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Your All-In-One Guide to Buying Property in Singapore as a Foreigner



Popularly known as Asia’s financial heart, Singapore’s reputability is on another level amongst the expats who want to find a home away from their own home. Even though it is one of the most big-budget places in the world to live, fitting foreigners do not lag behind to grab the chance for settling down or longer stays in this global city of a vigorous community.

Before stepping onto the platform to buy a property in Singapore, many questions must pop up in one’s mind, and it is really important to have a clear conception about it. So, for those who want to learn about the options you will come across dealing with Singapore’s property market as a foreigner, this article is for you.

Can foreigners buy property in Singapore?

In brief, yes, foreigners can buy property in Singapore.

According to the definition provided by the Singapore Land Authority (SLA), a person is considered a foreigner if he/she is not a Singaporean citizen or any of his/her entities not incorporated in Singapore. However, the Residential Property Act of 2005 indicates some restrictions in place.

The limitations of foreigners for buying properties are:

●      They can only buy apartments in buildings of less than six stories.

●      If they want to live in a higher level of a building, they need to get government approval.

●      For purchasing vacant land, they need to get approval from the Singapore Land Authority is required.

What properties can non-Singaporeean Permanent Residents buy?

●      Private condos

●      Private ECs

●      Landed properties in Sentosa Cove

●      Landed properties (with special permission from Singapore Land Authority)

Permitted age to buy a property in Singapore?

●      at least 21 years old.

●      If parents want to purchase property for their children, they can do it although the child will become the legal owner only when he/she turns 21.

The step-by-step process when buying a house in Singapore


When you decide to buy a property in Singapore, you will need to follow the steps below.

Step #1 Find a real estate agent and lawyer

First and foremost, all you need to do is find a real estate agent. An agent will help you to have a smoother ride by getting most of your work done. They will find the best deal for you, do your financial calculations, settle your paperwork, and more. On the other hand, a lawyer will help you finish your legal essentials.


Step #2 Check on what is on the market

Before you decide what you want to purchase, with the help of the agent, you need to check on the properties that the market is offering at recent times – both online and offline. It will make a way for you to find a suitable house within your budget.

There are many property management companies to help you in this step. When you will find a suitable property, make an appointment and visit the property.


Step #3 Set the price with the seller

In general, owners tend to list their properties at a higher price than they are willing to accept. So, before offering a price, do your research on past transactions of similar properties in the area you are looking at. Now, this is the time to negotiate!


Step #4 Get a good home loan

If you are not planning to pay entirely in cash or CPF savings, at this stage, you will need to secure a good bank loan for the payment of your purchase.


Step #5 Secure the Option to Purchase (OTP)

Make sure to secure the Option to Purchase (OTP) by paying a 1% down payment of the purchase price. It secures the property for a couple of weeks. Later on, the lawyer will draft the terms and conditions from this option to the actual deed.


Step #6 Pay the remainder

The next step is to pay the rest of the 9% down payment to confirm the intention to buy. This should be done within the timeline agreed in the OTP agreement.


Step #7 Complete your purchase

Now it is time for the lawyer to formulate the option, confirm the property ownership and legal arrangement for the property to be sold. Then, the documents, which are signed by both buyer and seller, will be prepared to transfer the title of the property. Lastly, the sale will be ensured to be registered properly, and the purchase is completed.

You can now spend time in your new home in Singapore!

Property purchase costs in Singapore

The price of the properties in Singapore is greatly influenced by the areas. It varies from area to area. If you want to live a city centred life, it will be a bit costlier than the other areas since you will be provided with more amenities here.

You will get to see housing stock at a wide range of sizes and levels of luxury.


According to Global Property Guide –

“Singapore's housing market remains healthy, despite a struggling economy caused by the COVID-19 pandemic. The private residential property index rose by 2.21% during 2020, following y-o-y rises of 2.67% in 2019, 7.85% in 2018, and 1.09% in 2017, according to the Urban Redevelopment Authority (URA). When adjusted for inflation, house prices rose by 2.16% y-o-y last year.

During the latest quarter (i.e. q-o-q in Q4 2020), residential property prices increased 2.08% (1.67% inflation-adjusted).”


Please note: It is important to consider all the taxes and fees while looking for the total cost of buying a house in Singapore because they can add up from 7% - 20% of the buying prices.

Property prices and rental yields in Singapore

Calculating the rental yield is important since it gives you an idea of how much rental income you can get from a property. It is calculated in relation to the property price. The rental yield is very much dependent on location and demand for rental units.


How would you calculate rental yield?

There are two ways to find out rental yields –

●      Gross rental yield

●      Net rental yield.


Gross rental yield is the yield that is found out in relation to the property purchase price.

Gross Rental Yield = (Annual Rental Income / Property Purchase Price) x 100


Net rental yield is the yield that is found out in relation to the property buying price plus all other expenses. It is considered more accurate since it takes all the additional costs of maintenance, rental and taxes into consideration.

Net Rental Yield = (Annual Rental Income / [Property Purchase Price + Renovation / Maintenance Cost + Taxes + Interest Cost]) x 100


However, usually, the gross rental yield is reported as the rental yield because the net rental yield will vary with the additional costs.


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