Here are seven easy steps, plus a library of acronyms, to make purchasing a resale flat in Singapore a little easier — especially in light of soaring prices. Bookmark this guide for a comprehensive guide on all you need to know about purchasing a pre-owned HDB on the island!
I’m not the best at waiting. There, I said it. Yes, patience is a virtue to many, and, yes, good things do come to those who wait — but I’d really rather have things done asap, especially when it comes to a future home. Don’t get me wrong, there are definite pros to playing the long Built-To-Order game, but it’s just not for me. And I’m pretty sure, I’m not the only one who feels that way. So thankfully, we’ve got an alternative path to take: the resale flat.
Of course, before diving in, we’ve got to address the elephant in the room — escalating prices of resale flats. According to the Business Times, resale flat prices rosed nearly 11 per cent from about a year ago despite the pandemic. In fact, The Straits Times noted that more buyers were leaning towards condominiums now that prices for resale flats were “climbing higher than those for private housing”. In response to all that, HDB has assured the public that they will be monitoring the housing demand and making adjustments where necessary.
So we’re headed into this guide, optimistic, but also aware of the steep incline of resale flat prices. That being said, if you’re still keen on getting a resale flat but completely clueless about the various processes and criteria for owning or buying one in Singapore, you’ve come to the right place. By the end of the guide, you’d be prepped and (hopefully) ready to be a homeowner in 2022.
💡 But first! Let’s jump into some common acronyms used when talking flats in Singapore:
|Acronyms||AKA||What Is It?|
|COV||Cash Over Valuation||👉🏻 When a buyer overpays for an HDB resale flat|
👉🏻 Hike in prices usually happens due to accessibility, amenities, and attributes of the flat
|CSC||Certificate of Statutory Completion||👉🏻 Legal document that allows the building to be occupied|
|DRC||Directory of Renovation Contractors||👉🏻 List of approved home-reno contractors for HDB flats|
|EIC||Ethnic Integration Policy||👉🏻 Racial quota that ensures an HDB block’s units are fairly distributed |
👉🏻 The percentages are roughly 80% for Chinese, 20% for Malays and 10% for others
|MOP||Minimum Occupation Period||👉🏻 Period of time required to occupy flat before you can sell it (different timelines for different kinds of flats)|
👉🏻 Calculated from the date of key collection
|OTP||Option to Purchase||👉🏻 Legal contract between buyer and seller of residential property|
👉🏻 Gives buyer exclusive rights to purchase the property from the buyer
|SBF||Sale of Balance Flats||👉🏻 A housing sales exercise that encompasses unsold flats from past projects that are already underway or completed|
|SERS||Selective En Bloc Redevelopment||👉🏻 Procurement of flats before their 99-year lease is up for residential renewal |
👉🏻 Will receive compensation and relocation assistance in return
|TOP||Temporary Occupation||👉🏻 Permit that allows you to stay in a building temporarily, once sanitary and safety specs are met|
👉🏻 While waiting for a CSC
Before The Resale Flat
HDB recommends that you have an idea of a few things before you begin using the HDB resale portal:
✅ Know the kind of flat you’re after
✅ Know your budget (i.e. how much you’re willing to offer)
✅ Know the housing loans and grants you’re eligible for
🏡 Step 1: Registering Your ‘Intent to Buy’
👉🏻 Who: Everyone who intends to buy a resale flat — even if you’re planning to go through an agent. If you’re purchasing the flat with others, only one of you needs to register
👉🏻 How: You log in with your Singpass
👉🏻 Where: HDB’s Resale Portal
👉🏻 What: Instant assessment of your eligibility to buy a resale flat, as well as eligibility for any HDB housing grants and loans
👉🏻 When: Just be aware that it’ll only be valid for 12 months — and it needs to be valid when the sellers grant you an Option to Purchase (OTP) and during the submission of the resale application. So time it well!
👉🏻 Why: To kick start the entire process. After you register, you’ll be able to make an application for an HDB Loan Eligibility (HLE) letter — this letter is important to have around when sellers grant you the OTP during the next step.
🏡 Step 2: Get an OTP
Now that you’ve registered your intent, you may start looking for a suitable flat within your budget! After you’ve found the one and have come to an agreeable price with the sellers (check out the transacted prices for resale flats within the past 2 years here to get an idea) on the flat, they will grant you an OTP. This is basically a legal form of contract in the whole transactional process.
|Before Getting an OTP||You must have:|
✅ Registered your Intent to Buy
✅ Applied for an HLE if you intend to take an HDB housing loan
*The sellers can only grant you an OTP after you have obtained a valid HLE letter from HDB
|Before Entering the OTP||You and the seller must:|
✅ Declare the actual resale price of the flat to HDB
❌ Not enter into any other agreements or arrangements that may cause the true resale price as declared to be inflated or understated
👉🏻 Download form here
|When Sellers Grant OTP to You||🚨 You are not required to sign on the OTP yet |
✅ However, you will need to pay an Option Fee to the seller:
👉🏻 This is a negotiable sum that should fall between $1 to a maximum of $1,000
Implications of the Option Fee:
👉🏻 Once the seller has granted the OTP to you, he cannot grant another OTP to another buyer until the OTP granted to you has expired*
👉🏻 If anyone backs out, you’ll either have to forfeit (buyer) or refund (seller) the Option Fee
* OTPs last for 21 calendar days (including Saturdays, Sundays and Public Holidays) — from the date of granting the OTP till 4 pm on the 21st calendar day
* Value of flat will remain for three months from the day it is made available in the portal if you exercise OTP
🏡 Step 3: Choose Mode of Financing
Now that you’ve got a 21-day breather, it’s time to decide if you really want to buy a flat. It’s at this point that you’ve got to decide how you’ll be paying — cash, CPF savings, or a housing loan. If you’re going for a regular bank loan, remember to get a letter of offer from the bank before you exercise the OTP. Also, be sure to indicate this mode of financing in the HDB Resale Portal.
HDB recommends that you request for an assessment of the flat’s value during this time as well (this can be done via the portal) — if you’re planning to use your CPF or a housing loan, it’ll be required anyways.
👉🏻 It’ll take roughly 10 working days
👉🏻 HDB will inform you via email once the value of your flat is available in the HDB Resale Portal
👉🏻 Request for Value needs to be submitted together with a scanned copy of page 1 of the OTP
👉🏻 Submit it by the next working day after the Option Date
🚨 Do note that the evaluation will cost you a processing fee of S$120.
🏡 Step 4: Exercise OTP / Let OTP Expire
You’ve thought long and hard about this, it’s time to make a decision.
|Do It||Let It Burn|
|Things to Take Note Of||🚨 Must exercise OTP within 21 calendar day Option Period|
✅ You and co-buyers will now sign the OTP
✅ You will need to pay a deposit to the seller but remember that the total amount of Option Fee + negotiated deposit must not exceed S$5000
|🚨 Must wait for 21 calendar day Option Period to expire|
✅ You will forfeit Option Fee
🏡 Step 5: Submit Resale Flat Application
In essence, it’s now time for you and the seller to make a combined decision of when to submit the resale application to HDB — both portions need to be completed and submitted within seven days of each other. Find out what information you’ll need to provide here.
If the application is in order, both buyer and seller will be notified of HDB’s acceptance of the application via SMS or email within 14 working days and post updates of the application process on the portal. This marks the beginning of the 8 weeks processing time.
🚨 Do note that there will be a Resale Application Administration Fee that will range from S$40 to S$80.
🏡 Step 6: Acknowledge & Endorse Resale Documents
Hooray! You’re halfway through the process. At this point, there are four documents for you to endorse — the Buyer’s Financial Plan, CPF Withdrawal, Health Declaration Forms, and Resale Documents for Acknowledgement. We’ve compiled the stages in this step into a table:
|Stage 1||👉🏻 Compute your financial plan|
👉🏻 Prepare the documents for buyer and seller to endorse
✅ When documents are ready they’ll all be posted on the HDB Resale Portal, and you will receive an SMS to endorse the documents
|Stage 2||–||👉🏻 Endorse these documents within six days:|
(with 2 day grace period after a reminder SMS)
1. HDB’s proposed financial plan which you can make changes to on the HDB Resale Portal
→ Just endorse the revised financial plan after
2. CPF Withdrawal
→ After your endorsement, CPF Board will release the funds to pay for the flat
3. Health Declaration Forms for CPF Board’s Home Protection Insurance Scheme
→ To declare share of coverage and health status
4. Resale Documents for Acknowledgement
|Stage 3||✅ Direct you to HDB Resale Portal to make payments for the resale flat fees online|
👉🏻 These are legal fees that include conveyancing (for prepping documents), title search & other caveat fees including stamp duty fees
|✅ Pay via credit card or any other mobile payment apps|
🏡 Step 7: Approval & Resale Completion Appointment
We wait with bated breath for the approval — but the hard part is truly over. As a rule of thumb, the approval for the resale should be granted within two weeks after the seller and buyer have endorsed the documents.
You will be notified by SMS and email as usual. Plus, an approval letter will also be posted on the portal — so don’t worry about missing it!
Once you’ve gotten the OK, you’ll need to attend the Resale Completion Appointment.
Before this appointment, make sure that you:
✅ Have inspected the flat
✅ Bought fire insurance (it’s a requirement)
✅ Paid for the balance purchase of the flat and outstanding stamp fees
During the appointment, you’ll be:
✅ Signing the mortgage document (for HDB housing loan)
✅ Acknowledgement of receipt of keys to flat
✅ Apportioning payment of property tax with seller
✅ Indicating payment plan for first-month service/ conservancy charges
🎉 And just like that, you’ve become the official flat owner!
Furnish Your Dream Resale Flat With YouTrip!
Now begins the exciting part of crafting your nest — i.e. decking out your crimp in the best local, international, or Taobao furniture. If that scares you, don’t worry, we’ve got plenty of guides from Taobao, Amazon and everything in between to help you out.
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