For HDB home-seekers, the dilemma of getting a BTO or Resale HDB Flat can be a splitting headache.
Curious about the number 1 discerning factor for other buyers?
The waiting time might deter you if you’re considering a BTO. You have to endure it before you finally get the keys to enter your new home.
Here are other differences between buying a New Launch BTO and a Resale Flat.
|New BTO Flat||HDB Resale Flat|
|Price||A new flat is sold at a subsidised price.||The price is negotiated between you and the seller.|
|Locations||Flats are mostly located in non-mature estates.||Flats in all locations may be put up for sale.|
|Mode of Purchase||Sale launches are held periodically, and applicants apply directly to HDB for a flat.||Flats can be purchased from the open market any time.|
Have you decided that you don’t want to wait a few years for your new home? Or, are you the husband-to-be who doesn’t plan to use BTO to pop the once in a lifetime proposal question?
If you’re dead set on the resale option, read our step-by-step guide to find out how you can buy an HDB Resale Flat on your own!
How to buy an HDB Resale Flat on your own?
- Login to HDB Resale Portal to register your intent to buy
- Plan your finances
- Shortlist the HDB flat you want
- Receive the HDB OTP (Option to Purchase) from the seller and exercise it
- Submit resale application to HDB
Pre-Purchase Checks for Home Seekers
Before you go ahead, you should double-check whether you are eligible to buy a resale flat here for specific eligibility schemes unique to you.
For general eligibility schemes that apply to all, there are 2 primary considerations.
Lucky for you, there are no income ceilings for the purchase of HDB Resale Flats! However, it might affect the CPF Housing Grants that you can apply for.
Ownership of Additional Properties
By purchasing a Resale Flat, you should not have any other HDB Flats, private or overseas property. If you do own one, dispose of them within 6 months of your resale flat purchase transaction.
1. Register your intent to buy
Login to the HDB Resale Portal via your Singpass to register your “intent to buy” an HDB Resale Flat.
There is no fee involved for this registration, and you will receive an instant evaluation on your eligibility to buy a resale flat. Also, you can view all the housing grants you can apply for and whether you can take an HDB housing loan.
2. Plan your finances
In determining the suitable flat choices within your budget, here are some financial planning considerations to make it easier for your search.
- Cash and CPF savings
- Housing Loan
- CPF Housing Grant Scheme
- Payments involved
First, use these HDB financial tools to get a gauge of your current financial position and how much you can borrow.
Cash and CPF savings
Here’s what you can only pay by cash:
- A deposit to the seller (a maximum of $5,000, paid in 2 stages: the option fee, and the deposit)
- Part of the initial payment (if you take a bank loan, or have insufficient CPF savings)
- Amount not covered by CPF savings and eligible housing loan amount
- Cash proceeds from disposing of the last flat if you are taking a second HDB loan*
Part of the cash proceeds from the disposal of your existing or previous home will be set aside if you are getting a second HDB loan. This amount determines the loan amount for your second loan.
How can you use your savings in your CPF Ordinary Account (OA)?
- Initial payment in whole or in part (depends on whether you use an HDB or bank housing loan)
- Partial or full payment for the flat purchase
- Monthly mortgage instalments
You can take on a housing loan with HDB or a Financial Institution (FI).
|HDB Housing Loan||You must have applied for HDB Loan Eligibility (HLE) letter and received a valid HLE letter so sellers can grant you the OTP.|
|Financial Institution Housing Loan||You must obtain a Letter of Offer (LO) from the FI before you exercise the Option to Purchase.|
CPF Housing Grant Scheme
You can use the CPF Grants for the initial payment of your flat and for reducing the housing loan amount. Check the different types of CPF housing grants here.
Too much to digest? Here’s a summary of the principal payments you have to make for a Resale Flat purchase:
- Deposit to the seller (Option fee and deposit)
- Initial payment
- Cash payment for balance purchase price
- Additional miscellaneous costs
3. Shortlist the HDB flat you want
Various online platforms have made it a breeze for you to search for your dream home on your own. Different platforms will offer you different experiences. You can decide which platform best suits your needs!
If you have specific estates and attributes that you already set your mind on, you can try Carousell Property for a quicker browsing experience with its inbuilt navigation tools.
Open the Carousell Mobile Application & click on the Property Category.
Browsing through many properties that do not fit with your criteria can cause you much frustration and wasted time. Shorten the process by making use of these Quick Filters!
When shortlisting the locations you want your next home to be, you may also take into account specific considerations. For example, choosing an HDB near to your parents’ place means that you can apply for the HDB Proximity Housing Grant (PHG).
After you’ve chosen your ideal flat, you should first do a check on the Ethnic Integration Policy (EIP) and Singapore Permanent Resident (SPR) Quota of the location here.
Singapore is a multi-racial society, and the government takes various measures to maintain harmony amongst the racial groups. EIP was established to ensure that HDB estates and blocks have a healthy and balanced mix of the multiple ethnicities.
As for SPR, it is a quota that ensures PRs can integrate into the local community. This applies to non-Malaysian SPR households where no buyer is an SG citizen or Malaysian SPR.
Note: Complete these checks and verify them before you move on with Steps 4 and 5
4. Receive the HDB OTP (Option to purchase) from the seller and exercise it
Once you have reached a consensus with the seller regarding the sale price, they will then offer you an Option to Purchase (OTP).
|The OTP is the only legal contract between you and the seller.|
When they exercise the OTP, you must sell them the flat at the negotiated price by law, even if there are higher bids. The duration of the OTP stands for 21 days, up to 4 pm on the expiry date.
Once 21 days have lapsed, the seller can offer the flat to anyone else, and you lose your chance to purchase the flat.
This also means that if for some reason you decide not to purchase the flat anymore, you do not have to do anything but wait for the expiry date to be up.
If everything’s right and you are firm with the purchase, seal the deal by exercising the OTP!
Sign on the form and pay a deposit to the seller, which should not amount to more than S$5,000 inclusive of the option fee.
5. Submit resale application to HDB
Once that’s out of the way, both you and your sellers will now have to submit your respective portions of the resale application separately, within 7 days of either submission.
Complete the resale procedure by making sure that the second party submitted the application.
What next? Attend the HDB Appointment with the seller and get the keys to your new home!
480 Lor 6 Toa Payoh
Mon-Fri: 8.30AM – 5PM
Sat: 8.30AM – 1PM
Note: Here are some conditions for your information after buying your resale flat
Purchasing your resale HDB flat in Singapore
That’s really it to the “direct home purchase” journey! Congratulations, you are now a proud owner of your new home.
Here’s a pro tip: Buying your flat via the HDB Resale Portal is a lot easier for the buyer as compared to the seller, as they will be doing most of the work. *wink
If you have made it through this article, you should be an expert at purchasing your own resale flat by now. All the information you will need is readily available at your fingertips.
Remember to share this article to benefit your fellow peers looking to buy an HDB resale flat on their own!