Private Property

  • All Singapore citizens and companies can buy any type of private residential property. However, there are HDB rules and CPF restrictions that might affect a private property purchase.

For flats bought directly from HDB (including flats from the open market with or without CPF Housing Grant)

  • The flats lessees must satisfy the required occupation period for the flat before acquiring a private property (Minimum Occupation Period (MOP) – 5 years)

Foreigners or foreign companies can buy certain types of private property except landed houses which foreigners have to submit to SLA for approval.

  • As stated in the Residential Property Act, foreigners since 1973 are not allowed to purchase landed properties in mainland Singapore. An application to the Land Dealings Unit under the Singapore Land Authority (SLA) must be made if the foreigner has intentions in purchasing landed property in mainland Singapore.

The Buying / Selling Process:

1) Select an agent
Recommended even though it’s optional. A professional and licensed agent will help you to find the right property, get the best price, works in your interest, guide you through the process and make recommendations on financing and legal representation.

2) Search property and negotiate price
Before putting in an offer for the property, ensure that all important details have been discussed and agreed between all parties (Buyers and Sellers) – including extension of stay, repairs or any special requirements from both parties and the agreed completion date.

3) Sign an Option to Purchase
For Private Property – The Option to Purchase (OTP) is obtained from the seller through their lawyer or estate agent’s company. At this point, Buyer is required to pay a non-refundable option fee (normally 1% of purchase price) to the Seller. The option period is usually 14 days (number of days in the option period is negotiable).
For HDB Property – In buying and selling of a resale flat in the open market, buyers and sellers MUST use the HDB standard Option to Purchase (OTP) as the form of contract in the transaction, any other agreements and supplementary agreements relating to the sale or purchase of the flat is not valid under the Housing and Development Act. From 1st August 2012, there is a unique serial number for each HDB Option to Purchase (OTP) contract. The buyer will pay the seller an option fee of ($1,000) for the OTP.

4) Appoint a Conveyancing Lawyer
Appoint a lawyer to make all legal enquiries on the status of the seller, the title of the property, the terms of the sale and transferring the legal title of property from seller to buyer .

5) Arrange Financing
Compare different banks interest rates and special terms when choosing a finance scheme. Most banks provide fixed and floating interest rates packages for customers with different needs and requirements.

6) Exercise the Option / HDB 1st Appointment
For Private Property – After everything is agreed, upon signing the OTP contract, a 5% of the purchase price (less the option fee 1%) has to be paid to the conveyancing lawyer. Stamp duty has to be paid within 14 days of the contract.
For HDB Property – The buyer will exercise the OTP (exercise fee of $4,000). Both the buyer and seller must both attend the HDB 1st appointment. If there is a Cash Over Valuation (COV), it will be paid within 14 days after the HDB 1st appointment.

7) Legal Inspection & Completion
Buyer’s lawyer will carry out an investigation of title deeds and send requisitions to various government departments. Seller’s lawyer will also prepare the completion statement and send documents for stamping to effect completion.

8) Settle Payment and Handover / HDB 2nd Appointment
For Private Property – Any outstanding balance of the purchase price will be paid. This might be 8 to 12 weeks after exercising the OTP. Seller’s lawyer will then handover the keys and title deed of conveyance. Buyer will become the rightful owner of the new home.
For HDB Property – Completion will take place at the HDB 2nd Appointment, usually about 4 weeks after the 1st Appointment. House/Fire insurance and mortgage are settled. Stamp duty, legal fees and agent commission fees are paid. The sale is completed.