How to Buy Condo Without Selling HDB in Singapore

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Many Singaporeans dream of moving from an HDB (Housing Development Board) flat to a private condo. This change signals their journey towards a better life and comfort. In a rich nation like ours, owning a home and living well matter a lot. Whether you’re buying property while owning an HDB, upgrading from HDB to private condo, or looking into financing options for a second property, this guide helps you. It explains how to buy a condo without selling your HDB in Singapore.

Key Takeaways

  • Know the eligibility and requirements to own more than one property in Singapore.
  • Learn about the Minimum Occupation Period (MOP) for HDB flats and who can live in them.
  • See the options for timeline planning to switch from HDB to a private condo.
  • Understand the financial effects of keeping your HDB while buying a condo. This includes the ABSD, CPF limits, and LTV ratios.
  • Find real estate investment strategies and buying second property advice in Singapore.

Eligibility and Requirements for Owning Multiple Properties

To upgrade from an HDB flat to a condo or landed property, you must meet certain conditions. You need to complete the Minimum Occupation Period (MOP) of your HDB flat first. This means living in your HDB flat for at least 5 years before moving to private property.

Minimum Occupation Period (MOP) for HDB Flat

The Singaporean government has a rule called the Minimum Occupation Period (MOP). It’s designed to ensure that HDB flats serve their main purpose, offering affordable homes to Singaporeans. To buy a private property, you have to meet the 5-year MOP for your HDB flat.

Citizenship Status and Restrictions

Your citizenship affects how many properties you can own in Singapore. Citizens can have two residential properties. Permanent Residents (PRs) are allowed just one. Foreigners are usually limited to one private property in Singapore.

Timeline Planning for Upgrading from HDB to Private Condo

When you plan to move from an HDB flat to a private condo, many factors come into play. Each way has its benefits and downsides. So, it’s crucial to think about the money and how practical your choices are before you commit.

Option 1: Keep HDB Flat and Buy Condo

One way is to keep your HDB flat and get a private condo as well. This lets you own two homes and earn rental income from the HDB. But, there are key points to think about:

  • You will need to pay a 20% Additional Buyer’s Stamp Duty (ABSD) on the condo purchase.
  • You will not be able to decouple your HDB flat, as it must be kept as your primary residence.
  • Your HDB flat is likely to depreciate over time as it ages.
  • The upfront capital outlay required for the condo purchase can be significant, especially if you have an outstanding HDB loan, as you can only take a 45% loan for the condo.

Option 2: Buy Condo First, Then Sell HDB

Here, you would buy the condo first and later sell the HDB flat. This method has its advantages:

  • You can avoid the 20% ABSD, as you are not considered a second-time property buyer.
  • You have the flexibility to sell your HDB flat at a time of your choosing, potentially maximizing the sale price.
  • You can use the proceeds from the HDB sale to reduce the financial burden of the condo purchase.

However, switching from the HDB to the condo might need some temporary living arrangements or storage solutions.

Option 3: Sell HDB First, Then Buy Condo

This plan involves selling your HDB flat first. Then, you’d buy the private condo with the sales money. This method offers its own benefits:

  • You can avoid the 20% ABSD, as you are not considered a second-time property buyer.
  • You have the choice to time the HDB sale and condo purchase to get the best deal.
  • You can use the HDB sale money for a big down payment on the condo. This can lower your loan amount and your monthly payments.

But, finding a place to stay between selling the HDB and buying the condo can be hard.

Option 4: Sell HDB and Buy Condo Concurrently

Another way is to sell your HDB flat and buy the condo at the same time. There are big pros to this method:

  • You can avoid the 20% ABSD, as you are not considered a second-time property buyer.
  • You can plan the timing of the sales and purchases to avoid needing a temporary home.
  • You can use the HDB sale money as a sizable down payment on the condo. This could mean lower loans and smaller monthly bills.

Yet, managing the process carefully and the timing is crucial to make the transition smooth.

Financial Implications of Keeping HDB While Buying Condo

Upgrading from an HDB to a condo comes with financial commitments. You should consider the Additional Buyer’s Stamp Duty (ABSD), CPF limits, and the LTV ratio for the second property.

Additional Buyer’s Stamp Duty (ABSD)

If you buy a second property and are a Singaporean, you pay a 12% ABSD on the new condo’s price. This extra cost is essential to know for your budget planning.

CPF Withdrawal Limits

For your second property, you can use only your CPF savings up to 100%. You might have to use your savings to pay the rest of the down payment and other fees.

Loan-to-Value (LTV) Ratio for Second Property

For your second property, you can get up to 45% support from a loan. This means you’ll need a lot of cash for the remaining 55%. This could be hard for those with a current HDB loan.

how to buy condo without selling hdb in singapore

Many dream of moving from an HDB flat to a condo in Singapore. But, it’s tricky to do if you want to keep your HDB. Luckily, there are ways to buy a condo without selling your HDB flat.

Keeping your HDB flat and getting a condo is one way. You can rent out your HDB flat and enjoy condo living. Yet, you must pay a 12% Additional Buyer’s Stamp Duty (ABSD) and can only get a loan for 45% of the condo’s cost.

Another idea is to purchase a condo first, then sell your HDB flat. This lets you buy a condo in Singapore’s current market without selling your HDB first. But, you must manage the sale and purchase well to avoid extra costs.

Choosing the right way to buy a condo without selling your HDB depends on you. Think about your money situation, future goals, and what you want. Talk to a real estate pro or financial advisor for help. They can guide you to make a choice that’s good for your future.

FAQ

What is the minimum occupation period (MOP) required for upgrading from an HDB flat to a private condo in Singapore?

To move from an HDB flat to a private condo in Singapore, live in your current HDB flat for at least 5 years. Then, you can think about upgrading.

Can I keep my HDB flat and buy a condo without selling the HDB?

Yes, you can keep your HDB and own a condo too. This lets you have two places, with the HDB flat bringing in rent. But you must pay 20% more in taxes and can’t separate the HDB from your spouse. The HDB may lose value over time, and buying a condo costs a lot.

What are the financing options for buying a condo while still owning an HDB flat?

If you owe money on your HDB, you can only borrow 45% for a condo. This makes it hard for many to get a condo while still paying for their HDB.

What are the different options for upgrading from an HDB flat to a private condo in Singapore?

To change from HDB to private condo, you have a few choices: 1. Own both the HDB and a condo. 2. Buy a condo first, then sell the HDB. 3. Sell your HDB and then buy a condo. 4. Do both at the same time.

What are the financial implications of keeping an HDB flat while buying a condo in Singapore?

The costs of having both an HDB and a condo include: – 20% more tax to the government. – Rules about how much CPF you can use to buy the condo. – If you’re still paying for the HDB, you can only borrow 45% for the condo.