**How Much Singles Need To Save Every Month To Buy Their Dream Condo In Singapore**

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Are you a single bachelor in Singapore wanting to buy your very first condominium? You better get ready to skimp and save for the next 5 years of your life!

Buying a condo in Singapore as a bachelor is like playing a long-drawn-out game of chess.

It involves years and years of patiently saving your money just so you can get that checkmate in the end.

If you’re a bachelor under the age of 35, chances are you’re either still living with your parents or living on rent, but of course, it’s not going to be this way forever.

You’ll soon find your significant other, get married, have kids, and go through the whole nine yards.

However, before that can happen, you need to be ready for life with your very own home.

Whether you’re a lady or a gentleman, it helps, in the long run, to have a secure home to call your own.

But the truth of the matter is, most people can’t afford to buy their own private condo, and that’s especially true in the case of bachelors.

HDB flats are considerably cheaper, but they aren’t available to people under the age of 35, so you’re essentially left with private properties such as a private condo or a resale flat.

You can obviously wait until you are 35 years old just to get a shot at buying an HBD flat.

Either way, it’s important to note that flat types and lease tenures also affect the cost; a 99-years lease property will cost more than a 45-years lease property.

If you have a deposit fee, then the balance purchase price will be determined after deducting the deposit amount.

Also, buying the flat with someone else as joint tenants can also help mitigate the overall cost of the property.

If your partner has already bought a flat before, he/she might even be able to play for a resale levy.

Buying any kind of private property in Singapore comes with a purchase price of at least $ 800,000 to $ 1 million, and that’s just on the lower end of the price spectrum.

However, this price range is not something you would find on the more luxurious side of town.

If you really want to try your luck buying private condominiums or executive condos in the prime localities of Singapore, you’ll be looking at flat prices between $ 1.4 to $1.6 million.

But this would dig an even bigger hole in your bank account and perhaps even leave you bankrupt.

By now, you must have already realised that buying a private condo in Singapore as a bachelor on an average monthly income is not a piece of cake.

But don’t lose heart; there is a way to get there and own your dream condo despite the humongous flat costs.

This article will provide a step-by-step guide on how to save money and manage your expenses so that you can purchase your very first condo as a bachelor in Singapore.

**How Much Do I Need To Save/Earn?**

At least this much is understood that buying a private property in Singapore as a single person will require you to spend a tremendous amount of money.

That means that you have to start saving the moment you start earning; otherwise, you’re already behind the curve.

There’s no point in becoming signing up for the flat applications if you can’t even afford a flat purchase, right?

Just to give you some insight on how much you need to save to buy a private property, let’s take the example of a unit that costs around $ 998,000 after.

In order to be eligible to buy this unit, you’d have to start off by coming up with a 25 % downpayment of at least $ 247,000, give or take.

This 25 % can be further split into three portions; 15 % CPF amounting to $ 148,000, 5 % booking fee amounting to $ 49,000 in cash, and 5 % payment after loan disbursement ate the foundation stage amounting to $ 49,400.

Since this will be your first property, you won’t have to pay the additional buyer’s stamp duty.

You will, however, have to pay for the buyer’s stamp duty amounting to $ 24,240.

The payment for BSD can be made via the ordinary CPF account; however, in this explanatory scenario, we will be adding that as part of the cash payments you have to make initially.

So far, this leaves us at $ 73,640 of cash payments and around $ 197,600 in CPF payments for now.

Now, let’s assume that you are in your early twenties and just started a job that pays you a salary of $ 3500, which would mean that your annual income will come up to $ 42,000.

If you somehow manage to save $ 1000 a month, you would end up saving $ 12,000 a year.

So, in order to come up with the initial $ 73,640 needed for cash payments, you would need to save for at least 6 years.

However, the problem arises when it comes to your CPF; after 6 years at a steady rate of 23 % contribution to your CPF, you would only have saved $ 57,960.

Since the CPF fee needed for your home is around $ 197,600, you will have $ 139,640 less than what you need.

If you somehow continue on with your savings for the next 7 years, you will have saved an extra $ 84,000 in cash and $ 67,620 in CPF funds, which would bring you to the required amount needed for the initial costs.

And let’s not forget, you still have to pay for the conveyancing fees will probably cost you between $ 2000 to $ 6000.

Needless to say, that’s a lot to take in.

The above explanation was based on a condo that costs $ 998,000 in order to give a clear example of how much you would need to save.

Now, let’s go about this in a more general way and see how good your saving game would have to be in general.

You might want to go for an executive condo for a lower price tag, but you could also check out some great new launch condos in the market.

Alternatively, you could look for a decent resale flat from the resale market for a more affordable option, giving you the advantage of a lower downpayment rate of 20 %.

However, for the sake of explanation, we’ll go by the assumption that you are pursuing a new launch condo.

Whatever you choose, you will have to apply for a private bank loan In order to afford the property purchase, that is, unless you’re one of those crazy rich Asians.

As we aren’t talking about public housing here, you won’t have the option to take a loan from HBD, so you’ll have to apply for a home loan from the bank instead.

The key to getting your desired housing loan depends on whether or not you can spend 55 % of your monthly income on monthly installments to pay off the loan, as per the current Total debt servicing ratio rate.

Rather than going to the bank repeatedly, you can check your email notifications to see whether or not you’ve qualified for the loan amount you wanted.

Other than the monthly payments for your loan, you have to be able to afford the 25 % downpayment on your property, 5 % of which has to be in cash.

So, before you even attempt to go through with this, you have to do your research and figure out how to save the amount you need.

While there is no specific formula to doing this, there are a few steps that you can implement to reach your goal.

**1.Figure Out The Loan Quantum**

The first step is to determine how much you want to borrow from the bank.

According to the rules, the highest amount you can borrow is 75 % of the property’s purchase price.

If that is the amount you want, then you only need to put in 25 % as a downpayment.

Alternatively, if you want to borrow a lower amount, say, 55 %, you’ll have to save up 45 % of the property price.

So, if you’re looking to buy a $ 1 million condo at a loan quantum of 75 %, you’d need to have saved at least $ 250,000 to afford the downpayment.

On the other hand, if your desired loan quantum is 55 %, you’d need to save a tremendous downpayment of $ 450,000.

Similarly, buying a $ 2 million condo at a loan quantum of 75 % means you need to have at least $ 500,000 in your bank account.

If the loan quantum is 55 %, then you’d have to save up a mammoth amount of $ 900,000, which is almost 1 million.

**Figure Out Your Monthly Costs**

This is an important step in determining the loan affordability factor when attempting a flat purchase.

According to the bank home loan structure, you will have to dedicate a certain amount each month for installment payments on your loan.

This amount will vary from loan to loan, depending on the different loan rates allotted by the bank.

You should calculate how much you would need to spend each month based on the amount you want to borrow, the rate of interest, and the loan tenure you want.

The maximum income limit valid for a loan does not exceed $ 14,000 for first-time buyers.

If you’re not good at mathematics, don’t worry, most banks have a loan calculator on their website.

Use it to determine how much you would need to spend each month, depending on the various loan rates.

Let’s use an example and say you’re attempting to get a loan tenure of 25 years at 1.6 % interest per annum.

Assuming that the condo costs $ 1 million and you’ve borrowed a loan amount of $ 750,000 (75 %), your monthly repayment amount will be $ 3,035.

If the price is $ 1.5 million, your monthly installment will be $ 4,552; if the price is $ 2 million, your monthly installment will be $ 6,070.

**Figure Out Your TDSR**

Once you figure out how much of your monthly income you can spend on repaying the home loan, you will understand your TDSR limit.

Then, you can calculate how much you would need to earn to afford the loan.

To explain this better, we will be factoring in 60 % TDSR, assuming that you don’t have any other debt obligations.

So, let’s say the condo is priced at $ 1 million, and you’ve taken a loan of $ 750,000 with a monthly installment of $ 3,035 for repayment, at an interest of 1.6 % p.a for a loan tenure of 25 years.

Based on the 60 % TDSR limit, you will need to earn $ 5,058 every month to afford the loan.

Alternatively, let’s say you take $ 1.5 million at monthly repayment installments of $ 6,070 at 1.6 % p.a interest for a loan tenure of 25 years to buy a $ 2 million condo.

Based on the 60 % TDSR limit, you will need to earn $ 10,117 every month to afford the loan.

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**How Much Does It Cost To Buy A Home In Singapore?**

Property prices vary depending on the size of the property, how many rooms there are, and the property type.

Starting with the smallest, we have one-bedroom studio apartments, which can either be executive or private condos.

A one-bedroom executive condo costs between $ 420,000 to $ 560,000, while a one-bedroom private condo can cost around $ 600,000 to $ 700,000.

A 2-Room Flexi executive condo will cost around $640,000 to $720,000, while a 2-bedroom private condo will cost around $800,000 to $900,000.

Regarding 2-Room Flexi flats, the HDB 2-room Flexi flats will come at a cheaper cost than the private or exec version.

A 2-Room Flexi HDB BTO with a non-mature estate will cost you around $90,000 to $162,000, while a 2-room Flexi HDB BTO Flat with a mature estate will cost around $137,000 to $277,000.

Coming to three-room HDB BTO flats, a non-mature estate will cost around $164,000 to $248,000 while a mature estate will cost $205,000 to $421,000.

On the other hand, three-bedroom resale flats will cost somewhere between $350,000 to $380,000.

Three-bedroom executive condos will cost $776,000 to $960,000 while three-bedroom private condos will cost around $970,000 to $1.2m.

The price of a 4-Room HDB flat varies from age to age, with mature estates costing $311,000 to $617,000 and non-mature estates around $253,000 to $381,000.

A 4 bedroom resale flat costs $420,000 to $550,000, while an exec condo will cost $1.12m to $1.4m, and a private condo can cost around $1.4m to $1.8m.

The valuation price of a five-bedroom HBD non-mature BTO flat is around $405,000 to $516,000, while a mature estate will be around $423,000 to $725,000.

A five-bedroom resale flat can cost around $520,000 to $700,000, while an exec condo will cost $1.6m to $1.76m, and a private condo around $2m to $2.2m.

**How Can I Possibly Afford That?!**

Before you get freaked out by the tremendous cost of housing in Singapore, take a deep breath and calm down.

We know that most people won’t be able to pay a crazy amount such as a million dollars at one go, and luckily for you, you won’t have to.

That’s what loans and downpayment are for!

So instead of giving up, you can come up with a strategy to afford the downpayment, the monthly installments on the mortgage, and any other expenses that might be attached.

As long as you manage to do that, the dream condo will be as good as yours.

**Calculate The Downpayment**

The downpayment amount you have to pay will depend on your loan-to-value ratio.

Let’s say that you want to buy a $ 1 million condo, and you get the highest L.TV ratio of 75% on your loan.

That means you will only have to pay $ 25,000 for the initial downpayment, out of which $ 5000 has to be in cash, and the remaining $ 20,000 can be paid via your CPF Ordinary Account.

However, getting a 75 % LTV is not always possible and can only be achieved if you have an impeccable credit score.

The LTV can be extremely low depending on how reliable the bank finds you, which would mean you’d have to pay a higher downpayment.

So in order to make the downpayment more affordable, you should try to get the best LTV score possible.

And, of course, you will have to meet the eligible household income ceiling for your loan application to be accepted.

**Calculate The Monthly Installments**

The next step is to ensure that you can afford the monthly installments for the loan repayment.

Depending on how much your TDSR is, there will be a specific amount you have to pay.

Since this is your initial housing loan, there won’t be any other mortgage payments that you have to make.

Figure out how much TDSR you are aiming for, which should give you the specific amount you need to pay for the monthly installments.

Given the maximum TDSR rate of 55 %, you can’t pay more than 55 % of your monthly income to pay off your loans.

For example, let’s say you want to buy a $ 2 million condo and apply for a loan amount of $ 1.5 million.

Assuming that your interest is 1.6 % per annum for a loan tenure of 25 years, you will have to pay $ 6,070 monthly from your salary.

**Calculate The Miscellaneous Expenses**

Finally, you should consider the various expenses involved, such as conveyancing fees, any property agent fees, and the stamp duty payable.

A decent conveyancing lawyer should cost around $2000 for the transfer of property or $ 5000 for something big like a land sale.

The BSD, on the other hand, will be calculated on the applicable rates, i.e., 1 % of the first $ 180,000, 2 % of the next $ 180,000, 3 % of the next $ 640,000, and 4 % of the remaining amount.

If you are a Singapore citizen, you won’t have to pay the ABSD on your first property purchase.

However, you will have to pay 5 % ABSD tax on the property price if you are a Singapore permanent resident.

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**What Are The Interest Fees?**

There are a few banks that provide the best interest rates for home loans that have a fixed-rate on private properties.

What’s more, these interest rates are actually around 20 % lower than the average rate on the market.

Assuming that you have a mortgage of $ 500,00, these rates can essentially save around $ 30,000 for you during your 25-year loan tenure.

DBS Bank and SBI Singapore provide an interest rate of 2.75 % in the first year with a lock-in period of 2 years.

With this rate, your monthly installment payment on your mortgage will be $ 2,307, which is quite a low amount.

HSBC proves an interest rate of 2.65% in the first year with a 2-year lock-in period.

Your monthly mortgage payment with this rate will be $2,281, which is still quite affordable.

HSBC Greenmark provides an interest of 2.55 % on the first year with a 2-year lock-in period, making your monthly installment amount $ 2,256.

In Singapore, a fixed-rate home loan will usually have a fixed interest rate for the first 3 to 5 years.

After this fixed period, the interest rate will become a ‘floating’ rate.

The following banks below give the best floating interest rates in the market.

SCB 3M SORA bank gives an interest of 1.57% on the first year with a lock-in period of 1 year, which means your monthly installment will be $2,017.

HSBC Greenmark SORA provides an interest rate of 1.67% for the first year with a 2-year lock-in; the monthly installment will be $2,041.

OCBC 3 M SORA bank provides a floating interest rate of 1.72 % in the first year, making your monthly installment requirements $ 2,053.

RHB 3M SORA gives an interest of 1.77% in the first year with a 2-year lock-in period; the monthly installment will amount to $2,065.

DBS 3M SORA will have a 1.82 % interest rate in the first year with a 2-year lock-in period; your monthly installment will be $ 2,077.

**How Much Is The Initial Payment?**

The initial payment made while buying a property is an accumulation of the option fee, stamp duty fees, downpayment, fees for property agents and conveyancing law firms, and any other miscellaneous expenses.

**Option Fee**

The option fee is 5 % of the total cost of the property in the case of a private condo or executive condo.

In the case of a resale EC or a private resale property, 1 % will be spent on getting the option to purchase, and the remaining 4 % will be paid on exercising it.

When it comes to HBD flats, the option fee differs from type to type and status of lease commencement.

An HBD resale flat will have an option fee of up to $ 5000, consisting of $ 1000 to be paid before signing the OTP and $ 4000 after exercising it.

Meanwhile, the option fees for a new 2-room and new 3-room HBD flats are $ 500 and $ 1000 respectively.

Finally, the option fees for new 4 room and 5 room, or executive flats will cost $ 2000.

**Downpayment**

The total amount you have to put down as the downpayment depends on the property price and the LTV ratio.

Simply put, a higher LTV ratio will mean that you have to pay a smaller downpayment amount and vice versa.

Usually, the LTV is determined by the income of applicants looking to secure a loan.

What’s more, any variable income sources such as rental or retirement income can also affect your LTV ratio.

This initial downpayment is made via a direct payment in cash or from your CPF account.

If you are buying an HBD flat, you have the option to use HDB Housing Grants or half housing grants.

Similarly, you can also use a family Grant to mitigate some of the total cost of the property; be sure to know the exact grant amounts.

The downpayment amount for an HBD flat or resale flat loan will be 15 % (inclusive of the booking fee) of the purchase price.

The downpayment for any private loans, such as loans for ECs, will come at a minimum cash payment of 5 % (for 75% LTV) or 10 % (for 55% LTV), assuming that you have no other home loans.

If it is your second or third housing loan, the minimum cash downpayment will be fixed at 25 %, while the rest can be paid using your CPF or cash.

**Miscellaneous Costs**

This can include any fees you have to pay to your lawyers, property agents, and conveyancing lawyers.

You will also have to pay stamp duty fees, Caveat registration fees, any amount for future home loan installments, insurance costs, etc.

**Is It Worth Buying A Condo In Singapore?**

Although it might cost you a ton, we can confidently say that buying a condo in Singapore is definitely worth spending all that dough on.

Condos are pretty expensive and will only grow more valuable over time, making them great pieces of real estate investment.

The median prices of condos in Singapore have always appreciated in value over time and will continue to do so in the near future.

So although buying million-dollar flats might seem too overbearing now, just think about how much you can sell them off for or how much you can earn by renting them out.

**Eligibility Versus Affordability **

Most people think that eligibility and affordability mean the same; however, it is not so.

You should remember that just because you are eligible to take a certain loan doesn’t mean you can afford it.

The mortgage servicing ratio dictates that you should not spend more than 30 % of your monthly income on your loan repayments.

This limit is set so that you don’t spend too much and financially burden yourself.

You might be able to afford to pay the required amount, but you have to also consider the ramifications of doing so.

Overexerting your finances just to pay off your loan while skimping down on the cost of your daily necessities is not the way to go.

It might sound like a good idea on paper, but it’s a whole different feeling once applied.

**How Much Is The Condo Downpayment In Singapore For First-Timers?**

How much you have to pay for the downpayment depends on the LTV, the stamp duties, the minimum cash payment, and the outstanding downpayment.

The outstanding downpayment can be paid either in cash or from your CPF account.

On the other hand, the stamp duties must be paid in cash at first, but you can request a reimbursement from your CPF fund later.

Note that the reimbursement will depend on certain refund conditions or remission conditions.

Let’s assume that you are a Singaporean Citizen buying your first condo at a price of $ 800,000 with the highest LTV ratio rate of 75 %.

Singaporean citizens will have to pay $ 200,000 outstanding condo downpayment and BSD of $ 18,600, totaling an amount of $ 218,600.

So, the amount of cash you should have in hand is around $ 58,600.

If you are a permanent resident, you’ll have to pay ABSD along with the BSD, which makes the total stamp duty amount to $ 58,600.

The total outstanding downpayment will then be $ 258,600, and the cash in hand you should have will be $ 98,600.

If you’re a foreigner, your total stamp duties fees will shoot up to $ 258,600, making your total downpayment $458,600.

**What Factors Affect The Cost Of A Condo In Singapore?**

**Buyer’s Stamp Duty**

This is something you have to pay regardless of whether or not it is your first property purchase.

The BSD is calculated at 1 % of the first $ 180,000, 2 % of the second $ 180,000, 3 % of the third $ 640,000, and if the property price is more than a million dollars, 4 % of the remaining amount.

So, if you want to buy a condo costing $ 1 million, BSD will cost you $ 1800 on the first $ 180,000, $ 3600 on the second $ 180,000, and $ 19,200 on the remaining $ 640,000.

This will add $ 24,600 on top of the 1 $ million purchase price of the property you want to buy.

**Additional Buyer’s Stamp Duty**

If you are a Singapore citizen, you won’t have to pay ABSD on your first property purchase.

However, you will have to pay ABSD at the rates of 12 % on the second property and 15 % on the third property.

So, your second property, valued at $ 1 million, will increase in price by $ 120,000. And your third property will increase by $ 150,000.

If you are a permanent resident, you will have to pay 5 % ABSD on your first and 15 % on your second and subsequent properties.

This will increase your first property price from $ 1 million to $ 1 million 50 thousand.

Your second property will also have an extra $ 150,000 added on top of the $ 1 million.

If you’re a foreigner, then you will be charged 20 % ABSD even on your first property, which would increase the cost by $ 200,000.

Entities, such as companies and corporations, will have to pay an additional 25 % as ABSD, adding $ 250,000 on top of the $ 1 million cost.

**Loan To Value Limit**

The LTV limit essentially controls how much minimum cash downpayment you have to put up and how much in total you have to pay for the property from your end, excluding the loan from the bank.

If you have an LTV limit of 75 %, you will only have to pay for the remaining 25 % on your own and pay a minimum cash downpayment of 5 %.

If you have an LTV limit of, say, 55 %, you will have to come with the remaining 45 % on your own and manage a minimum cash downpayment of 10 %.

If you have an outstanding loan to your name, your LTV will decrease to 45 % or 25 %, in which case, you will have to chalk out a 25 % cash downpayment.

If you have two outstanding loans, your LTV will drop to 35 % OR 15 %, meaning you have to come with the remaining amount, plus a 25 % cash downpayment.

**Up Front Cost Breakdown For A S$1M Condo**

As mentioned earlier, the upfront amount that needs to be paid for any property depends on the BSD, ABSD, legal fee costs, and property price.

If you are a Singapore citizen buying your first million-dollar property will only have to pay for BSD.

So, assuming that the LTV is 75 %, you will have to pay the remaining downpayment of $ 250,000 and the BSD fees of $ 24,600, which comes up to a total upfront cost of $ 274,600.

Now, assuming that the LTV is 55 %, you would have to pay the remaining downpayment of $ 450,000 and the $ 24,600 BSD amount, totaling an upfront cost of $ 474 600.

Now, if it’s your second property, then you also have to factor in the 12 % ABSD cost, i.e., $ 120,000.

So, an LTV limit of 45 % means you will have to pay the remaining $ 550,000, added with the $ 24,000 BSD, further added with the $ 120,000 ABSD, resulting in an upfront cost of $ 694,000.

If the LTV limit is 25 %, you will have to pay the remaining $ 750,000, added with $ 24,000 BSD, further added with $ 120,000 ABSD, resulting in an upfront cost of $ 894,600.

Note that Singapore’s permanent residents will have to pay 5 % ABSD on their first and 15 % ABSD on their second property purchases.

On the other hand, foreigners will have to pay 20 % ABSD on all property purchases.