Making a downpayment for a condo is one of the first financial commitments you have to make when purchasing this type of private property in Singapore. It’s no secret that purchasing property in the +65 is particularly expensive, but exactly how much of the bill do you have to foot upfront?
In this article, we’ll break down the initial costs of buying a condo, including the downpayment you have to make. This way, you’ll better understand how your citizenship status, your existing number of homes and property loans work hand-in-hand to affect the downpayment for a condo you wish to purchase.
Related article: HDB to EC, Condo, or Landed Property: How Much Must You Save to Upgrade in Singapore (2022)
Buying Non-landed Private Property: What Affects the Cost of a Downpayment for a Condo in Singapore
1. Additional Buyer’s Stamp Duty (ABSD)
Your citizenship and number of existing homes have a bearing on your upfront cost because these have a direct correlation on whether you need to pay ABSD and your corresponding tax rate.
This tax was first implemented on 8 December 2011 by the government to dampen the robust property investment demand by Singapore citizens and foreign buyers. Another reason for its introduction is to maintain housing affordability for locals and to let home prices grow sustainably along with economic fundamentals.
In December 2021, another round of cooling measures was implemented, which saw higher ABSD rates, lower Loan-To-Value (LTV) limits and a tighter Total Debt Servicing Ratio (TDSR) threshold. The latest ABSD rates are displayed below:
Current ABSD Rates
|
Type of buyer |
ABSD payable (on or after 16 December 2021) |
|
Singapore Citizen buying first property |
No need to pay ABSD (no change) |
|
Singapore Citizen buying second property |
17% |
|
Singapore Citizen buying third and subsequent properties |
25% |
|
Singapore Permanent Resident (PR) buying first property |
5% (no change) |
|
Singapore Permanent Resident (PR) buying second properties |
25% |
|
Singapore Permanent Resident (PR) buying third and subsequent properties |
30% |
|
Foreigner buying any property |
30% |
|
Entities (company or association) buying any property |
35% (additional 5% if entity is housing developer; non-remittable) |
With the ABSD rates above, a first-time Singaporean that’s buying a condo in Singapore (the first property) doesn’t need to pay anything. But if you’re purchasing a second home, you face a 17% tax. Assuming you intend to buy a $1 million condo as your second house, you need to pay $170,000 worth of ABSD.
As for permanent residents (PR), they are required to fork out a 5% tax for their first home purchase. For their second property purchase, PRs will have to pay 25% tax; for third and subsequent home purchases, PRs will have to pay 30% tax.
On the other hand, foreigners must pay a 30% ABSD each time they purchase a residential property here. That means for a $1 million condo in Singapore, foreigners will need to pay $300,000 in ABSD.
Related article: What You Need to Know if You’re Buying Property in Singapore as a Foreigner (2022)
Therefore, it’s easy to see why most foreign property investors prefer buying commercial properties over private property as the ABSD doesn’t apply to such assets. If you are seeking commercial properties, please check CommercialGuru or read our commercial property buying guide.
There are, of course, exceptions to ABSD. For example, under the Free Trade Agreements (FTAs), citizens or permanent residents of Switzerland, Liechtenstein, Norway, Iceland or the United States don’t need to pay any ABSD for their first home purchase.
Other methods include decoupling, buying under a child’s name, and as mentioned above, buying a commercial property.
2. Buyer’s Stamp Duty
While the ABSD exempts some categories of home buyers, no one is exempt from paying the Buyer’s Stamp Dutyu (BSD), whether you’re a Singapore Citizen, PR or foreigner. This is because the documents affecting the transfer of ownership over the property must be stamped to make it official.
The BSD will be calculated based on the purchase price stated in the instrument to be stamped or the property’s market value, whichever is higher.
If you received a monetary discount on the selling price, it will be taken into account when computing the tax, provided that the net price still reflects the property’s actual market value.
Please note that cash discounts must be stated in the documents to be stamped, otherwise it won’t be taken into consideration when computing the BSD. Below are the current BSD rates:
| Purchase Price or Market Value | BSD (Residential) | BSD (Non-residential) |
| First $180,000 | 1% | 1% |
| Next $180,000 | 2% | 2% |
| Next $640,000 | 3% | 3% |
| Remaining Amount | 4% |
Source: Inland Revenue Authority of Singapore
Assuming you purchased a private condo that is being sold for/valued at $1 million, you need to fork out a BSD of $24,600. Here’s the breakdown for calculating the BSD for this particular example:
($180,000 x 1%) + ($180,000 x 2%) + ($640,000 x 3%) = $24,600
Alternatively, you can use an online BSD calculator to check how much you would have to pay.
*note, if the property that you’re buying is below $1 million, here’s a shortcut method:
(3% x purchase price or market value) – $5,400
3. Loan-to-Value and Minimum Cash Downpayment
Apart from the unit selling price, another factor that will have the greatest bearing on how much downpayment for a condo you need to pay is the Loan-to-Value (LTV) limit, which is based on the number of outstanding home loans you have. This will also affect your minimum cash downpayment.
The particulars are indicated below:
|
Outstanding Housing Loans |
LTV Limit |
Minimum Cash Downpayment |
|
0 |
75% or 55%* |
5% (for LTV of 75%); 10% (for LTV of 55%) |
|
1 |
45% or 25%* |
25% |
|
2 or more |
35% or 15%* |
25% |
*Take the lower LTV limit only if the loan tenure exceeds 30 years (25 years for HDB flats), or the loan period extends beyond the borrower’s age of 65.
Source: Monetary Authority of Singapore
So for instance, if your LTV is 75% (loan tenure is up to 30 years and doesn’t extend past the borrower’s age of 65), this means you need to pay the 25% shortfall in cash and/or CPF Ordinary Account savings. If the condo you are buying is being sold for/valued at $1 million, this means your downpayment due is $250,000.
At least 5% of this 25% shortfall has to be paid in cash to fulfil the minimum cash downpayment. So out of the $250,000 due, you will have to pay at least $50,000 in cold, hard cash.
Case Study: Breakdown of a Condo Downpayment
The total initial cost takes into account downpayment (cash/CPF), BSD, ABSD, Mortgage Stamp Duty, mortgage stamp duty, cost of property valuation and legal fees. Property valuation fees can cost anywhere from $300 to $500, while legal fees are an estimated $3,000.
In the below case studies, it is assumed that the property you would like to purchase a $1 million condo unit. Here is the cost breakdown, excluding mortgage stamp duty, property valuation and legal fees.
Buying Non-landed Private Property: Upfront Cost for Singapore Citizens (SC)
|
Buyer Group |
SC Buying 1st Home |
SC Buying 1st Home* |
SC Buying 2nd Home |
SC Buying 2nd Home |
|
BSD amount |
$24,600 |
$24,600 |
$24,600 |
$24,600 |
|
ABSD % |
– |
– |
17% |
17% |
|
ABSD amount |
– |
– |
$170,000 |
$170,000 |
|
1st Loan Paid? |
– |
– |
Yes |
No |
|
LTV |
75% |
55% |
45% |
25% |
|
Downpayment for Condo Property Loan |
$250,000 |
$450,000 |
$550,000 |
$750,000 |
|
Min Cash Downpayment % |
5% |
10% |
25% |
25% |
|
Total Upfront Cost |
$274,600 |
$474,600 |
$744,600 |
$944,600 |
*Take the lower LTV limit only if the loan tenure exceeds 30 years (25 years for HDB flats), or the loan period extends beyond the borrower’s age of 65.
Buying Non-landed Private Property: Upfront Cost for Singapore Permanent Residents (PR)
|
Buyer Group |
PR Buying 1st Home |
PR Buying 1st Home* |
PR Buying 2nd Home |
PR Buying 2nd Home* |
|
BSD amount |
$24,600 |
$24,600 |
$24,600 |
$24,600 |
|
ABSD % |
5% |
5% |
15% |
15% |
|
ABSD amount |
$50,000 |
$50,000 |
$150,000 |
$150,000 |
|
1st Loan Paid? |
– |
– |
Yes |
No |
|
LTV |
75% |
55%* |
45% |
25% |
|
Downpayment for Condo Property Loan |
$250,000 |
$450,000 |
$550,000 |
$750,000 |
|
Min Cash Downpayment % |
5% |
10% |
25% |
25% |
|
Total Upfront Cost |
$324,600 |
$524,600 |
$724,600 |
$924,600 |
*Take the lower LTV limit only if the loan tenure exceeds 30 years (25 years for HDB flats), or the loan period extends beyond the borrower’s age of 65.
Buying Non-landed Private Property: Upfront Cost for Foreigners
|
Buyer Group |
Foreigners Buying 1st Home |
Foreigners Buying 1st Home* |
Foreigners Buying 2nd Home |
Foreigners Buying 2nd Home* |
|
BSD amount |
$24,600 |
$24,600 |
$24,600 |
$24,600 |
|
ABSD % |
30% |
30% |
30% |
30% |
|
ABSD amount |
$300,000 |
$300,000 |
$300,000 |
$300,000 |
|
1st Loan Paid? |
– |
– |
Yes |
No |
|
LTV |
75% |
55%* |
45% |
25%* |
|
Downpayment for Condo Property Loan |
$250,000 |
$450,000 |
$550,000 |
$750,000 |
|
Min Cash Downpayment % |
N.A. |
N.A. |
N.A. |
N.A. |
|
Total Upfront Cost |
$574,600 |
$774,600 |
$874,600 |
$1,074,600 |
*Take the lower LTV limit only if the loan tenure exceeds 30 years (25 years for HDB flats), or the loan period extends beyond the borrower’s age of 65.
As foreigners do not pay CPF, they do not have the option of using OA savings to pay for their condo downpayment. This means the downpayment has to be paid for fully in cash.
Interest rates are set to rise in 2022, so act now! Secure record-low mortgage rates while you still can. Compare the best mortgage rates on PropertyGuru Finance, or contact us for expert, honest advice and recommendations:
Buying Non-landed Private Property in Singapore
Thinking of buying a condo? Aside from figuring out which property loan to take and budgeting for your new home, you’ll need to decide if you want to go for a resale or new launch condo.
Start by browsing condos for sale on PropertyGuru or read our guides for more helpful information:
- 7 Affordable City Fringe (RCR) Condos Under 1.2 Million
- 29 TOP Condos in 2022 for Those Who Need to Move In Urgently
- 17 Cheapest Freehold Condos in Singapore Under 1 Million (2022)
- 6 Budget-Friendly OCR Condos Under 1 Million
- Guide to Buying Resale Condo in Singapore: The Full Checklist
Making Downpayment for a Condo in Singapore
As you can see from the different total upfront costs, Singapore citizens have the lowest expenditure, including downpayment for a condo, followed by permanent residents. On the other hand, foreigners face the highest cost given the 30% ABSD; compared to the 5% ABSD Singapore PRs have to pay.
Another thing that has a substantial impact on your upfront cost is your LTV, which is mostly based on whether you have an existing property loan, so we strongly advise condo buyers to settle first their existing home loan before buying another property.
Whatever your circumstances, our mortgage specialists are on hand and ready to offer personalised advice and recommendations should you need help with your home loan, refinancing, and more!
Thinking of getting a bank home loan? Compare the best mortgage rates on PropertyGuru Finance, or contact us for more personalised advice and recommendations:
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Other FAQ on Downpayment for a Condo in Singapore
How Much is a Downpayment on a Condo in Singapore
This is dependent on your LTV ratio and the minimum cash downpayment required.
Can I Use CPF to Pay Condo Downpayment?
Yes, you can but only in part. You have to fulfil the minimum cash downpayment which is dependent on your LTV ratio.
Can Single PRs Buy a Condo in Singapore?
Yes, single Singapore PRs can buy condominiums in Singapore.
Can I Buy a Condo If I Own an HDB Flat?
Yes, you can if you are a Singapore citizen.
