Do these BEFORE buying a property

Do these BEFORE buying a property

These are the steps you need to take BEFORE buying a property in Singapore


There’s a saying that luck is when opportunity meets preparation. This means that when it comes to buying a good property, there are no lucky buyers; only prepared buyers. If you have been toying with the idea of one day buying a property in Singapore of your own, here are some steps that you can take to better prepare yourself for that day.


Consider what type of housing to get and its location

As with all things, we need to begin with an end in mind. The first step is to envision the type of home you would be getting. Consider your current situation and balance your needs with your wants. Do you need a condominium as a first property? This is usually because your options are limited due to your citizenship or your income exceeding the stipulated income ceiling. If not, first-time Singaporean homebuyers should always consider getting a subsidised HDB flat over other types. The ability to purchase a subsidised HDB flat is an advantage that is given exclusively to Singaporeans in terms of home ownership. You should also research on the location of your desired property, which will eventually affect the price of your house.

Plan your budget wisely

Next, you will need to work out your budget. The simplest way to do this would be to take your total household income and subtract your total household expenses to get your total combined monthly savings. From this amount, figure out how much you are willing to spend on property-related expenses like mortgage repayments, conservancy charges or condo maintenance fees, renovation fees and so on. Of course, this is a very rough estimate that does not factor in CPF contributions, so feel free to contact us if you need help in this regard.

Preparing a good credit score

Subsequently, one of the trickiest parts of buying a house is the financing part. To prepare for this, you need a good credit score to get favourable loan terms. You can check your current credit score from Credit Bureau of Singapore, and take active steps to improve your credit score in preparation of your home purchase.

Have cash ready and calculate maximum loan available

You should also start saving as much cash as you can because you will need to pay a portion of your home purchase in cash due to current regulations. Current regulations aim to ensure that homeowners do not overcommit on their loan obligations. This means that you will also need to check your Total Debt Servicing Ratio (TDSR) and your Mortgage Servicing Ratio (MSR) to see how much of a loan you can actually take up.

Good luck, and be prepared!

At the end of the day, these suggested steps are just to help you to better prepare yourself as a potential home buyer. When the right opportunity comes, you will then be well-equipped to take advantage of it. Good luck in getting your dream home, and more importantly, make sure you are well prepared for it! That’s it for today, this is Isaac, keeping property real for you.

Buying a second property and may incur Additional Buyer’s Stamp Duty? Check out our article on how you can avoid paying ABSD (legally!).

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Why engage a good property agent?

Why engage a good property agent?

This is why you need to engage a good property agent:

For the past few weeks, you have been diligently searching for the ideal property online on places like PropertyGuru or 99.co. It suddenly occurs to you how easy property agents’ jobs must be. After all, they seem to collect thousands of dollars in commission by simply putting up a few listings online and occasionally conducting a few viewings here and there. It does not make sense to you to pay thousands of dollars for someone to do those things that you can easily do on your own. To that end, I will say that you are both wrong and correct.

The law requires agents to always protect you

For starters, let me first explain why you would be wrong. Firstly, one of the most sacred duties of your property agent would be to do due diligence on your behalf. This is a huge category of duty that can be as simple as detecting defects in a home inspection, to making sure that you are not getting ripped off by the other party in the property transaction. This duty of care is enshrined by the Council for Estate Agencies into legislation. This means that your agent is required by law to always act in your best interest. Kind of important to have someone looking out for you especially in a big-ticket item like a house!

Experience and Expertise

Next, an agent brings with him or her experience and expertise. This is necessary to help negotiate the best deal for you. Let me illustrate this point with an interesting story. There was once a rich businessman whose sports car broke down. He could not fix the engine despite calling several mechanics. Finally, an old mechanic came and after inspecting the engine, he used a small hammer to tap on the side of the engine. The engine roared to life. The businessman was invoiced for $1000 the next day. He was furious! He called up the mechanic and complained that a tap of the hammer couldn’t have costed more than $1. The mechanic calmly explained the invoice, “3 taps of the hammer – $1. Knowing where to tap – $999”. In the same way, good property agents deserve to be paid for delivering quality judgement and service to you. We advise you to invest that few thousands of dollars in engaging a good property agent. You could be saving much more money when the agent negotiates a fantastic price for your property transaction!

Invest for quality analysis to avoid pain in the future

Lastly, good property agents bring their money’s worth to the table if they are able to accurately analyse the broader market trends and developments. This is to provide you with the necessary inputs so that you can make the right decisions with regard to your big-ticket purchase such as what to buy, where to buy and how much to buy it for. This can largely minimise your chances of making errors, which you can ill afford for a property purchase that can easily cost over half a million dollars.

Cut out the dead weight!

Now, to the part that you might be correct. If your current property agent is only capable of putting listings and conducting viewings with nothing else to bring to the table, cut him out. You are better off doing the transaction on your own and saving on the agent’s commission. In short, while a good property agent can make all the difference in a property transaction, a lazy property agent is nothing more than dead weight. It’s very important that you be very selective about the property agent you choose to engage. A good property’s agent may potentially save you thousands of dollars- maybe even more than his or her commission! They may even provide valuable insights, such as how to avoid paying ABSD when buying your second property.

I hope you have gained some insights for today, this is Isaac, keeping property real for you.

If you like our content, be sure to like, comment on the video and subscribe to our Youtube channel. You can also bookmark our page!

Legally Avoiding ABSD in Singapore

Legally Avoiding ABSD in Singapore

How to avoid paying ABSD LEGALLY in Singapore


You’ve just made the deal of your lifetime and you’ve landed on a sizeable amount of cash. Being a wise property investor, you decide to invest the extra money in a second property. Just then, you realise that you may be liable for Additional Buyer’s Stamp Duty, commonly known as ABSD.

ABSD and what it means

Additional Buyer’s Stamp Duty (ABSD) was introduced in December 2011 by the Singapore government. This was to curb speculative buying in the property market. It was further raised in 2018 because the Singapore government believes that property prices have risen much faster than economic growth. If you are a Singaporean citizen buying a second property, tragedy! You are liable to pay a whopping additional 12% of the property’s price on top of the baseline Buyer’s Stamp Duty. However, there are some legal ways that you can use to avoid paying ABSD and I will be glad to share them with you today.

1. Through a trust

Firstly, if you are lucky enough to have children below 21 years old, you can buy your second property through a trust. Thereafter, list one of your children as the beneficiary, and you the trustee. This means that ABSD would not need to apply to this property since it’s a first property. However, it also means that the property legally belongs to your child. You are merely taking care of it until he or she meets the age requirement specified in the trust. This may potentially create future conflicts, so you have to be mindful of the potential consequences! In addition, no banks will grant mortgage to a child. You will most likely have to pay for the property with full cash. Good thing you made that sizeable amount of money earlier!

2. By decoupling

Secondly, if your current property is owned jointly with your partner, you can consider decoupling to avoid paying ABSD. This means that one of you will transfer the full ownership of your current property to the other. This can either be done by the way of a gift, or by selling your share to your partner. However, this may also create potential conflicts. One of you will have to legally own a lower valued property than the other. This is of course unless you and your partner can have unwavering trust in each other. If that is indeed the case, I am very happy for you.

3. Purchase under different names

Lastly, if your current property was purchased solely under your name, simply buy your second property under your partner’s name. Since this would technically be your partner’s first property purchase, your partner would not be liable to pay ABSD for the new property. As with the previous two approaches, this may also create potential complications in the event of a divorce or death.

HDB flats’ restrictions

As a final add-on, some of these measures may not work if your current property is a HDB flat because HDB flats are subjected to much more restrictions. For example, decoupling of HDB flats has been disallowed since 2016.

In a nutshell, these are ways that you can potentially avoid paying ABSD. You will have to carefully decide if the money saved on ABSD outweighs the likelihood and the severity of the potential implications that have been mentioned. I hope that you’ve gained some useful insights, and that’s it for today! This is Isaac, keeping property real for you!

If you’re buying your second property, decide if it’s better for leasehold or freehold by checking out our analysis!

If you like our content, be sure to share, like, and comment on the video and subscribe to our Youtube channel. You can also bookmark our page!