Singapore: Guide to Buying Costs and Procedures

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Roundtrip buying costs in Singapore can reach 6.45%

How high are realtors’ and lawyers’ fees in Singapore? What about other property purchase costs?

Process of buying property

Since July 19, 2005, under the Residential Property Act, foreigners can now buy apartments in buildings of less than six stories without prior government approval. However, foreigners still cannot purchase vacant land and landed properties without permission from the Singapore Land Authority. Non-residential property is not subject to these ownership restrictions.

Aside from these restrictions, foreigners can buy condominiums freely. There are few foreign exchange restrictions, and non-residents can now borrow up to 80% of the property cost locally, in Singapore Dollars.

When a price has been agreed, it is normal to obtain the ‘Option to Purchase’, giving the buyer sole right to the property for a limited period, usually two weeks, for an option fee, usually 1% of the purchase price. The terms of the option will become the terms of a binding contract, so a lawyer’s advice is advisable.

To confirm intention to buy, another sum, usually 9% of the purchase price, on top of the option fee, must be paid to the seller within the time period stated in the option. The payment is forwarded to the seller together with the signed option. Contracts for sale generally follow the standard terms embodied in The Law Society's Conditions of Sale 1994.

The lawyer will:

1. Draw up the option;
2. do a title search to confirm details of the property and its ownership;
3. check that the owner is not a bankrupt;
4. check with the relevant government authorities to ensure that the property is not affected by any government notices or projects, e.g. road widening, construction of MRT lines, etc;
5. prepare the documents transferring title of the property;
6. prepare an account and advise on the amount which needs to be paid to complete the purchase.

On the completion date, the lawyer will arrange for the payment, in exchange for documents transferring the title.

Footnotes to Transaction Costs Table

The round trip transaction costs include all costs of buying and then re-selling a property – lawyers’ fees, notaries’ fees, registration fees, taxes, agents’ fees, etc.

Stamp Duty:
18% VAT is imposed on the sale of newly built real estate (or for properties sold within one year of construction or reconstruction), but is exempt on used real estate.

Legal Fees:
Following the abolition of scale fees in February 1, 2003, fees are now negotiable. The Council of Law Society sets fee guidelines for conveyancing transactions to meet the "fair and reasonable" criteria of the law.

For non-CPF Conveyancing Transactions:

Seller: 0.15% of sale price for transactions not exceeding SG$2 million, subject to a minimum fee of SG$900, for the case where the sale price/sale consideration does not exceed SG$2 million.

Buyer: 0.3% of sale price for transactions not exceeding SG$2 million, subject to a min fee of SG$1,800, for the case where the purchase price/ purchase consideration does not exceed SG$2 million.

Registration Fee:
Lodge transfer at Singapore Land Authority

Real Estate Agent's Fee:
Seller: Minimum of 2% of contracted price as sales commission
Buyer: 1% of contracted price as finder's/ service fee

Singapore - more data and information

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