Private property Buyer Guide
Making the right choice.
You should first apply for an in-principle approval for a loan. This helps you to narrow down the type of properties you can afford.
A chat with an experienced and skilled agent will help you get clarity into budgeting for renovations, stamp duties, adhoc expenditures and tax optimisation methods to go forward with your property purchase.
Location depends on what is your priority. What are the amenities that you need?
Homes that are within walking distance malls and train stations are usually preferred by majority compared to areas that are a bit more far flung and quiet.
Schools within 1KM. If you have young children, this is a very important consideration. It might even be number one reason you’re moving or buying a property. You can use SLA’s school query one map to check what are the schools within the property you are looking at or you can do the reverse, check what is the radius of 1km within the school you are aiming to get your child into.
Distance to your in-laws (near to them or rather away from them!)
If you visit or rely on your in-laws, it would be a wise choice to stay close to them so you would not be spending time and money travelling to and fro.
If you require a property for move-in urgently, then you would need to shortlist properties at the onset that comes delivered as vacant possession. Sometimes the tenancy can end during the completion period after OTP (option to purchase) is signed.
If the property is sold with a tenancy agreement, be sure to see the original tenancy agreement and if you are not sure of the contract terms, please ask a property agent or your law conveyancing firm to explain to you. Look out for terms like break clauses and inventory lists and handover date.
High floor units tend to be pricier as the price sold to these owners are increased by per floor level.
Ground floor has its own charm too but it is also susceptible to insects, privacy concerns and snails crawling directly into the unit. It is almost like staying in a landed property without having to own a piece of land.
Some low floor units enjoy nice greenery views which high floor doesn’t have.
City view, sea view, greenery view, unblocked view?
The usual premium views you would pay for are the sea view, greenery view, unblocked views of the estate and the city and city view.
If you like looking at the pool, you should purchase lower floor units so you can see the pool and all eyes would be naturally focused on what is going on in the pool. It is relaxing to sit and unwind looking at the liveliness going on.
High floor units that offer you unblocked views also come with maximum privacy. If the high floor unit is also facing other units, try to avoid these as it defeats the purpose of paying premium for high floors.
Pool Sizes and Types
Some smaller condos come with a small pool good enough for dipping but not the 50m Olympic sized pool for serious swimmers.
Gym Size and Facilities
Some condominium gyms are fully equipped with weights, elliptical, threadmill, the works. But most are just small gyms. If you’re a gym buff, do check out the gym if it fits your requirements.
Generally, North-South facing homes are windier. However, the wind changes directions every few months and whether the property will be getting the wind depends on whether there will be any blockage in front of the apartment.
N-S facing apartments do sometimes get afternoon sun at different parts of the year.
The direction, though facing west, may get different amounts of afternoon sun at different times of the year at different angles.
East facing homes get morning sun but get darker earlier than west-facing homes.
Natural Ventilation and Brightness of property. These are factors that are permanent and renovation cannot change it.
Most people prefer bright and breezy apartments. If the apartment is surrounded on all sides, it can feel stuffy inside the apartment no matter the temperature outside.
Unit Layout
Do you need privacy in the layout so the bedrooms do not all open to the living room but open to a hallway? That hallway will take up extra floor space but it may be necessary if you want privacy.
Do you like outdoor spaces like balconies and patio? If not these are wasted spaces which you will not end up using.
Will you need to house your in-laws? If you need to and want some privacy, you can consider the dual-key layout.
Is there a significant void or mezzanine space? These unusable spaces make your price per psf even higher.
Is there a lot of wasted corridor spaces? Savvy buyers prefer optimised use of space within the apartment.
Is the layout flexible? Are the walls “knockable”to open up to bigger spaces or combining bedrooms? Do you want to have less walls and more open concept?
Are the rooms and spaces regular shaped? Regular shaped layout is usually preferred as furniture can be placed without losing any odd corners.
Where is the rubbish chute? Is it within the unit or outside?
Is there a yard to do and hang laundry? Otherwise, all your clothes have to be put into the dryer.
Do you need a study?
During this Covid-19 crisis, almost all are working from home and this may become a norm in the future. A study is usually not big enough for a bedroom and it may be a luxury to have a dedicated room for study.
Side Gates, entry and exit routes, shortcuts are there?
If you’re located near the MRT or mall, there are usually side gates to exit nearest the mall that can save you lots of time walking around the compound.
Parking Space
Some smaller boutique developments have no visitor lots and very limited owner lots. Especially if the development is near an MRT station. There is limited land on which to develop and the developer sometimes leave parking out completely.
If you have multiple cars, it would be good to check how much additional parking costs. Usually, a private apartment will allow complimentary parking for one or two cars per unit.
If you have parties or entertain frequently, it would also be good to find out how many visitor parking lots there are.
Neighbours per floor
Typically, a condo has 4 to 7 neighbours per floor. Premium condominiums have private lift lobbies.
Who’re your neighbours?
Not compulsory but it would be good to check who’s your future neighbours.
Timeline
Click on any one of the icon to find out more.
• The law firm will deliver the
exercised OTP by hand to the
seller law firm together with
the 4% exercising fee.
• Prior to this, the lawyer ensure
all legal requisites and searches
such as bankruptcy searches
comes up clean.
• Once received, the seller lawyer
will also serve redemption
notice to the seller’s CPF and
bank (if applicable).
• You will need to execute the
OTP before your lawyer, and
pay the balance downpayment,
usually 4% of the purchase price.
• The Lawyer will calculate
how much cash, CPF and bank
loan and take your instructions
on how much to be used.
• To obtain the OTP, you will
pay an option fee, normally
1% of the purchase price.
• Once you’ve paid the option
fee, the seller is not allowed
to sell the property.
Click here to find out
how much stamp duties you
have to pay.
If you are using CPF to pay
stamp duty, do take note that
you have to pay using your
own cash first and get
reimbursement from CPF on
completion date.
Click here to find out the reason
why, CPF cant be used to
pay stamp duty directly.
• Your lawyer will help to apply
for your CPF and also liaise
with the bank to drawdown
the loan.
You can find out more about
using your CPF for your private
property purchase here.
• The seller law firm will compile
the completion account after
receiving the outstanding
redemption statement from
seller’s CPF and bank (if
applicable).
• The buyer lawyer wil check
the completion account that
states how much is payable
to the seller’s payee.
CONGRATULATIONS!
You are now a proud owner
of your new home!
• Keys collection is typically
after 530pm on completion
date, seller is obliged to
give you one set of keys to
enter the property.
ie one set of keys to metal
gate, main door, letter box.
• The buyer’s law firm attends
completion in the seller law
firm typically between 2-5pm
in the afternoon.
• Both sides law firm will
check the documents to
ensure everything is
correct before handing over
the keys and cashier’s order.
• The buyer will purchase the
respective cashier’s order
according to the completion
account and pass to the lawyer.
• Do note that cheques are not
allowed for completion as
there’s a chance that cheques
might bounce.
• The law firm will also give
instructions to CPF and
bank for the draw down of
funds for the completion.
Steps and procedures
Once you have settled and decided on buying a property, the seller will usually grant you an Option to Purchase (“Option”) in exchange for your payment of an Option Fee. This Option Fee is usually 1% (or more) of the property sale price and will usually be payable by cheque directly to the sellers. Once the Option is granted, the sellers cannot grant another Option to another prospective buyer until the current Option expires.
The Option will contain several terms and conditions, including crucially, the mode of exercising the Option and the deadline for doing so. You should note that a failure to exercise the Option in accordance with the prescribed mode and before the stipulated deadline would result in you losing your right to exercise the Option. You would forfeit any Option Fee paid and the property can then be put up for sale to another buyer.
Please do note that once the Option Fee is paid and the Option granted, the terms and conditions contained in the Option cannot be varied or changed unilaterally. The seller has no legal obligation to vary terms in the Option once granted to you as the buyer.
Prior to the exercise of the Option, your lawyers will conduct various legal searches to protect your interest. These include title searches, and bankruptcy and course book (litigation) searches on the sellers.
Your lawyers will also carry out several legal requisitions, which are basically formal enquiries to various government bodies such as the LTA, URA and PUB to ensure that there are no future government plans which would affect the property. If any of the legal requisitions are unsatisfactory, there is usually a term contained in the Option which allows you to not proceed with exercising the Option and to allow you to obtain a refund of the Option Fee.
Assuming all searches are satisfactory, your lawyers would usually exercise the Option on your behalf. In order to exercise the Option, the deposit sum (usually 4% of the purchase sum or more) would have to be paid by cashier’s order. Such a deposit would usually be held by the sellers’ law firm as stakeholder until Completion, and would not immediately be paid to the sellers. As an alternative, the deposit can also be held by the Singapore Academy of Law as a stakeholder. However, the latter is less common in practice as it is more inconvenient and also attracts higher bank charges.
The stamp duties payable by both parties should be paid within 14 days of signing the sales and purchase agreement.
Leading up to completion, your lawyers will advise you on various cashier’s orders you would need to prepare for payment of the balance sum.
Your lawyers will also liaise with the bank to execute the mortgage (if a bank loan has been taken out) and with the CPF Board to execute the CPF Board’s security documents (if you intend to use your CPF funds to finance the property).
keys collection is usually at 6pm on the completion date itself.
The seller will hand over the keys of the property to the buyer, in exchange for the payment of the remaining 95% of the agreed price. The 4% deposit will also be released by the intermediary to the sellers. The property should be delivered in the same condition (notwithstanding fair wear and tear) as it was on the date of the option or contract, whichever is earlier unless otherwise agreed between both parties.
The seller’s lawyers will also hand over the transfer documents, with the details of the change in ownership of the property, to the buyer’s lawyers. This will allow the buyer’s lawyers to apply for a Certificate of Title with the SLA.
Post Completion
If the unit is tenanted : The consent of the tenant must have been sought earlier to transfer the security posit to the new owner.
There will not be any keys given to the purchaser on completion if the property is sold with tenancy but the tenancy agreement held by the vendor should be forwarded to the purchaser for safekeeping.
The Chief Assessor, IRAS must also be notified of the change in ownership of the property.
The vendor’s solicitors send out notices to the Management Corporation, IRAS and tenant (if the property was sold with tenancy) to inform them of the change of ownership.
The purchaser’s solicitors have to ensure that the Instrument of Transfer, the Mortgage and/or CPF documents are duly registered after completion. Registration is normally undertaken by the mortgagee’s solicitors unless otherwise agreed. The other solicitors would have to be notified of the lodgment particulars and numbers allocated to each instrument.
After final registration of the documents, the title deeds will be returned by the Registry and forwarded to the Purchaser’s mortgagee or CPF Board for safe-keeping.