Have you gotten your BTO before the SEPT Launch?
Are you going to exercise your option for your resale flat?

What are the differences if you exercise your option after 24 AUG 15?
What are the differences if you decide to forfeit the current BTO, and await the SEPT Launch?

Let us try to understand what are the significant changes to the Grants available after the National Day Rally 15′ and see how it will affect you and I!

FIRST of all,

you have to understand the types of grants you are eligible for when you buy a
RESALE FLAT and when you buy a BTO FLAT.








AFTER knowing this, then it is applicable to know what are the NEW UPDATES to the grants.


Screen Shot 2015-08-26 at 2.14.39 pm



Before 24 Aug 15
a first-timer family is eligible for Housing Grant for Family at $30k assuming SC/SC Household + additional $10k if living nearing parents.

After 24 Aug 15,
the additional $10k is removed,
and added with the new PROXIMITY HOUSING GRANT (click here for more info), where a family is eligible is eligible for up to $20k worth of subsidies if they have never received PHG Grants before.


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FOR EC BUYERS, income ceiling has also increased from $12k-$14k!


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From July 13 to May 15, the SHG Grants are capped at 20k.
However, from SEPT launches onwards, SHG Grants are increased to 40k.

With the Additional Housing Grants (unchanged), you are able to receive up to 80k worth of grants, from the SEPT Launches onwards, assuming you’re eligible.


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Essential questions to ask yourself:

1. How can I benefit from the PHG, if I am a second-timer and I can apply again?
Does it mean that I can shift again?

2. Should I forfeit my current BTO and apply for during the SEPT Launch so I can apply for more SHG Grants?
Will it mean that more people are doing that and my chances are further diminished because a further 20k grant?
Furthermore, I will have less chances during my next ballot.

3. With an increase in Income Ceiling, I am eligible for more grants,
is it a good time to buy a property since property prices are lower?

4. With these grants, is a BTO or Resale Flat better now?




5 Must Know Websites For Every Property Purchaser

I had this conversation with one of my NS mates a few days ago:

“Wah Ken, thanks for the write up last week. 

Until I read your post, I didn’t know we had so many more things we need to pay for man!  (Click here)
Jialat leh, I think we (people in our age group) really have imperfect information sia.
We do not know where to find the relevant and important information for our property purchase.”

“What is relevant and important to you then?”

“Things like past transactions so we can compare? Things like what are the available properties on the market?

I interrupted.
“Things like Stamp Duties payable? Things like what will be the future development of your surroundings?


“How about you join me as an agent la? Then you will know everything mah! Hahaha, just kidding la. Ok, i know what to write this coming week already!”

Do you have similar worries as well?
That you are not well informed and have imperfect information?

In today’s A Little Property Class, we will touch on the 5 Must Know Websites For Every Property Purchaser!
It is presented in no particular order. These sites are of my humble opinion.

Of course there are definitely more sites to these, but these are 5 which I personally feel is a Must-Know.
If you have any other sites which you feel are important and should be shared with everyone, please kindly leave a comment or contact me to let me know! 🙂

Let’s Go!

1. Property Guru

“Where to are the available Properties for sale and rent on the market?”


Established in 2007, was one of the first property portal in the market. Within a short space of 3 years, it became the #1 portal in Singapore in 2010. It currently has over 3.5 million visitors viewing more than 52 million page views monthly. It has the most comprehensive property listings, with a 6-month aggregate of more than 230,000.

Property Guru (and also Commercial Guru) is highest used property site by Real Estate Salespersons to post their listings (both residential and commercial) for sale and rent. They boast a total of more than 900,000 property listings regionally.

Screen Shot 2015-05-25 at 8.35.15 pm

Its effective search engine allows users to refine their search to meet their specific needs.

Specific Needs include:
-Type of property
-Location/District of Location
-Price/Budget Range
-Floor Size
-Tenure of land
and many more

Screen Shot 2015-05-25 at 8.46.39 pm
An screenshot of the search engine

Property Guru has evolved over the years. They have developed a mobile app that is more handy and ready to serve its users. You can download Property Guru app from your App Store and Google Play.

2. HDB Website

“What are the transacted prices?”
“What are the available Grants?”
“After I sell my house, what are my sale proceeds?”
“Am I eligible to buy/sell?”
“What are the things to do if I want to sell my house without an agent?”

These questions can be easily answered in the HDB Website.
You just have to play around with the page.
The HDB website can also help you check your Resale Appointment, ethnic quota etc.

This is one particular Function which I find very useful.


Screen Shot 2015-05-25 at 9.23.50 pm

It allows you to find out about the past transacted prices/past rental prices of your flat and neighbouring prices.
It also gives you important information such as:
– Lease Details
– Flat types & number of units per block
– Ethnic Group Eligibility
– Non-Citizen Quota for Subletting
– Subletting Rental Rates
– HDB upgrading program
– Distance Enquiry for CPF Housing Grants
and many more..

Screen Shot 2015-05-25 at 9.08.38 pmScreen Shot 2015-05-25 at 9.08.24 pm

Screenshots of useful information you can derive using Centralised Map Services.

3. URA Website (Private Property Price Index)

“How about Private Property transacted prices?”
“What will the government plans for my surrounding neighbourhood?

Similar to the HDB website, the URA website allows you to get hold of private housing transacted prices.
URA will publish these information on a quarterly basis.

It also publishes articles that talk about the recent market conditions.
Similarly, you can search the Master Plan and find out what the government is planning to do with the land that is near your house.
Screen Shot 2015-05-26 at 11.52.40 pm
An example of the transacted prices of a Condominium I am currently Marketing.

Screen Shot 2015-05-26 at 11.55.44 pm
A screenshot of the Masterplan 2014.
Find out more about it here.

4. SRX

“What is the agar-agar valuation of my property?”

Screen Shot 2015-05-26 at 11.58.24 pm

SRX is an information exchange formed by the leading real estate agencies in Singapore.
Its purpose is to disseminate market pricing information and facilitate property transactions.

Screen Shot 2015-05-27 at 12.01.52 am
Screenshot of leading Real Estate Companies In Singapore

Why is SRX useful?

SRX provides X Value – which is the agar valuation you can get without a valuator.

X-Value is a computer-generated market estimate of nearly every property unit in Singapore. It is the result of a 12-month project co-funded by the Singapore Government through the Infocomm Development Authority of Singapore (IDA). The project involved leading estate agencies, academic institutions, government agencies, peer review by certified appraisers, and StreetSine Technology Group, the technology provider for this project.

For more information, please read X-Value FAQ

Screen Shot 2015-05-27 at 12.18.06 am
A Screenshot of a randomly selected 5 room flat in Singapore

You are able to use this service effectively for the pricing of your unit for sale.
At the same time, it allows you to better decide whether it is a good time to sell your property.
Of course there will be a difference from the actual valuation done, but this serves as a pretty good gauge.

SRX is also a property portal that showcase exclusive listings for Sale and Rent, but it is significantly less than that of Property Guru, as Property Guru also feature open listings.

5. INLIS (Integrated Land Information Service)

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How do I know whether the seller/landlord is the rightful and legal owner of the property I am buying/leasing?”

INLIS is a government website run by the Singapore Land Authority (SLA)

It allows you to purchase important information such as land title information, and many other services.
Prices are listed in the website.

It is especially important to ensure that you are buying/leasing from the rightful owner of the property because they have been cases where the sellers/landlords are bogus, fraudulent and cheated many victims of their hard earned money!

Indeed, you can argue that you can check income statements, official letters mailed to the mailbox, etc.
However, these are documents that may not be so easily acceptable as they are personal.
There can be so many scenarios in which things can happen, please be careful and do your due diligence!

This is especially important to friends who decide to go directly to a seller/landlord who happen to not engage an agent as well. You are thus responsible to ensure that you have confirmed your sellers/landlords are the owners so as not to infringe the law!

I hope that this article have further helped you in finding the crucial information that you need before you purchase your first property!

Do you have websites that I have missed out and you think is important to share with everyone?
Kindly comment, subscribe and like if my posts have benefited you!

Thank you my faithful readers, for being so kind and sending me words of encouragement and saying thank you to me. I hope that my articles will continue to help you!

Ken Seah

You may also be interested in:
Little Property Education!

2. Different Types Of Flooring
3. 5 Money Traps Couples Fall Into When Buying Their First Property
4. What To Bring For First Appointment?
5. Contra Facility
6. Financing Using Hdb Or Bank Loan
7. HDB Housing Grants


Over the past week, some readers have texted me and asked me about the extra costs (hidden costs in their terms) to be paid when you purchase a HDB house. In today’s A Little Property Education, we will cover on The Costs Involved In Purchasing A Flat.

On top of the purchase price of the house, there are certain other costs involved. These are not exactly hidden costs, but should always be in your consideration when you purchase any property, be it HDB or a Private House.

This entry will be written in such a way that you have finally found your dream home and decided to purchase the property. We will be moving along a timeline in which the events are happening in order.

For simplicity sake, your dream home is a Resale 4 room-flat priced at $400,000.
This is going to be your first home and you will be taking HDB Loan, and will not be taking any Housing Grants.
(All values are approximate and may vary. Costs mentioned here are applicable for this particular case study only. It does not apply for any other property transaction)

Let’s Go!



After viewing some properties on the market, you and your partner have finally found your dream home and decide to purchase a certain property.

You will be required to pay the sellers an amount of $1 to a maximum of $1000 in exchange for the Option to Purchase (OTP), and you be will entitled to an Option Period before exercising the Option.
(Option Period: a maximum of 21 calendar days, including Saturdays and Sundays and it expires at 4pm of the 21st calendar day)

Option Fee: $1000 (assume you paid the maximum amount)


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After the sellers have granted you the Option To Purchase (OTP),  you are required to submit a Valuation Request by the next working day. All valuation reports must be submitted online.

You can submit the request via  e-Resale (Online Submission of Resale Application and Valuation Request) only after the sellers have granted you an Option to Purchase. The request MUST be submitted by the next working day.

Valuation Costs: $199.25 (Your dream home is a 4 room flat, remember?)
TOTAL “OTHER” COSTS INVOLVED= $1000+$199.25= $1199.25

Assume that the Valuation Report comes out at $380,000 after a few days.

3. Exercise Fee

Upon careful consideration, also knowing that you need to pay Cash Over Valuation (COV), you and your partner still decide to exercise the Option before the Option Expiry.
Remember that you must already have submitted your Buyer’s Resale Checklist at this Point!

After exercising the Option, you are required to pay a deposit to the sellers. This deposit (exercise fee), including the Option Fee, cannot exceed $5000.

Exercise Fee: $4000
TOTAL “OTHER” COSTS INVOLVED= $1199.25+$4000= $5199.25

4. Admin Fees

Screen Shot 2015-05-19 at 12.06.43 am

After you have exercised the Option, you will move on to book your First Appointment.
This is an Admin Fee to be paid to HDB. You will submit this booking online.

Admin Fee: $80 (4 room)
TOTAL “OTHER” COSTS INVOLVED= $5199.25+$80= $5279.25

5. Admin Fees For Extension Of Stay

The seller of your dream home mentioned that they need about 1 month of extension stay as they are still in the midst of finding their new dream home.

Being kind hearted people, you have agreed to allow the sellers the extension.

HDB will then charge you an administrative fee of $20.
This fee, however, is usually paid by the seller, as they are the party who needs the extension.

TOTAL “OTHER” COSTS INVOLVED= $5199.25+$80= $5279.25

6. Conveyancing Fees


After your First Appointment with the HDB Officer, you are required to get your conveyancing done. You have taken a HDB Loan, and decided to engage HDB to do your conveyancing for you.

Conveyancing Fees: Approx $500
TOTAL “OTHER” COSTS INVOLVED= $5279.25+$500= $5779.25

Note: You are able to get your conveyancing completed by HDB/lawyer if you are using a HDB Loan.
If you are using Bank Loan, you have to seek a lawyer for conveyancing purposes.
A lawyer would charge from a range of approximately $1800-$4000 for conveyancing depending on which law firm you engage.

To get a rough estimate of your conveyancing fee, assuming you are getting HDB to act for you, you can click HERE.

7. Cash Over Valuation

You will be required to pay $20,000 worth of cash over Valuation shortly. (within 10 days of your First Appointment)

This is because:
Your purchase Price : $400,000
Valuation Report: $380,000

Note: COV varies differently. It is possible that a property is bought without any COV, thus, there is no need to pay COV upfront.

COV: $20,000
TOTAL “OTHER” COSTS INVOLVED= $5779.25+$20,000 = $25779.25

8. Stamp Duty

Screen Shot 2015-05-18 at 10.39.37 pm

Stamp Duties are to be paid the government upon purchase of a property.
For the Different Stamp Duties to be paid, please click here.

For your scenario, as it is your first house, you are required to pay only the Buyer Stamp Duty.

Screen Shot 2015-05-19 at 12.45.39 am
Using this table as a guide, your Buyer Stamp Duty applicable works out to be: $6600

Buyer Stamp Duty: $6600
TOTAL “OTHER” COSTS INVOLVED= $25779.25+$6600 = $32379.25

Note: Buyer Stamp Duties for HDB can be paid by CPF. For better clarifications, contact IRAS for more details.

9. Insurance


As you are taking a loan from HDB, you must buy a Fire Insurance from the Insurance Agent Appointed by the HDB.
You must produce a valid Certificate of Insurance issued by the HDB’s appointed insurer on the date you complete the purchase of the resale flat.

The appointed insurer is Etiqa Insurance Pte Ltd (ETIQA). For more details on the HDB Fire Insurance, you may:

1. Call the ETIQA’s enquiry line on 6331 9253 or
2. Visit ETIQA’s website

TOTAL “OTHER” COSTS INVOLVED= $25779.25+$6600 = $32379.25

10. Agent’s Commission

Last but not least, as your friendly housing agent, I have been working tirelessly in assisting you to find your dream home, to assist you in the negotiation as well as to ensure that all documents and necessary paperwork are completed on time.

You have agreed to pay me 1% as commission.

Note: Commission varies and it is agreed by the agent and the buyers.

Commission: $4000
TOTAL “OTHER” COSTS INVOLVED= $32379.25+$4000 = $36379.25


Did the sum of money scare you?

In this small case study, we can see that the other costs can add up to quite a significant amount. To some, this amount actually mean a lot, and therefore, it is important to understand all these amounts before you commit into buying a property!
I hope that this case study gives you a better understanding and will help you make a more informed and better choice!

If you are still confused are still have other things that is bothering you, please feel free to contact me at 9277 4372.
Have a great week ahead!!!
Please comment, like and subscribe! 🙂

Best Regards,
Ken Seah

You may also be interested in:
Little Property Education!
1. Different Types Of Flooring
2. 5 Money Traps Couples Fall Into When Buying Their First Property
3. What To Bring For First Appointment?
4. Contra Facility
5. Financing Using Hdb Or Bank Loan
6. HDB Housing Grants

Different Types Of Flooring

Have you ever wondered how to identify the different types of flooring in your house?
I hope this will help you out!

In today’s A Little Property Education, we will cover something closely associated to your property, or the property you are going to purchase, the types of flooring. Well of course I am no interior designer, but these are generally the types of flooring that are most commonly found/used!
Screen Shot 2015-05-11 at 7.19.23 pm

Hopefully you are able to determine the different types of flooring when you go and view a house in the future! (:

Cheers! Have a magnificent week ahead!

You may also be interested in:
Little Property Education!
1. 5 Money Traps Couples Fall Into When Buying Their First Property
2. What To Bring For First Appointment?
3. Contra Facility
4. Financing Using Hdb Or Bank Loan
5. HDB Housing Grants

5 Money Traps Couples Fall Into When Buying Their First Property

What are the common errors you may face when you purchase your first property?
In our competitive country and workforce, money does not come by easy. Therefore, how you spend your money on your first property is crucial — it has a huge impact for many years, for some, this decision will affect them for a lifetime.

In today’s Little Property Education, I found this article posted on Money Smart, pretty relevant and useful.
I hope you feel the same way too! If you have any housing needs, please feel free to contact me at 92774372!

Here we go!

Sharon Ang
04 May 2015

The unspoken proposal in Singapore has long been balloting for a new HDB flat, especially in the past years where successfully being allocated one is akin to striking the lottery. An indeed uniquely Singaporean path to ‘happily ever after’.

Or is it?

As most couples considering a life together are also first time property buyers and have their full-time jobs and other major things like wedding planning to juggle all at once, herein lies the potential to make some major booboos which can potentially undermine your finances in marriage and even test the mettle of your love.

Property decisions are long-term, and what you decide at the very start can lock you in for a very long time.

It is therefore prudent to be aware of the traps that well-intentioned couples fall into at this significant juncture of their lives.

Here are 5 such traps and what you should be aware of:

1. Overextending your finances, making your love nest your prison


Sure, starting a new life together as a couple is exciting, it speaks of new beginnings, new adventures, and perhaps even a new family down the road. With the best interests in mind, it is tempting to splash out on a bigger property than you can comfortably afford, assuming that:

– Your pay can only go up, since you are young and talented.

– Low interest rates will go on forever.

– You can sell your property for a huge profit later on.

Thanks to the government’s slew of cooling measures, among which are capping MSR at 30 per cent for HDB flats and TDSR at 60 per cent for all properties, you should find yourself unable to seriously overextend yourself even if you are tempted to.

Other factors you should consider, and be aware of in making the decision of how much to spend on your first property are:

– Will one of you stay at home to look after the children when they come along? This may potentially half your income, and no, your mortgage repayments will not be halved.

– Interest rates are at rock bottom currently but they will most definitely go up, it is just a matter of when.

– Property prices are not at fire sale prices, so forget about cashing in on huge profits and retiring to Timbuktu.

Make sure you are comfortable with the monthly repayments throughout the tenor of your loan, and think about when you’d want to retire.

This way, your home will always be the haven and sanctuary you envisioned it to be. And not the silent reason why you’re always stressed or staying late at work while your maid enjoys your property.

You also do not want to find yourself unable to leave a job which you hate because of your mortgage.

2. De-coupling home ownership even while you seal your couple-hood


What with the ABSD for 2nd properties and above, it is enticing to attempt to beat the system by buying private matrimonial properties in single names.

After all, your spouse can buy a 2nd property in future without having to pay ABSD.

Although you may feel empowered by this choice, especially if you are able to afford the property with your own income, do not ignore the perils of such a decision.

Do consider the following:

Is it wise to buy a matrimonial property in a single name? Will your spouse be willing to contribute financially when the property is not in his/her name? Will that be fair? If not, will you be expecting your spouse to pay for everything else? Like the renovations, daily necessities, a car etc?

Even if you do decide to proceed with this decision, it will do you good to discuss these expectations before you do, so that they do not become stumbling blocks to the harmony of your marriage later on. Decisions made with good intentions can become thorny issues later in the humdrum of daily life.

The ABSD will not last forever, but your property may (especially if it is freehold). One must remember they are one of a set of cooling measures to rein in property prices and keep them affordable for first-time property buyers.

However, if property prices were to start tanking significantly, it is likely that the current measures, including ABSD, will be relaxed layer by layer, like peeling an onion. After all, it is to no one’s benefit for the single largest asset owned by most of us to depreciate.

Thankfully, for HDB purchases, there is no such de-coupling option, and even the rules for how much to be returned to each spouse’s CPF upon its sale is clear-cut.

These protect the individual and it would be prudent to consider them even when buying private properties.

3. Taking a mortgage only considering the interest rates for the first few years


Although interest rates still remain low at mid-1 per cent+ for mortgages, do not be swayed by mortgage bankers who sell you mortgages based on the interest rates for only the initial years and then count on refinancing later on.

Refinancing later on comes with many risks, including the interest rate environment then, your employment situation then, the state of the economy and property market then (affecting the valuation of your homes) and government/banking policies then (which affect whether legal subsidies can be given by banks).

There are simply too many unpredictable factors involved, and one is better off locking in the best possible housing loan package in totality right from the very start.

Even if the initial rates are 0.1 per cent higher than the other bank’s, what you’d want to ensure is that the rates after the initial years are competitive, in case you are unable to refinance to your advantage when the lock-in period is over.

After all, one does not want to end up in a penny-wise, pound-foolish situation. This is especially so for properties under development, for which the monthly repayments and hence potential savings in the first few years are insignificant.

4. Buying a shoe-box unit for a palatable total sum but an exorbitant psf price

Shoebox 1

With soaring property prices in recent years, it has become an increasing trend for developers to launch tiny units as a way to move sales and preserve their profits.

It may be tempting to buy a 500 or 600+ sq ft condominium unit at less than S$1million, especially for professionals or HDB dwellers looking to buy an investment unit.

Do keep in mind the thousands of units coming into the market over the next few years, which means that it may not be easy to rent out or sell your unit at a profitable price. This while it locks up your ‘quota’ for property ownership with ABSD and punitive financing quantums for subsequent property purchases.

5. Buying an old charming property expecting an enbloc sale (for private properties) or SERs (for HDB)


Gone are the heady days of enbloc sales and overnight millionaires. Buying a property hoping for an enbloc or SERs is as good as gambling. You would probably not want to live with such an uncertainty for the years and even decades ahead.

An old property on a 99-year lease is simply what it is, an old property with a shorter life span. One should always assume that the value of the property will be zero at the end of the lease and ask ourselves if we are comfortable paying the amount for the remaining lease.

Buying a property takes an afternoon or less, but can either be the source of joy or worry and stress for many years to come.

If you are contemplating marriage and buying your first property in the foreseeable future, it is good to use the above as a checklist to have the necessary discussions with your significant other before making the largest purchase of your life.

I hope this article has given you a clearer picture and a better insight on what you should look out for when you purchase your first property. Please comment, follow, and subscribe for more information of the Singapore property market.

Have a great week ahead!
Ken Seah
9277 4372

You may also be interested in:
Little Property Education!
1. What To Bring For First Appointment?
2. Contra Facility
3. Financing Using Hdb Or Bank Loan
4. HDB Housing Grants

What Do I Need To Bring For First Appointment?

A friend whatsapped me and requested me to write about what are the documents needed for First Appointment.

Therefore, in today’s A Little Property Education, we will cover on the list of items you need to bring for your First Appointment.

For all readers who do not know what is the First Appointment.

What is the purpose of First Appointment?

Screen Shot 2015-04-27 at 10.16.51 pm

List of Documents to Bring For First Appointment

Documents buyer needs to bring for First Appointment

Buyer will need to bring:

  • Original Identity Card of buyer(s) or Passport in absence of Identity card, along with 1 photocopy
  • HDB Loan Eligibility Letter/Letter of Offer from Bank
  • Income documents for assessment of income ceiling if taking the CPF Housing Grant
  • Income documents for assessment of income ceiling if taking the Additional CPF Housing Grant (AHG)
  • Latest Pay slips if taking an HDB loan
  • Power of Attorney, if applicable
  • Lasting Power of Attorney (LPA), if applicable
  • Marriage Certificate, if applicable
  • Child’s Birth Certificate, if applicable
  • Original Buyer’s Resale Checklist if you have used the hardcopy Resale Checklist and have submitted a scanned copy of it together with your resale application on or before 30 November 2013.

Additional documents needed, if buyer is a bankrupt

If the buyer is buying any of the following flat types, he/she needs a Letter of Consent from Official Assignee to consent to the purchase.

  • Executive Flat
  • Multi-Generation Flat
  • HUDC flat

Additional documents needed, if the buyer has inherited an interest in an HDB flat*

  • A Petition for Letter of Administration with the Estate Schedule

FOR YOUR EASE: I’ve made a flow chart for you to save into your phones to use as a checklist!

Screen Shot 2015-04-27 at 10.57.40 pm

I hope you have found this entry and the flowcharts useful! Please remember to share, like and subscribe!
Also, comment on what you would like to be shared next Monday!

You may also be interested in the other posts of A Little Property Education!
1. Contra Facility 
2. Financing Using Hdb Or Bank Loan
3. HDB Housing Grants

Have a victorious week ahead!
Ken Seah

Contra Facility


In today’s edition of A Little Property Education, we will be covering about the Contra Facility. If you missed last week’s sharing you can click here. Last week, we shared about financing your HDB house, whether to use HDB Loan or Bank Loan.

Alright, let’s go!

Screen Shot 2015-04-20 at 11.56.06 pm

The Contra Facility was introduced to lighten the financial burden of flat owners who are eligible for a housing loan from HDB by reducing the cash outlay needed. Hence, if you own a flat and are in the process of buying a new flat, the Contra Facility will help you to reduce the amount of mortgage loan required and the subsequent monthly repayments. In addition, the facility enables you to take possession of and renovate your new flat while selling your existing flat.

To qualify for the Contra Facility, you have to:
i) book a new flat and are invited to take possession of it, and
ii) submit an application to sell your flat.

Other Conditions
You must ensure that:

i) you are eligible for HDB’s housing loan.
(therefore, if you are using bank loan, CONTRA is no longer an option)

ii) the funds that you have and are eligible for are enough to cover the full purchase price of the new flats.
These are:
a) your CPF Ordinary Account balance,
b) both cash and CPF proceeds from the resale of your current flat, and
c) the maximum loan you can be eligible for after you are credit assessed

iii) if the above funds are not enough, you must be able to top up the shortfall within a given period before the request for the contra facility can be approved.

Application Procedures
You must submit your request for the Contra Facility together with your application for resale of your current flat. You can download a copy of the Request Form for Contra Facility. After you submit your resale application through e-Resale or Estate Agent Toolkit, you have to submit the Request Form for Contra Facility separately by fax, post or over the counter latest by the next day after your electronic submission.

What you need to know before you apply

i) The proceeds from the sale of your current flat cannot be used in the contra arrangement to pay for the downpayment of the new flat.

ii) If the contra arrangement is approved, you will be invited to take possession of the new flat on or before the first resale appointment date.

iii) You can choose to use CPF contra or CPF and Cash contra arrangement for the purchase of the new flat.

iv) You will be allowed to use cash contra arrangement alone only if there is no CPF refund from the sale of your current flat.

v) You will have to use all the balance in your CPF Ordinary Account, as well as the CPF refund from the sale of your current flat before you are given an HDB mortgage loan.

vi) Under the Contra Facility, a temporary mortgage loan may be granted to you before the completion of sale of your current flat.

Temporary Housing Loan
i) At the time you take possession of your new flat, you will be granted a temporary housing loan after fully using up the CPF balance in your Ordinary Account.

ii) You have to redeem the portion of the mortgage loan above the loan amount you are eligible for, using the sale proceeds of your current flat.

iii) Interest will be charged for the additional loan temporarily granted.

iv) You will be considered as taken one concessionary interest rate loan even if you fully redeem the mortgage loan subsequently.

Taking Possession & Renovation
i) After taking possession of your new flat, you may proceed to renovate it while the resale transaction of your current flat is in progress.

ii) At the point of resale completion (estimated to be two months after taking possession of the new flat), the proceeds (CPF refund or cash, or both) will be used to partially redeem the mortgage loan.

Thank you for reading, hope this article helped you in some way or another! Please help me to share and like this article if it was useful to you!

Have a great week ahead!
If you have any further questions, please contact me at 9277 4372, or email me at

References: Information are edited from the HDB website.

Financing Your Purchase? HDB or Bank Loan?


In today’s edition of A Little Property Education, we will be covering about financing your home purchase, using HDB loan/Bank Loan. This is a continuation of last week’s edition of HDB Housing Grants.

By the end of this post, you will have a better understanding on the Eligibility, Which Loan to Apply, Differences in the Loan Tenure and Interests, When to Apply, How to Apply, What to Note. 

If you feel that the post is too long, too much information and too confusing for you, contact me and I will be more than willing to fix an appointment and explain in details clearly to you!

Please feel free to comment on the topic to be discussed on the next edition so you are able to find out more information!

For simplicity sake, today’s discussion will be assuming a purchase of a HDB flat.
For Private Properties, HDB LOAN will not be available, and there is a slight difference for BANK LOAN eligibility.
(Call me for more information)

We will first start with BANK LOAN as it is more straightforward and shorter.


Bank Loans are usually taken by individuals who:
1. Prefer the loan package as bank loans usually have lower interest rates compared to HDB Loans
2. Its their 3rd housing Loan, and therefore are not eligible for anymore Housing Loan.
3. In general, buyers who need financing but are not eligible for HDB LOAN. (eligibility will be covered in the next chapter)

What are the steps involved in getting a Bank Loan?

1. Contact a banker/bankers
2. Submit relevant documents (banker will advise you accordingly)
3. Get the IPA aka In Principal Approval
4. Sign the LO (Letter of Offer) from the respective bank upon comparison

If you need a list of bankers for you to do mortgage loan, be it for HDB or Private Property, you can contact me as I have a list of Bankers that can help you a better package. 

What to note?

All banks that issue the loan must be registered with the Monetary Authority of Singapore.
A list of all the banks registered with the MAS can be found here.

You are required to pay 5% of your purchase price in Cash.

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Next, the HDB LOAN.


HDB provides housing loans at concessionary interest rate to flat buyers, subject to HDB’s credit assessment and prevailing mortgage loan criteria.

Since 1 January 2003, flat buyers who are not eligible for an HDB loan and require financing to buy a flat will have to take a mortgage loan from a bank/ financial institution that is licensed by the Monetary Authority of Singapore.

Flat buyers can apply for an HDB loan if you and your essential occupiers (if any) meet all of the following conditions:

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When To Apply?

What is an HLE letter?

The HLE letter is a financial planning tool.

Knowing the housing loan you can get will allow you to calculate the available amount you have to buy or take over the ownership of a flat.


If you are eligible for a housing loan from HDB, the HLE letter will inform you on:

  • Maximum loan amount that you can get;
  • Maximum monthly instalments to pay;
  • Maximum repayment period;
  • Amount of cash proceeds to be used to pay for the next flat (if applying for second HDB housing loan); and
  • Other terms and conditions.
    The maximum housing loan amount is determined based on your financial situation, up to the loan-to-value limit of the flat you intend to buy.
    Apply for HLE letter now.
How to use the HLE letter to plan my flat budget?

Your flat budget will consist of the housing loan that you can get, the amount of CPF savings that can be used and cash savings

Make use of the  Sales Financial Plan,  Resale Financial Plan,  SERS Financial Plan, and DBSS Financial Plan to estimate your own financial plan and the other costs involved in buying a flat.

When do I need a valid HLE letter?

You are encouraged to have a valid HLE letter and complete your own financial planning before searching for a flat.

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The approved HLE letter will be valid for 6 months from the date of issue. Thereafter, if another HLE letter is needed, please submit a new HLE application online and provide the latest information for re-assessment of loan eligibility.

For those buying uncompleted flats, your family’s financial position will be reviewed nearer the completion of the flat for loan disbursement. The actual loan amount that can be granted will depend on the age, income and financial situation then.

The loan offer will be reviewed if:

  • any given information is untrue or incorrect;
  • there are any changes in your household income, family nucleus or other circumstances which may affect your eligibility for a loan; or
  • you and/or the occupiers who form the family nucleus do not comply with any of the terms and conditions

How To Apply?

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HDB Loan Eligibility (HLE) Letter

If you wish to get an HDB loan, you will need to first obtain an HDB Loan Eligibility (HLE) letter.

Credit Assessment

The amount of housing loan that can be granted will depend on the buyers’ age and monthly income.  If you are buying an uncompleted flat from HDB, there is a loan review for HDB loan applicants nearer flat completion. You will be notified when it is time for the review.

Maximum Loan Quantum

The maximum loan amount that may be granted depends on:-
(a) maximum repayment period;
The maximum loan repayment period is 65 years minus the buyer’s age or 25 years, whichever is shorter.

(b) applicable interest rate;
Computation of the maximum loan will be based on the prevailing interest rate which may be revised from time to time. The interest on the HDB loan will be computed on a monthly rest basis or such other basis as the HDB may decide.

(c) monthly instalments; and
This is capped at 30% of the gross monthly income.

(d) loan ceiling.
The loan that can be granted for the purchase of an HDB flat is subject to:

Sales Type Loan Ceiling*
Direct purchase flats 90% of the purchase price
Resale flats 90% of the resale price or 90% of the market value, whichever is lower

*If you have selected your flat before 19 Jul 2005, your loan ceiling is capped at 80%.

Gross Monthly Income

Credit assessment will be conducted based on the buyers’ age and income to compute the amount of housing loan you can obtain. Please click on the Income Guidelines for Credit Assessment to check the types of income which will be considered in HDB’s credit assessment.

Right-sizing the quantum for the second concessionary HDB loan

To further encourage financial prudence, HDB will reduce the quantum of the second concessionary loan by the full CPF proceeds and part of the cash proceeds from the disposal of the existing or immediate past HDB flats.HDB reserves the right to determine the amount of proceeds to be deducted, depending on the existing / immediate past flat’s manner of holding or the provisions of any court order relating to the disposal of the flat (where applicable). HDB will determine the proceeds to be deducted, taking into account the provisions of the court order, without reference to the manner of holding of the existing / immediate past flats. Flat buyers can keep the greater of $25,000 or half of the cash proceeds (including the cash deposit received), HDB will take into account the remaining part of cash proceeds when determining the quantum of the second loan to be granted.

Manner of disposal of existing or immediate past HDB flat includes by way of sale, transfer, surrender or compulsory acquisition.

The cut-off dates for different types of flat transactions whereby the amount of the second HDB concessionary interest rate loan will be reduced by the CPF and cash proceeds from the disposal of existing flat / immediate past flat sold are summarised in Table 1:

Table 1: Cut-Off dates for utilisation of sales proceeds before granting second HDB concessionary interest rate loan

Transaction Types
Cut-Off Date
Purchase of New Flats or DBSS Flats
Date of booking of flat and HLE Application received by HDB on or after 5 Mar 2010
Purchase of Resale HDB Flats
Date of HLE Application on or after 5 Mar 2010
Purchase of Replacement Flats Under SERS
Date of HLE Application by SERS flat owners for new SERS sites announced on or after 5 Mar 2010

For buyers and essential occupiers who have taken one HDB concessionary interest rate loan and buy the next HDB flat after disposing the existing one

For those who buy the next flat after disposing the existing one, they will have to use part of cash proceeds from the disposal of the immediate past HDB flat and all of the CPF balance to finance the purchase of the next flat.

For buyers and essential occupiers who have taken one HDB concessionary interest rate loan and buy the next HDB flat before disposing the existing one

Those who buy their next flat before disposing the existing one, HDB will first grant them a loan at commercial interest rates (which are pegged to the 3-month average non-promotional interest rate for HDB flats offered by the 3 local banks) after they draw down their CPF balance. After the disposal of their existing flat, they will have to redeem this loan with the full CPF refund from disposal of the existing flat and part of the cash proceeds. Upon redemption, the loan will be converted to a concessionary rate loan.

Use of All CPF Savings

Subject to limits for properties with less than 60 years of remaining lease, buyers must use all the available savings in their CPF Ordinary Accounts for the purchase of or taking over the flat before any housing loan is granted by HDB. You may set aside the amount required for payment of stamp, registration and conveyancing fees and CPF Home Protection Insurance Premium (if applicable).

You can use all the CPF savings in your Ordinary Account to pay up to 100 % Valuation Limit (VL) of the flat. The VL refers to the purchase price or the value of the flat at the time of purchase, whichever is lower. If your HDB loan is still outstanding when the total CPF withdrawals towards payment of the flat reach the VL, you may use additional CPF savings from your Ordinary Account if you have set aside the prevailing Minimum Sum cash component.

For more details, you can visit  CPF Board’s website.

Restriction on use of CPF funds and HDB loan for HDB flats with less than 60 years of remaining lease

From 1 Jul 2013, the rules on the use of CPF funds and HDB loan for purchase of public housing with less than 60 years of remaining lease are as follows:Screen Shot 2015-04-13 at 8.13.00 pm

Restriction on application for another HDB loan

Upon obtaining a housing loan from HDB, buyers will not be allowed, within 30 months from the date of loan disbursement of the flat, to obtain another housing loan from HDB.

Interest Rate

The HDB concessionary interest rate is pegged at 0.1% point above CPF Ordinary Account Interest Rate. It is revised quarterly in January, April, July and October each year, in line with the revision of CPF interest rate.

Repayment of HDB Loan

You can use your CPF savings and /or cash to service the monthly instalments of the housing loan. The monthly instalment is payable on the first day of each month. If the instalment is not paid within the month, a late payment charge will be imposed based on the outstanding instalment as at end of the month. Any payment received by HDB will first be used to settle the outstanding late payment charges. Any balance will then be applied towards the payment of the other outstanding charges. 

Buyers paying the monthly loan instalments partially or fully by cash, must pay them through GIRO.


Progress Payment [Applicable for flats sold under the Design, Build and Sell Scheme (DBSS)]

Where the developer offers progress payment to buyers, the HDB loan will be disbursed progressively to meet the progress payments during the construction period. Buyers will commence payment of their monthly instalments once the HDB loan is disbursed under the Gradual Repayment Plan i.e. the instalments will be calculated based on the amount of loan disbursed over the outstanding loan duration. The instalment amount will comprise both interest and principal.

Existing flat owners with a mortgage loan will have to continue to service their existing loan while making payments for the new loan for a DBSS flat once the loan has been disbursed.

If existing flat is disposed after the buyer has taken possession of the DBSS flat, where HDB housing loan has been fully disbursed, the loan quantum will be reduced taking into account the CPF refund and cash proceeds realised from the flat.

In a situation where existing flat is disposed in the midst of the construction of DBSS flat (where monthly instalment is still being paid according to the Payment Schedule), the buyer has to use the sales proceeds to redeem whatever loan that has been disbursed towards the progress payment and use the balance proceeds towards payment of subsequent progress payments. Developer can take action on the buyer for non-payment. HDB would only start to disburse the net loan after the buyers’ CPF refund and cash proceeds have been exhausted, in accordance to the payment schedule.

After booking the DBSS flat, while waiting for the DBSS flat to be completed, in addition to the HDB loan obtained for the DBSS flat, the DBSS flat buyer may wish to get a 2nd HDB concessionary loan to buy another resale flat for transitional housing. Upon disposal of the resale flat, CPF refund and up to 50% of the cash proceeds from the disposal of the resale flat must be used to reduce the DBSS loan.


Partial Capital Repayment and Redemption of Loan

The buyers/transferees can from time to time submit an application to HDB to make partial capital repayment of the Principal Sum (over and above the monthly instalments to be paid) provided such payment is made within one (1) month from the date of receipt of the said application. Notwithstanding the foregoing HDB reserves the right not to accept any such payment or to accept such payments only if it is of a sum of not less than a minimum sum as may be determined from time to time by the HDB in its discretion.

Buyers can also fully redeem the loan by giving one month’s prior written notice to HDB . For redemption after complete disbursement of loan, the buyer should pay the whole of the Principal sum then outstanding and all other monies due including interest up to the date of payment.

Insurance on Housing Loan

There are two types of insurance you have to take out:

HDB Fire Insurance Policy

If you are taking a loan from HDB, you will have to take out a fire insurance policy from the Insurance Agent appointed by HDB.

Home Protection Scheme (HPS)

HPS is a mortgage-reducing insurance scheme administered by CPF Board. It insures CPF members and their families against losing their homes should members become permanently incapacitated or pass away. HPS insures members up to 65 years of age or until their housing loan is paid up, whichever is earlier.

If you are using your CPF savings to pay your monthly housing loan instalments, you have to apply for HPS.

For more information on HPS, you can obtain an HPS booklet at HDB Hub or call CPF Board or visit the CPF Board’s website.

References: Information are taken from HDB Website, under “HDB Housing Loan

Alright! Basically that’s it!

Thank you for “lasting” all the way here!
Hope you have learnt something today!
Please comment below on what is the next topic you would like me to cover!
If you have learnt something, help me by sharing this post!

Have a great week ahead! 🙂

Ken Seah

HDB Housing Grants

Disclaimer: The following is taken from the HDB Website.

Click on the link the directly bring you to the different grants available/eligibility conditions etc.

The CPF Housing Grant is a housing subsidy provided by the government to eligible buyers of HDB flats. The CPF Housing Grant (in the form of CPF Monies and not cash) can be used for the initial payment or to reduce the mortgage loan for the flat purchase.

The various CPF Housing Grants available are:

Types of flats CPF Housing Grant Available
Buying flats from HDB
Buying DBSS flats from developers
Buying EC from developers