First Home in Singapore: A Step-by-Step Financial Checklist Before You Commit

The excitement of buying your first home can lead to a very common mistake: viewing before you're financially ready. This checklist is designed to ensure your finances are in order before you sign anything.

Step 1: Know Your Maximum Loan Amount

Your maximum loan is governed by the Total Debt Servicing Ratio (TDSR), which caps total monthly debt obligations (including the new property loan) at 55% of gross monthly income.

For HDB loans, the Mortgage Servicing Ratio (MSR) further limits the monthly HDB loan repayment to 30% of gross monthly income.

What to do: Get an In-Principle Approval (IPA) from a bank before you start viewing. The IPA tells you exactly how much you can borrow. This takes 1 to 3 business days and costs nothing.

Step 2: Calculate Your CPF Available for the Purchase

Your CPF Ordinary Account (OA) balance can be used for the downpayment and monthly repayments on HDB and private residential properties.

Log in to CPF Online Services and note:

• Your current OA balance
• Any existing CPF usage on other properties (if applicable)
• Your monthly CPF contribution (this accumulates monthly and is available for your mortgage)

Step 3: Calculate Your Cash Required

For an HDB flat:

• HDB loan: 20% downpayment, which can be paid entirely from CPF
• Bank loan: 25% downpayment, minimum 5% must be in cash

For a private condo:

• 25% downpayment with minimum 5% in cash (first residential property, bank loan)

Additionally, budget for:

• BSD (Buyer's Stamp Duty): Approximately 1% to 4% on purchase price (varies by price band)
• Legal fees: $2,000 to $4,000 depending on property type
• Renovation: Budget at least $30,000 to $80,000 for a resale unit, more for private
• Emergency fund: Keep at least 6 months of expenses in liquid savings after purchase

Step 4: Understand Your BSD

BSD is paid on every residential property purchase in Singapore, by every buyer. The rates are:

• First $180,000: 1%
• Next $180,000: 2%
• Next $640,000: 3%
• Next $500,000: 4%
• Remaining amount: 5% or 6% (for higher price bands)

For a $700,000 flat, BSD is approximately $18,600. For a $1.5M condo, approximately $44,600. This must be paid in cash or CPF and is not financeable.

Step 5: Confirm ABSD (If Applicable)

As a Singapore Citizen buying your first residential property, ABSD is $0. But confirm your status:

• Are you jointly buying with a PR? ABSD applies at PR first-property rate (5%).
• Are you a PR buying your first property alone? ABSD is 5%.
• Do you currently own any other residential property? ABSD applies.

Step 6: Model Your Monthly Repayment

Use a mortgage calculator to stress-test your monthly repayment at:

• Current interest rates
• Rates 1.5% higher (stress test for future rate increases)

Ask yourself: if rates go up by 1.5 percentage points, is the monthly repayment still manageable?

Step 7: Plan for Ongoing Costs

First-time buyers often underestimate ongoing ownership costs:

• Property tax (for private property, owner-occupier rates start at 0% on first $8,000 annual value)
• Maintenance fees (for condos: $200 to $700/month)
• Fire insurance and home contents insurance
• Annual conservancy and service charges (for HDB)

Our Take

The buyers who get into trouble are almost always those who skipped steps 1 to 3. Knowing your budget before you view is not just financially prudent, it lets you negotiate with confidence when you find the right property.

Have you gone through this checklist for your current situation?

Frequently Asked Questions

What is the minimum income needed to buy an HDB flat in Singapore?

There is no minimum income for an HDB resale flat purchase. However, your income determines how much you can borrow under MSR (max 30% of gross monthly income for HDB loan repayment) and TDSR (max 55% of gross monthly income for all debt). Practically, most buyers need a household income of at least $3,000 to $4,000/month to finance a modest HDB resale flat purchase.

How much CPF do I need for an HDB downpayment?

For an HDB housing loan (80% LTV), the 20% downpayment can be paid entirely from CPF OA with no cash required. For a bank loan (75% LTV), 25% downpayment is required, at least 5% must be in cash, and the remaining 20% can come from CPF.

Does BSD apply to first-time home buyers in Singapore?

Yes. BSD applies to all residential property purchases in Singapore, regardless of whether it's your first property. There is no BSD exemption for first-time buyers. BSD must be paid within 14 days of exercising the OTP.

What is the maximum loan tenure for an HDB flat in Singapore?

The maximum loan tenure for an HDB housing loan is 25 years, capped at the younger of: 65 minus the borrower's current age, or the remaining lease minus 20 years. Bank loans have similar caps.

Should I get an HDB loan or bank loan for my first home?

For first-time HDB buyers with limited cash, the HDB loan offers a lower cash downpayment requirement and a stable interest rate. For buyers with cash reserves and willingness to manage rate risk, bank loans can be cheaper in low-rate environments. See Post 24 for a detailed comparison.

Buying Your First Home and Not Sure Where to Start?

Serene & Mei works with first-time buyers to map out the entire financial picture before they commit to a single viewing. It saves time, avoids mistakes, and gives you the confidence to negotiate properly.

Book a session with Serene & Mei →