To buy property in Singapore is a legal process. Therefore, you will need assistance from a property agent and a conveyancing lawyer. There are some requirements that you need to comply with depending on the property you will buy. That is very much the case with going for the cheapest resale flat in Singapore.
Are you looking to buy the cheapest resale flat in Singapore? In this article, we will discuss the buying process of it. Although a property agent will guide you in buying the cheapest resale flat in Singapore, it is still best that you are knowledgeable about the process.
Step #1 – Intent to Buy registration
The very first step in buying the cheapest resale flat in Singapore is registering for an Intent to Buy. This can be done by submitting an application on the HDB Resale Portal. Only one individual from a family unit is needed to be able to register.
Once the registration is complete, you will be able to find out if you are eligible to buy a resale flat. It is important that you meet the criteria of the HDB eligibility schemes. If not, your other option is to buy property in Singapore that is not a resale HDB. If you are eligible, then you will have to comply with the Ethnic Integration Policy (EIP).
Once registered, you can also determine which grants you can get. You will also know if you can apply for an HDB concessionary housing loan. The Intent to Buy registration is only valid for 12 months. After that, it will expire. In this case, you will have to re-register.
Step #2 – Budget planning
Budget planning is necessary if you opt to buy property in Singapore. In this stage, you need to figure out what type of HDB flat you can afford. There are ways to get funding aside from the savings you have. One way is to use your Central Provident Fund (CPF). You can also take up some housing loans through HDB or a bank.
If you wish to get a loan at HDB, you are required to have a HDB Loan Eligibility (HLE) Letter. You will need this document in order to get an Option to Purchase from the seller. HDB can grant this within 14 days prior to your request.
If you will get a loan from the bank, you need to apply for an In-Principle Approval (IPA). The time of issuance of the IPA will depend on the bank. You should also check if you are eligible for any grants. These grants can help you lessen the amount of money that you need to produce.
Step #3 – Find a resale HDB listing online
Once you figure out the budget, it’s time to search for the cheapest resale flat in Singapore. Nowadays, there are plenty of reliable listings websites that you can search properties in. The two most famous in Singapore are PropertyGuru and 99.co. A great advantage of buying the cheapest resale flat in Singapore is that you can choose from already existing properties.
Step #4 – Price negotiation and OTP signing
The price indicated in the property listing is always open for negotiation. That is why you shouldn’t be afraid of negotiating for a lower price. Usually, a property agent could do this on your behalf. Once you have decided on an amount that both parties will accept, you can ask for the Option to Purchase (OTP). An OTP is a legal contract that will guarantee your right to buy property in Singapore. For 21 days, the seller is not allowed to sell the HDB flat to another buyer.
Furthermore, you will have to pay the Option Fee. This fee is similar to a reservation fee that costs from S$1 to S$1,000. The exact price can be negotiated. In the event that you fail to exercise the OTP, the option fee is forfeited. Furthermore, the seller can now sell the HDB flat to another person who will buy property in Singapore.
Step #5 – Request for Value submission
Once you secure the OTP, you are required to submit a Request For Value for the resale flat. You can submit this through the HDB Resale Portal a day after the Option Date in the OTP. Once submitted, the home valuation process will begin. The whole valuation of the cheapest resale flat in Singapore can take at least five working days.
Step #6 – Exercise OTP and pay Option Exercise Fee
The next step in buying the cheapest resale flat in Singapore is to exercise the OTP. This can be done by acquiring the money you need to buy the flat. Once that is completed, you will go back to the seller to sign the OTP and pay the Option Exercise Fee. This fee is also negotiable and will not exceed S$5,000. Both the Option Fee and Option Exercise Fee will make up a portion of the purchasing price of the HDB flat.
Step #7 – HDB resale flat application submission
The next step is for both the seller and the buyer to submit their part in the resale application to HDB. This will serve as a contractual agreement. Once one party submitted their part in the application, the other party should be able to complete their part within 7 days. If not, the application will expire and they will have to re-apply.
Step #8 – Resale completion appointment attendance
The last step to buy property in Singapore from HDB is to attend the resale completion appointment. HDB will inform the buyer and seller that the application is being processed within 10 working days after the resale application submission. The application process can take up to 8 weeks. During this period, the parties involved should have submitted the necessary document to HDB. Once that is done, HDB will contact both parties to physically attend the Resale Completion Appointment at the HDB Hub. This is also the time that the keys will be handed over to the new owner. Once that is done, the process to buy property in Singapore is complete.
Learn more about property purchasing at SRX Property
Those are the 8 simple steps to consider when wanting to buy the cheapest resale flat in Singapore. A property agent can tell you more details of each step. If you opt to buy property in Singapore on your own, you will need to learn more. Here at SRX Property, we have the up-to-date information on buying properties in Singapore. Explore our website for more information.
Key learnings & Takeaways
- First, register for an Intent to Buy at the HDB resale portal. Then, start planning and analyzing your budget.
- Find a resale HDB online, contact the seller to visit the house, and negotiate for the selling price. Afterwards, sign the OTP.
- Submit a Request For Value for the resale flat. Then, exercise the OTP.
- Return to the seller to pay the Option Exercise Fee. Then, both seller and buyer submit an HDB resale application in the HDB Portal.
- Wait for HDB to schedule a Resale Completion Appointment. Both parties should attend the appointment physically.