Buying HDB Resale for First Timers

Embarking on the journey to purchase your first HDB resale flat in Singapore is both exciting and significant. Understanding the process and associated costs can help you navigate this journey with confidence. Here's a guide to assist you:

Timeline for Purchasing an HDB Resale Flat

1. Obtain an HDB Flat Eligibility (HFE) Letter

   Duration: Processing time for HFE letter is approximately 1 month and is valid for 9 months. It's advisable to secure this before starting your search.

   Details: Apply for an HFE letter through My Flat Dashboard to understand your eligibility for purchasing a resale flat, including potential CPF housing grants and HDB housing loan amounts.

   
   

2. Search for a Suitable Flat and Secure an Option to Purchase (OTP)

   Duration: Flexible; depends on individual preferences and market conditions.

   Details: Explore available resale flats that align with your budget and needs. Once you find a suitable option, obtain an OTP from the seller.

   
   

3. Secure Financing

   Duration: Approximately 2 to 4 weeks.

   Details: Decide between an HDB loan or a bank loan. If opting for an HDB loan, ensure you have a valid HFE letter. For bank loans, obtain a Letter of Offer (LO) from your chosen financial institution.

   
   

4. Exercise the Option To Purchase (OTP)

   Duration: Within 21 days from the OTP date.

   Details: Formally agree to purchase the flat by exercising the OTP within the stipulated timeframe.

   
   

5. Submit Resale Application

   Duration: Both buyer and seller must submit their portions within 7 days of each other. The duration here may vary anywhere between a day to 120 days or more. This timing is agreed upon between buyer and seller.

   Details: Complete and submit the resale application via the HDB Resale Portal. An administrative fee applies: $40 for 1- and 2-room flats, or $80 for 3-room and larger flats.

   
   

6. Attend the Resale Completion Appointment

   Duration: Typically scheduled 8 weeks after HDB receives the resale application.

   Details: Finalize the transaction during this appointment, after which you receive the keys to your new home.

   
   

Costs Involved in Purchasing an HDB Resale Flat

1. Option Fee

   Amount: Between $1,000 and $5,000, depending on agreement with the seller.

   Details: Paid to the seller upon granting the OTP. This fee is part of the purchase price and will be deducted from the total upon completion.

   
   

2. Valuation Fee

   Amount: Approximately $120.

   Details: Covers the cost of valuing the flat to determine its market value.

   
   

3. Stamp Duty

   Amount: Calculated as follows:

   • Below $180,000: 1%

   • $180,001 to $360,000: 2% - $1,800

   • $360,001 to $1,000,000: 3% - $5,400

   • $1,000,001 to $1,500,000: 4% - $15,400

   • $1,500,001 to $3,000,000: 5% - $30,400

   • Above $3,000,000: 6% - $60,400

   Details: A tax levied on the purchase, payable to the Inland Revenue Authority of Singapore (IRAS).

   
   

4. Legal Fees

   Amount: Ranges from $288 to $2,300, depending on the complexity of the transaction.

   Details: Covers conveyancing services, including title searches and preparation of legal documents.

   
   

5. Home Protection Scheme (HPS)

   Amount: Varies based on loan amount, age, and health status.

   Details: A mortgage-reducing insurance that protects CPF members and their families against losing their homes in the event of death, terminal illness, or total permanent disability.

   
   

6. Fire Insurance

   Amount: Approximately $1.50 to $7.50 for a 5-year term, depending on flat type.

   Details: Mandatory insurance to cover the flat's structure against fire damage.

   
   

7. Renovation and Furnishing Costs

   Amount: Varies widely based on preferences and flat condition.

   Details: Budget for potential renovations and furnishings to make the space your own.

   
   

8. Agent's Commission (if applicable)

   Amount: 1% to 2% of the purchase price

   Details: Hiring an agent is optional but beneficial for handling negotiations, paperwork, and ensuring a smooth transaction.

   
   

9. Renovation Costs

   Amount: Varies depending how extensive your renovation works are.

   
   

   Buying your first HDB resale flat is a major milestone, and understanding the timeline and costs involved ensures a smooth and stress-free experience. If you need guidance, feel free to reach out—I’d love to help you find your perfect home!

*The timeline above serves as a general guide, but actual processing times may vary based on individual circumstances, financing approvals, and HDB procedures.

If you wish to read in more details, you may visit HDB wesbite for resale purchase.