The reality here in Singapore is that condos have shrinking sizes and rising prices. Despite this, it is still a highly sought after investment, especially for young professionals. There are many properties that you can consider but before buying a condo, you have to know about the MOP (Minimum Occupation Period). MOP refers to a minimum period of 5 years before you can actually sell the unit.
Knowing this, you have to put careful thought when choosing. The prudent thing to do is to look for a real estate agent to help find a good unit. You can start by going through the Council of Estate Agents, which is a governing body for all property agents in Singapore. Apart from the real estate agent, you need to hire a lawyer for professional guidance. If you take a bank loan, the bank will assign one to you.
Here are other things that you should consider when securing a condo unit:
Picking a property
As soon as you organised your team, it is time to pick a property. You have to be aware that new condos are smaller than four-room HDB flats. If this is okay with you, you can check out many new launches and developments. If you prefer somewhere in Upper Bukit Timah, you can start with Mayfair Modern Oxley Holdings. If you prefer to have more living space, you should consider older condos. Older condos tend to have larger living spaces.
After identifying the property, the next move is to “hold” it. Here in Singapore, you can “hold” the unit for 2 weeks. This is to ensure that no other buyers can view it. This involves an option fee of 1%. Within a month, it is important that you secure your financing and then pay the 2nd option fee, which is usually 4% and then 15% down payment.
The bank will loan the rest of the amount to you. Aside from the mortgage, there is TDSR (Total Debt Servicing Ratio), which means you spend a maximum of 60% of your monthly income on repaying the debts. The mortgage could take 30 years depending on your loan or fixed monthly amount.
After the mortgage and the TDSR, you need to consider other additional fees like the BSD (Buyer’s Stamp Duty). This means paying 1% stamp duty on the first $180,000 of the price.
Learning final fees
The next thing that you have to do is to settle your agent and legal fees. If you bought a resale unit, the seller will usually pay the agent. If you bought a new condo, the developer will pay the agent. You need to pay for legal fees excluding the SLA (Singapore Land Authority) mortgage duty and the IRAS (Inland Revenue Authority of Singapore). You can spend another $2,500 for legal fees.
Collect or wait for keys
If you finished all the paperwork and the payments, it is a matter of waiting or collecting for keys. If you bought a unit in a development that will complete the TOP (Temporary Occupation Permit), you can collect the keys and move in immediately. If you bought a unit in a new development, you need to wait for two years or more before it is actually ready for occupation.