In every country, understanding the regulation is important especially for the purchase of big-ticket item like property. In Singapore, in order to curb property pricing, the authority had introduced some measure just for such purposes.
- Buyer Stamp Duty (BSD)
- Seller Stamp Duty (SSD)
- Additional Buyer Stamp Duty (ABSD)
- Total Debt Servicing Ratio (TDSR)
- Mortgage Servicing Ratio (MSR)
- Minimum Occupation Period (MOP)
- Resale levy
- Minimum Sum
- Payment Schedule
- Other property related regulation for Singapore Permanent Resident (SPR) to take note
Buyer Stamp Duty (BSD)
Every property purchase/ Transfer in Singapore is subjected to Buyer Stamp Duty, the amount payable varies according to the purchase price of the property,
- The purchase price of the property above S$1m is 4% less S$15,400
- The purchase price of the property between S$360,001.00 and $1m is 3% less S$5,400.00
- The purchase price of the property between S$180,001.00 to S$360,000.00 is 2% less S$3,600.00
- The purchase price of the property below S$180,000.00 is 1%
*BSD is round off to the nearest dollar. Updated 6 July 2018.
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Seller Stamp Duty (SSD)
On 13 February 2010, since the introduction of SSD, there had been 2 more round of changes for residential property. Since 13 January 2011, the tax structure for residential property with a date of sale and disposal on/after 14 January 2011 is as followed.
- 16% of price or market value, whichever is higher for a 1-year holding period
- 12% of price or market value, whichever is higher for a 2-year holding period
- 8% of price or market value, whichever is higher for a 3-year holding period
- 4% of price or market value, whichever is higher for a 4-year holding period
- No SSD thereafter
From 11 March 2017, for residential property, the tax structure for residential property with a date of sale and disposal on/after 11 March 2017 is as followed.
- 12% of price or market value, whichever is higher for a 1-year holding period
- 8% of price or market value, whichever is higher for a 2-year holding period
- 4% of price or market value, whichever is higher for a 3-year holding period
- No SSD thereafter
On 11 January 2013, industrial property is also subjected to SSD, for the industrial property with a date of sale and disposal on/after 12 January 2013 is as followed.
- 15% of price or market value, whichever is higher for a 1-year holding period
- 10% of price or market value, whichever is higher for a 2-year holding period
- 5% of price or market value, whichever is higher for a 3-year holding period
- No SSD thereafter
- Where land is sold with existing building, the liability for SSD will be based on the zoning of the land in the Master Plan.
- For non-residential property that is re-zoned or the permitted use is changed to residential, the date of acquisition of the property will be the date of rezoning or the change of use.
- SSD payable to be rounded down to the nearest dollar.
- Whether SSD is payable and the rate will depend on:
- The type of property sold or disposed
- The date of the purchase or acquisition
- The date of sale or disposal
- *Date of sale and disposal refers to
- Date of the exercise of Option to Purchase by the buyer
- Date of Sale & Purchase Agreement signed by the buyer
- Date of transfer where (1) and (2) are not available nor applicable
Regards to Exemptions from SSD for Residential Properties under the Stamp Duties Act, Remissions of SSD for Residential Properties under the Remission Rules and Administration, click here.
Additional Buyer Stamp Duty (ABSD)
There had been numerous changes to the structure for ABSD since it was introduced on 8 December 2011.
After the adjustment of new ABSD on 12 December 2013, the latest adjustment for property purchase/ transfer on/after 6 July 2018 will be subject to the following,
|.||1st property||2nd property||3rd property and above|
*Entity means a person who is not an individual, a trustee-manager for a business trust when acting in that capacity and includes an unincorporated association, a trustee for a collective investment scheme when acting in that capacity, and, in a case where the property conveyed, transferred or assigned is to be held as partnership property, the partners of the partnership whether or not any of them is an individual. For developer, there will be additional 5% on top of the 25% ABSD.
**ABSD is base on the purchase price or market value whichever is higher
Additional info for ABSD
- Due to Free Trade Agreement (FTA), Citizen and Permanent Residence from Iceland, Liechtenstein, Norway, Switzerland and Citizen from the United State of America will enjoy the same benefit as Singapore Citizen.
- Reimbursement is applicable to conditions such as – At lease one Singapore Citizen Married to Singapore Citizen/ Singapore Permanent Residence/ Foreigner, and this couple had one existing property with the intention to buy another property (same couple) with the intention to sell the existing one off within 6 months from TOP for a new unit.
- For a married couple with an existing property, with at least one Singapore Citizen Married to Singapore Citizen/ Singapore Permanent Residence/ Foreigner, this couple can purchase with remission on ABSD.
Total Debt Servicing Ratio (TDSR)
The most effective instrument to control the buying of property. This measure is in place to prevent over-borrowing, the main ingredient in forming a property bubble. A good measure to stabilise the property market and give every investor, homeowner more confident in their property.
Effective from 29 June 2013, for property purchase under personal name will have the following effect,
1) For an employee receiving a monthly fixed salary will have a cut of 40% of their income.
2) For self-employed, most part of income is from the commission, full commission base will have a cut of 30% followed by another 40%
example: Borrower’s income is S$10,000.00 without any expenses.
Monthly instalment for the property should not exceed S$6,000.00 for fixed income earner, S$4,200.00 for the rest.
Loan amount have to consider borrower’s age, expenses and income etc
The item that can use to consider as Income
- Fixed deposit
- Rental income
The item that can use to consider as expenses
- Credit card (refers to cards that are used for the transaction)
- Instalment for car
- Instalment for property
- credit card instalment etc
Please refer to your local banker or click here for more information on ABSD.
Loan to Value limit (LTV)
Individual borrower (Private Residential Property), updates on 6 July 2018
|Borrower without existing mortgage loan, taking up to 30 years mortgage loan or up till 65 years of age for new property||max. 75% LTV limit|
|Borrower without existing mortgage loan, taking more than 30 years mortgage loan or exceeding 65 years of age for new property||max. 55% LTV limit|
|The borrower with one existing mortgage loan, taking up to 30 years mortgage loan or up till 65 years of age for new property||max. 45% LTV limit|
|The borrower with one existing mortgage loan, taking more than 30 years mortgage loan or exceeding 65 years of age for new property||max. 25% LTV limit|
|The borrower with more than one existing mortgage loan, taking up to 30 years mortgage loan or up till 65 years of age for new property||max. 35% LTV limit|
|The borrower with more than one existing mortgage loan, taking more than 30 years mortgage loan or exceeding 65 years of age for new property||max. 15% LTV limit|
*The new MAS rules impose an absolute limit of 35 years on the tenure of all loans for residential property.
**HDB is capped at max 25 years loan tenure.
Individual borrower (HDB)
For Non-Individual borrower (Private Residential Property)
Max. 20% LTV limit
Please refer to your local banker or click here for more information on ABSD.
Mortgage Servicing Ratio (MSR)
With effect from 12 January 2013, authority introduce MSR which work quite similar to TDSR. The only differences is MSR only affect borrower for Executive Condo (EC) and public housing.
Instead of 40% cut, MSR is 65% cut.
Please refer to your local banker or click here for more information on MSR.
Note: Max loan tenure for public housing is reduced to 25 years from 30 years.
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Minimum Occupation Period (MOP)
For the owner of public housing and EC, they must meet the 5 years MOP before selling or renting out the whole unit without special approval from the Housing Development Board (HDB).
The Minimum Occupation Period (MOP) is calculated from the date the sellers collect the keys to the flat. It excludes any period where they do not occupy the flat, such as when the whole flat is rented out or when there has been an infringement of the flat lease.
Can Request for Confirmation of Eligibility on your MOP at here.
- For 1 bedroom flat will not have MOP
- For 2 room flat and bigger purchase after 30 Aug 2010 without a grant or CPF loan is 5 years.
- For 2 room flat and bigger purchase between 5 March 2010 and 29 Aug 2010 without a grant or CPF loan is 3 years.
Not applicable to private property owner etc, only affect existing owner whom already enjoy a subsidised flat, wanting to purchase the following property will be subjected to resale levy,
- 1 room flat and bigger buys directly from HDB.
- 1 room flat and bigger buys from a resale market with CPF grant.
- Executive Condo buy directly from the developer (applies to land sale launch after/on 10 December 2013)
Buying the following property will not be subject to resale levy even after enjoying one subsidised flat;
- Studio apartment.
- 1 room flat and bigger bought from resale market without CPF grant.
- Executive Condo bought directly from the developer (applies to land sale launch before 9 December 2013)
- Private property
- Industrial and Commercial property
Resale levy rates for sellers of flats previously bought with grant and who submit their resale applications on or after 3 March 2006
|First Subsidised Flat Type||Amount of Resale Levy Payable under the Revised Policy (From 3 Mar 2006*)|
These resale levy rates apply only to sellers of flats previously bought with singles grant and who submit their resale applications on or after 15 Sep 2004
Previous resale levy is based on resale price or 90% of market valuation, whichever is higher:
|Flat Type||Resale Levy payable by family grant recipient||+Resale Levy payable by singles/half grant recipient|
|2-room||*10% / 15%||*5% / 7.5%|
|5-room & Executive||25%||12.5%|
|*2-room flat sellers pay a lower rate, that is 10% or 5%, only if they buy a bigger flat direct from HDB.|
Note: For a person who took CPF housing grant for single, will need to pay only half the amount of the levy imposed when they subsequently form a family and buy or take over the ownership of a second subsidised flat.
Mode of payment for Levy
If you are subjected to resale levy, you can:
- Pay the resale levy immediately at the point of resale, i.e. when selling your subsidised flat or
- Defer the payment until you buy another flat from HDB. If you come under the previous resale levy policy and opt for this, an interest at the prevailing rate of 5% per annum will be charged.
You can pay the Resale Levy with either or combine with the following:
- with your sale proceeds or
HDB’s mortgage financing is not extended for the payment of the resale levy
|| You can choose to pay resale levy at the point of:
Every citizen will need to keep a minimum sum in their CPF’s ordinary and/or special account. Those who had existing property only need to maintain half of the amount required amount when purchasing their next property using CPF.
Since the introduction of the minimum sum on 1st July 2003, the amount had since raised from $80,000 to $161,000 starting 1st July 2015. For now, the buyer who intends to utilise their CPF for their 2nd property and had not met below criteria will need to set aside $83,000 but as years go by, the sum will increase.
|Year||Basic Retirement Sum (BRS)||Full Retirement Sum (FRS)|
The following group of the buyer (base on an individual) need not set aside minimum sum.
- 1st-time buyer
- The buyer with no property on hand
- The buyer with existing property that is not paid with CPF at any point of time
- The buyer who had utilised CPF for their existing property but not intending to use CPF to pay for their next property
- The buyer with existing property that had utilised CPF, declared to sell off within 6 months from collecting their new property (subject to approval)
In short, as long as utilising CPF for 2nd property (with existing property paid with CPF) onwards will need to set aside minimum sum.
Other property related regulation for Singapore Permanent Resident (SPR) to take note
- Since 12 Jan 2013, SPR is not allowed to sub-let their entire HDB flat but not restricted to individual room/s
- SPR is not eligible for Build to Order (BTO) flat from HDB
- For HDB re-sale, all non-Malaysian Permanent Residents will have to abide by a PR quota. All neighbourhoods have a maximum of 5% non-Malaysian PRs living in its public housing and in turn, every block is to have an upper bound limit of 8% PRs.
- The sibling who is SPR will no longer allow applying for new HDB flat together
- SPR couple will need to hold on to their SPR status for at least 3 full years before they can purchase a resale HDB flat together. All existing foreign private property and/or local property owned by this couple will need to be disposed of within 6 months after the purchase.
- No restriction for the purchase of private property in Singapore. However, for those with existing HDB flat will need to be disposed of their existing HDB flat within 6 months of acquiring the new private property.