If you are an expat currently living in Singapore, or if you are hoping to move to the island nation and make a fresh start for yourself, you may be keen to purchase property – whether as an investment, or to reside in yourself.
Foreigners have the capacity to buy a number of different types of property in Singapore, including the majority of condominiums, executive condos that are at least a decade old, and land houses on the popular tourist island of Sentosa.
However, there are a number of aspects of local real estate that you should familiarise yourself with before you start searching for the perfect Singapore property. Read on to find out what they are, and discover how to get started in the world of Singaporean real estate.
But first, let’s take a quick look at some of the reasons why Singapore is such a popular option for foreigners seeking to buy real estate overseas.
Why Buy In Singapore?
One of the main reasons so many foreigners purchase property in Singapore is due to the low tax rate, and the lack of capital gains tax.
In addition, Singapore is known for the stability of its economy and its government, not to mention its positive and encouraging business environment that rewards effort and innovation. This makes buying property in the country a less risky investment than it might be in other regions that are more susceptible to economic peaks and troughs or political discord.
Things To Consider
Now that we’ve established why you may be eager to invest in Singaporean real estate, let’s take a deep-dive into the important things you need to know before you start house-hunting.
Some Types Of Property Are Off Limits
While you will have quite a choice of real estate investments to consider – particularly if you are keen to purchase a condo – there are some properties that are off limits for anyone who is not a Singaporean citizen.
These include younger executive condos, and HDB flats. In addition, permanent residents are allowed to apply to the Singaporean Land Authority for the right to purchase a landed house, although they will have to meet certain requirements to do so – including being able to prove that they make financial contributions to the country.
You Can Get A Mortgage To Pay For Your Property
If you have the initial capital to purchase a property in full, then you are in a fortunate position. However, if you do not have a significant sum readily available, but you are still keen to buy real estate in Singapore, you can apply for a mortgage.
Fortunately, there are plenty of options available to suit different budgets and circumstances, so it shouldn’t be difficult for you to find the best home loan in Singapore for your unique situation.
Before you commit to a particular loan, however, it’s important to do your homework and consult with local financial experts so you can find a package that will be entirely suitable. For example, you should carefully consider whether you would rather opt for a floating interest rate or a loan with a fixed rate. You may also want to factor in any free conversion, and whether a waiver of redemption will have to be paid if the property is sold on during the lock-in period.
Finding The Perfect Place
When you purchase a property in Singapore, there are a number of additional fees and taxes you will have to pay besides your home loan.
These are in addition to the normal Buyer's Stamp Duty, Singapore Permanent Resident , and increases to 5% on all subsequent properties. If you are not an SPR, however, this stamp duty will be 15%, so you need to make sure you have the finances available to pay this amount. There may also be additional payments, including any legal fees you may have incurred as part of the purchase process.
Finding the Perfect Place
When it comes to the question of what type of property to buy – and where – this will depend on your particular circumstances, your budget, and what you plan to use the property for. If you will be residing in the property as an expat, with your family, then you will be most likely be concerned with access to the best local schools and services.
On the other hand, if you are buying as an investment, you may be more concerned with the location. For example, properties in China Square will command a much higher price and therefore be considered more valuable than properties located in Jelebu, which is further from the heart of the city.
As a foreigner who may be vulnerable to potential scams, it is a good idea to enlist the services of a well-qualified local lawyer, as well as a trustworthy real estate agent who can guide you through the entire process. Not only will they protect you from accidentally purchasing the wrong type of property, but they will also have an in-depth understanding of the local market and the laws regarding buying property. As such, their advice is sure to be invaluable as you go about finding the ideal place for you.
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