consider taxes, cooling measures, and market trends before investing.

Can tourists buy property in Singapore?

No, tourists cannot typically buy property as they do not meet the residency requirements. A foreigner would need to have a valid Employment Pass, Permanent Residency, or other long-term stay status to purchase property.

Can I buy property in Singapore without an agent?

Yes, you can buy property without an agent, but it requires extensive market research, legal understanding, and financial planning. Engaging a professional agent helps navigate negotiations, paperwork, and regulatory requirements.

What is the tax rate for foreigners buying property in Singapore?

Foreigners must pay 60% Additional Buyer’s Stamp Duty (ABSD) on top of the standard Buyer’s Stamp Duty (BSD), which ranges from 1% to 6% of the property price.

Can foreigners open a bank account in Singapore?

Yes, foreigners can open a bank account in Singapore with valid identification, proof of address, and employment or financial documents. Most banks allow account openings for expatriates, investors, and business owners.

Who is eligible to buy a condo in Singapore?

Singapore citizens, Permanent Residents, and foreigners can buy private condominiums without restrictions. However, Executive Condominiums (ECs) have eligibility rules, requiring buyers to be citizens or PRs for the first 10 years.

Can foreigners rent a condo in Singapore?

Yes, foreigners can rent condominiums and apartments in Singapore without restrictions. Many expatriates and non-residents choose to rent due to high property taxes and ABSD rates for foreign buyers.