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Buying Resale Property

Buying resale property or called buying from resale market is under sales by private treaty. It’s slightly different from buying new property under construction from the developer. It’s called caveat emptor. That’s to say what the buyer see is what the buyer get. It’s buyer’s responsibility to examine and make sure the him to be satisfied with with property. The buyer should do due intelligence to make sure that the seller does not mislead him by misrepresentations or false statement about the property.

Here are a practical guide for your quick review and the major points that you should keep in mind.

1. Making sure you are eligible:  are you eligible to buy any private residential property?

1) Singapore Citizens who do not own a HDB flat, or have purchased a new/resale HDB flat or DBSS flat and meet the eligibility conditions and minimum occupation period set by the Housing Development Board (HDB).

2) Permanent Residents who do not own a HDB flat, or have purchased resale HDB flat and meet the eligibility conditions and minimum occupation period set by the Housing Development Board (HDB).

3) Foreigners who can purchase development-approved non-landed properties like apartments and condominiums without prior approval, or land-titled properties like houses and bungalows if they obtain approval from the Singapore Land Authority (SLA)

2. Planning your financials

Buying a private property can be a very exciting yet daunting process since it can become your biggest investment for most people and usually require a long-term financial commitment if mortgage loan is applied. Before you make such a prudent decision, you will need to do your homework to understand financial benefit and risk and your affordability to prepare you for your going-to-purchase property. Although there are quite some affluent buyers who have paid off all the payment of property at once time, majority investors will ask for personal loan from local banks. With a smaller amount of down payment and sound credit record, you can leverage your money to gain high return of investment. Read on to find how to best plan financing for your property purchase.

3. Buying procedure

Understanding the buying procedure on property investment in Singapore is necessary which can facilitate you to manage your time well with a clear process. The following is a snapshot review on the purchase process for resale private property.  Click here to read how to buy the uncompleted property from developer or the first owner.

1)   Engage a real estate salesperson or do it yourself for property search.

When look for property, a lot of factors including location of property, facilities, amenities, floor plan, façade and view, renovation condition, freehold or leasehold, age of property or TOP date and so on should be considered.  Clarity is everything.

You can get professional property agents to help you.  There are over 30 thousand real estate salespersons in Singapore, of which most of them come from the major property agencies such as Propnex, ERA, DTZ, Orange Tree, Huttons, Dennis Wee, ECG and so on.   Most of them share the similar property database in the market, you just need select one you like and trust.

Alternatively, you can search property by browsing the popular property websites like,,,, or reading newspapers such as Classified section of The Straits Times Classified, Lianhe Zao Bao.

2)   Perform due diligence check on the property and the seller’s credentials and if the owner of property is eligible to sell and you are eligible to buy.

This is straightforward but also very important. Follow the rule and the rule will protect you.

3) Make an appointment to view the property on the spot.  Seeing is believing.

Besides the above mentioned considerations and other specifications of the property, you should be cautious about if there are any illegal renovations or alterations from the seller.

4)   Make an offer for your shortlisted property

Once you find a home that you like and negotiate with the seller for a good deal, you can decide to purchase the property with the first step to get an Option to Purchase.   Like an options trading, an option to purchase is a right or option given by the seller to an intending buyer to purchase the property at a specified price within a specified period of time.  The intending buyer must pay a booking fee (e.g. 1% of the purchase price) for this right or option. The intending buyer has to exercise the Option to Purchase within its validity period (Usually 14 days) if he decides to buy the property and complete the financial and legal process. During the course of option to purchase the seller cannot sell to anyone else. When the purchase proceeds, the buyer must then exercise the option by signing and sending the purchasing documents to the seller’s solicitor together with a cheque for a further 9% of the purchase price. If buyer changes his mind, he will just forfeit the option fee.

5)  Complete the purchase

After the buyer has exercised the option to purchase, the seller and buyer enter the valid sale contract, Sale and Purchase Agreement at an agreed price. The buyer is required to pay for Stamp Duty to Inland Revenue Authority of Singapore (IRAS) within 14 days after sign the sale and purchase agreement. In most cases, your representative lawyer will arrange for payment of Stamp Duty.

Both party can then proceed on to complete the sale by making payments and transferring the Certificate of Title which is the official certificate for property ownership issued by the Singapore Land Authority from the seller to the purchaser.  At completion the Certificate of Title will be issued on payment of the final balance of the purchase price. While the buyer has applied for mortgage, the bank will retain the Certificate of Title and will release it to the purchaser when the loan is fully repaid.

4. Tax on private property

Any buyer of property is subject to a series of Singapore tax, depend on what does he deal with the property.

1)   Buyer’s Stamp Duty (BSD): the Stamp Duty is required for documents executed for a sale and purchase of property. Stamp Duty will be computed based on the purchase price or market value of the property, whichever is higher.

2)   Additional Buyer’s Stamp Duty (ABSD): This is an additional tax asked above BSD when you purchase private property, which varies from 5% to 15% depend on the citizenship and record of purchase activities.

3)   Property Tax: after becomes the owner of the property, the buyer was required to pay for annual Property Tax.  The amount of property tax is a percentage of the annual value of the property. The annual value is based on the estimated yearly rent the property can fetch if it were rented out.

4)   Rental income tax: if you lease your property, the rent received from the letting of property in Singapore is subject to income tax

5)   Gains from sale of property are taxable if a person is deemed to be trading in properties. You have to declare taxable gains from the sale of property under ‘Other income’ in your tax form.

5. Other payment and fees

Besides the purchase price, tax on property (Stamp Duty, Additional Stamp Duty, etc.), there are other payments which a buyer is required to make such as the maintenance charge, legal fees for layers, service for mortgage documentation relating to bank loan, and optional property agent service fee if you like to give.

6. Update for Singapore private property measures

The purpose of those measures is to maintain a stable and sustainable residential property market where prices move accordingly with economic fundamentals.

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