Ask us in the comments below or on the chat icon on the bottom right of your screen! The MOP is the minimum number of years you need to have physically occupied your HDB flat before you can buy a private property or sell the HDB. Buying takes a lot less time than selling. Home » Blog » Guides & Insights » Upgrade from an HDB to a Condo: The Ultimate Guide – 2020 Update. . There is one crucial question to answer when it comes to upgrading from an HDB to a condo: Am I eligible to upgrade to a private property if I currently own an HDB? Since this is your second property and assuming it is also your second loan, this could have a huge impact on how much you can borrow per month and consequently, overall for your condo. RelocationWhen you are planning to relocate to another location, you need to consider selling your condo. Hence, we will share everything you need to know in terms of affordability to determine which one makes sense for you. The good news is if you have an apartment or condo you would like to sell fast we still want to buy it! BedsAny1+2+3+4+5+ Use exact match Bathrooms Any1+1.5+2+3+4+ Home TypeHouses Manufactured Condos/co-ops Multi-family Apartments Lots/Land Townhomes Max HOA Homeowners Association (HOA)HOA fees are monthly or annual charges that cover the … ), Price of a 55-sqm 2BR condominium unit = 138,000 * 55 = 7,590,000 PHP, Add another 435,000 PHP for the parking. If they buy a condo worth $1,000,000, the ABSD would be calculated as shown below: Property tax is payable on both properties – the one that you live in as well as the one that’s rented out, based on the “Annual Value” (AV) of the property. Therefore, just make sure that if you buy a new launch, it is because you like it and it fits your requirements, and not because it is being hard sold to you. If you were to take a loan for buying a condominium in Singapore, the maximum loan amount you can take is subject to TDSR restrictions, meaning that even if the LTV for your bank loan is high, the amount of money you can get as a loan depends on your income. Keeping the HDB you own as an investment property and upgrading to a condo definitely sounds tempting to many Singaporeans, especially if the rental income is close to or more than the mortgage payable every month. The MOP is the minimum number of years you need to have physically occupied your HDB flat before you can buy a private property or sell the HDB. You can find the details of your service and conservancy charges through your Town Council. Enjoy a cozy fireplace in the living room and a slider out to your serene private balcony! Below, you can find the property tax rate for a property that you own and occupy i.e. But since they are keeping it and have an outstanding loan which requires a payment of $1,000 per month, their maximum loan amount to buy a condo is $1,600. ( *Note: to calculate maximum property value based on maximum loan amount (mortgage) payable per month: At first glance, that represents a 16.4% yield ($9,000 divided by $55,000). If you’re not sure what the AV of the condo you intend to buy is, you can find it on IRAS’ site. It will rent for $750 per month ($9,000 per year). Let’s assume the same costs stated before for Mark and Josephine, in addition to a monthly mortgage payment of $1,000 for their existing HDB. If you buy a condo first. If this is your 3rd property or higher, check the ABSD rates here. Since you are keeping your HDB, if the block it is in becomes a part of an Upgrading Programme, you have to pay for it. For selling your HDB, an agent will typically charge you 2% of the HDB’s selling price (this is the standard market practice). 8. Our Condominium Professionals are ready to help you buy, sell or finance a condo today. from your CPF OA account for buying the second property. Below, you can find the property tax rate for a property that you own and occupy i.e. Hence, the ABSD Rate that applies is 12%. So how does this impact you? Third, calculate your affordability for buying a condo based on whether you want to keep or sell your HDB. Since your property “Holding Period” is at least 5 years, you do not have to pay any Seller’s Stamp Duty (SSD) (which is only applicable when selling properties with holding periods of 4 years or less). Assuming they only have enough money to make the downpayment, the maximum property value will be $426,135. + Additional Buyer’s Stamp Duty (ABSD) If you are using HDB lawyers for your sale, you can estimate the legal fee using the. The rates are based on how many housing loans you have at the time of applying for the condo loan. 1. Assuming they only have enough money to make the downpayment, the maximum value of the condo they can buy is, If they are older and only qualify for an 8 year loan tenure based on their IWAA calculated above, they can get a maximum principal loan amount of ~, , meaning the maximum value of the condo will be. Summary: side by side comparison between selling and keeping the HDB. However, if you sell your HDB flat within 6 months of buying the condo, you are eligible to apply for a remission (provided either you or your spouse is a Singapore Citizen). If you were to take a loan for buying a condominium in Singapore, the maximum loan amount you can take is subject to TDSR restrictions, meaning that even if the LTV for your bank loan is high, the amount of money you can get as a loan depends on your income. What are the steps to upgrade from an HDB to a condo? If you’ve already paid off the loan on your HDB flat, it doesn’t matter whether you sell the HDB first or buy a condo first. Now you can save more when you buy or sell! Ah, the thorn on every 2nd home buyer’s side – Additional Buyer’s Stamp Duty (ABSD). The Upgrading Programme is conducted by HDB to improve the facilities in certain older HDBs, such as adding lifts or implementing maintenance work. Furthermore, when buying your condo, you will be allowed to withdraw upto 120% of the Valuation Limit of the condo (Valuation Limit is the lower of your condo’s market value and purchase price) instead of 100%. Some condominiums are underfunded and don't have the money to pay for regular maintenance. Let’s not beat around the bush, this is clickbait. Whether you're looking to buy a home in Dallas, sell a Dallas condo or town home, or rent an urban loft in Downtown Dallas, we've got you covered! You must pay the service and conservancy charges for your HDB flat up to the HDB sale completion appointment date. If you’re selling your HDB before buying a condo, the entire process is more straightforward for you. So how does this impact you? We will calculate the affordability based on upfront cash/CPF outlay needed to determine whether it is feasible, using the formula below: Mark and Josephine want to buy that $1,000,000 condominium without selling their HDB, and want to determine the upfront cash/CPF needed to be able to do so. If you’re renting the HDB instead of selling, the process is a lot more straightforward. We know the best tips and tricks to get the property you want. The “principal loan amount” i.e. To calculate your affordability, you can use the formula below: Affordability = Banks use an interest rate of 3.5% to calculate maximum loan amount due to MSR regulations, to ensure that the borrower is able to pay it off even if the interest rates spike.). Condo owners in Los Angeles County, though, can sell a condo in from 84 days to 100 days as of October 2012. – Outstanding HDB Loan Amount Upfront Cash/CPF Needed = Can I afford to keep my HDB and upgrade to a condo? Keeping these in mind, resale condos may be a safer bet for several buyers due to the certainty and knowledge of knowing what you’re getting. to calculate maximum property value based on maximum loan amount (mortgage) payable per month: Total Loan Payment = Maximum Monthly Mortgage Payable x Loan Tenure x 12, Principal Loan Amount = excel formula “ = PV ( Interest/12, Loan Tenure x 12, Maximum Monthly Mortgage Payable) ”, Maximum Property Value = Principal Loan Amount / 75%, Banks use an interest rate of 3.5% to calculate maximum loan amount due to MSR regulations, to ensure that the borrower is able to pay it off even if the interest rates spike. Service and Conservancy Charges are charges for the maintenance of the common facilities in your HDB block. By the end of the article, you can determine that for yourself. Search by size, use our custom deal meter, receive listing notifications & view past sales data. Due to this, some restrictions apply on the amount of CPF you can withdraw for the purchase. The “principal loan amount” i.e. Find out everything there is to know about Additional Buyer’s Stamp Duty (ABSD) here. Below, we list all the implications of keeping your HDB and buying a private property in Singapore. This minimum amount to be set aside is stated on. on the withdrawal amount based on the condo’s remaining lease still applies. – Buyer’s Stamp Duty (BSD) What are the steps to upgrade from an HDB to a condo? As mentioned before, the definition of “Upgrading” here is different from that in the rest of the article. Find out everything to know about, If you sell your HDB flat first, you do not have to pay any ABSD. There are two important differences when buying a new launch vs a resale condo. These are the most common reasons we get apartment or condo sellers calling us to sell their properties fast. 7. Is the building currently under litigation? Josephine and Mark’s “couple age” or their Income Weighted Average Age (IWAA) is based on their combined income and age as shown below: Hence, even if the loan amount they are eligible for is higher, their time to pay it off is much shorter, thus increasing the amount they need to pay per month. Considering that you are an HDB owner, you already know how Property Tax works. And finally, start with the action steps for selling/renting and buying. Single-Family Homes Sell Faster Than Condos—And at Higher Prices A typical single-family home was $58,000, or 17.3%, more expensive than a typical condo … Service and Conservancy Charges are charges for the maintenance of the common facilities in your HDB block. Fifth, decide if you would like to proceed with a resale condo or a new launch, with clear reasons in your mind. so we can help you through the process of checking this. Need to wait a few years until it is ready to be lived in, Paying mortgage on condo as well as HDB without any rental income for a few years, Can move into condo and sell or rent out HDB immediately, Cannot gauge potential issues with the unit from before (such as loud noise from upstairs neighbour), Can gauge potential issues before buying, with a thorough inspection, Purchase price will almost always be close to fair market value, Purchase price can go below the real property value based on some sellers’ reasons (such as moving out of the country), Riskier due to a larger number of unknowns, Less risky due to greater control and knowledge of what you’re purchasing, Brand new furnishing, flooring and fittings, Can have fewer and more worn down facilities, Lower maintenance costs since it is brand new, Higher maintenance costs as the condo gets older, No such discount, in case there is no seller looking to sell below market value, Can choose unit on your preferred floor, facing and feng shui, Can only buy from what’s available for sale. 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