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Private Property Sales Process in Singapore

private property sales process

A property is transacted at an agreed selling price between the developer (seller) and the buyer. This price excludes stamp duties, legal fees and all other professional fees which have to be borne by the buyer. The two main modes of property transactions are mentioned below:

Purchase under the Housing Developers’ Rules for uncompleted projects:

  • A property is considered booked when the developer has given the buyer an Option to Purchase upon payment of a booking fee.
  • The booking fee payable for an Option to Purchase is 5% of the purchase price. After an Option to Purchase is granted to the buyer, the developer is required to, within a period of 14 days from the date of Option, deliver the Sale & Purchase Agreement and copies of the title deeds to the buyer or his representing lawyer for review. The Sale & Purchase Agreement will be in the form prescribed under the Housing Developers’ Rules.
  • The Option to Purchase will expire three weeks after the date the Sale & Purchase Agreement and copies of the title deeds are delivered by the developer to the buyer or his lawyer. If the buyer wishes to exercise the Option to Purchase, he must sign and return all copies of the Sale & Purchase Agreement to the developer before the Option expires.
  • After exercising the Option to Purchase, the buyer is required, within eight weeks from the Option date, to pay an amount equivalent to 20% of the purchase price, less booking fee.
  • The buyer has to pay applicable stamp duties to the Inland Revenue Authority of Singapore within 14 days of signing the Sale & Purchase Agreement.
  • If the Option to Purchase is not exercised before it expires, the developer will entitled to 25% of the booking fee and refund the buyer 25% of the booking fee. Thereafter, the developer can sell the property to any other interested party.
  • The Option to Purchase is personal to the buyer. The buyer is not allowed to convey, assign or transfer the Option to Purchase that has been granted to him/her by the developer to any other persons.

Purchase of completed projects under private treaty:

  • The Option to Purchase is given to the buyer upon payment of the booking fee, which is usually between 5% of the purchase price.
  • The buyer is given 14 days to exercise the Option to Purchase and pay 20% of the purchase price less the booking fee. If the Option to Purchase is not exercised before it expires, the booking fee is wholly forfeited by the seller.
  • The buyer has to pay applicable stamp duties to the Inland Revenue Authority of Singapore within 14 days of signing the Sale & Purchase Agreement.
  • Completion of sale takes place 8 weeks from the date of the Option to Purchase.

Progressive Payment Schedule

For uncompleted projects, the developer collects payments from the buyer in accordance with the payment schedule specified in the Sale & Purchase Agreement as follows:

 
Payment Schedule% of purchase price
Option to Purchased granted5% (booking fee)
Upon signing of Sales & Purchase Agreement or 8 weeks from Option date20% less booking fee
Upon Completion of:Generally collected over three years
Foundation work10%
Reinforced concrete framework10%
Brick walls of unit5%
Roofing / ceiling of unit5%
Electrical wiring, internal plastering, plumbing and installation of door and window frames5%
Carparks, roads and drains serving the housing project5%
TOP (when developer is ready to hand over the vacant possession of the unit)25%
On Certificate of Statutory Completion15%

Other Payments

Besides the purchase price, there are other payments which a buyer is required to make under the Sale & Purchase Agreement, such as the following:

  • All property tax is levied in respect of the unit after the buyer receives from the licensed developer the Notice of Vacant Possession.
  • If the unit is in a strata-titled housing project, maintenance charges for the maintenance of the common property and the provision of cleaning and other services from the date the buyer actually takes possession of the unit or the 15th day after the buyer receives the Notice of Vacant Possession in respect of the unit, whichever is earlier.
  • The buyer will also have to pay the legal fees for services rendered in the purchase of the property and for mortgage documentation relating to a bank loan for the property, if any.

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