Dream home cost and consideration.

This season, there’s been a heap of crazy deals. This year February has recorded as the second-strongest February since 2012 as new private home sales jumped 114% year-on-year in February.
Other than that, if your MOP period is up and you plan to upgrade to private property, this is the time despite the pandemic season.
Developers are currently offering crazy deals, but for a smaller size unit. We have seen units as low as $860,000 to $1.4 Million.
Before that, this article here is to remind you of the extra cost you’ll need to weigh.

1. Buyer stamp duty and Additional Buyer’s Stamp Duty

Buyer’s Stamp Duty (BSD) is the tax paid upon the signing of Sales & Purchase Agreements (S&P) when you buy or acquire property located in Singapore.
ABSD is applicable if this is your second time buying a house, PR and Foreigner. Here’s a list of how ABSD work:
  • Singapore citizen buying your first residential property 0%
  • Singapore citizen buying a second residential property 12%
  • Singapore citizen buying a third and subsequent residential property 15%
  • PR buying a first residential property 5%
  • PR buying a second and subsequent residential property 15%
  • Foreigner buying any residential property 20%

2. Downpayment

If you are using an HDB Concessionary Loan, you will need to make a down payment of 10 % of the purchase price or valuation, whichever is more eminent. The downpayment can be paid from your CPF Ordinary Account (OA), in cash, or through a combination of both.
If you are applying for a private bank loan, you will need to make a down payment of 25 % of the purchase price or valuation, whichever is more eminent. At least 5 per cent of this down payment must be in cash and the remaining 20% can be paid with your CPF OA, in cash, or a combination of both. For ECs you can only use a private bank loan for ECs.
Our assumptions for the interest rate: 2.6% (public homes); 2.0% (private homes)

3. Legal fees

This is a fee paid for legal service. Law, jurisprudence, a fixed charge for a privilege or professional services.
These are legal fees charged by the legal firms for any work executed. These often start from S$1, 800.

4. Valuation fees

This is something often not spoken of or missed out, for the bank to release funds for you to purchase the property you are interested in, a valuation must be performed. The fee for this will vary depending on the value of the property. It usually costs a few hundred bucks.

5. Agent Commission

Isn’t it easy to get your dream home without searching high and low by the service of Agent?
Now, let’s talk about the cost of it, they come with a price. This commission is usually 1% of the price you purchased the property.

6. Insurance

If you are financing the purchase of your home through a bank, you are likely going to have to obtain homeowners insurance. Many banks require homeowners to protect their investment in the event of fires or flooding. This guarantees security for the collateral for the loan.
We strongly recommend that all homeowners get comprehensive home insurance. This insures you against damage to furniture, renovations and personal belongings. It also covers temporary accommodation and storage costs (you will need both in the event of a fire), and third-party coverage (if the fire is your fault and your neighbour’s house burns down, they might be able to hold you liable for damages).
Although the risk of damage or theft is small, you will also have to renovate and refurbish the house after any disasters, and the financial cost of that is considerable.

7. Other costs

These other costs consist of the cost when you own the house.
Cost of renovating the home
This cost includes painting, ceiling tiles, plumbing and wiring (if required)
Inspection cost 
It is best to check for illegal restructuring or either defect done by the developers or previous owner or you will be deemed liable for the repair cost not done by you.
Maintenance charges 
For condo owners, you should always keep these charges in check (utility bills, parking lot fees and property maintenance)
Furniture Cost
New home, new furniture, it’s best if you spend wisely to buy the necessary item first (Kitchen Equipment, Dining table chair, Bed, lighting)
You might be thinking, wow this is a lot of costs to consider. The list above isn’t 100%, accurate, it’s just a guideline for you to prepare yourself better before moving into the phase of buying a house. We wish you the best of luck in getting your dream house and be well prepared!
Money Kinetics
March 1, 2019
Buying a Home in Singapore 2019 – Costs You Need to Consider Other Than Property Prices

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