Got ROI? How To Calculate If You’ve Made A Profit From Selling Your Property

PropertyGuru Editorial Team
Got ROI? How To Calculate If You’ve Made A Profit From Selling Your Property
What’s the Singaporean dream? Some would say it’s to buy an investment property, and then flip it on the property market, making a six or even seven figure sum overnight.
Thanks to a strong property market, real estate continues to be a popular way to invest in Singapore. But a smart investment does require strategic buying and selling in order to obtain a healthy return on investment (ROI).

“Flipping” property in Singapore

In order to make money on the property market, the basic premise is simple—you buy property and then sell it later at a higher price. “Buy low sell high”, the guiding principle of investing, applies here as well. Many property investors thus aim to buy undervalued properties and then sell them when their prices reach a peak.
Flipping property refers to the practice of purchasing a property and then selling it soon after at a profit. The sale can happen anywhere from a few months to a few years after the initial purchase.
In Singapore, property flipping tends to take years rather than months, due to the imposition of Seller’s Stamp Duty (SSD) on residential properties that are sold within three years or less.
Calculating your return on investment can be tricky. Just because you bought it for $1 million and are now selling it for $1.5 million does not mean you earned $500,000. There is a whole list of additional costs that must be taken into account when calculating your ROI.

Calculating net sales proceeds from selling your property

In order to calculate net sales proceeds, take the difference between the selling price and purchase of your property, and deduct all the costs you have incurred in the property transaction.
ROI can be expressed as a percentage of the original value.
So, if you bought a property for $1 million and sold it for $1.5 million, your ROI would be:
($1.5 million – $1 million) / $1 million = 0.5 or 50%
HDB flat owners can use this calculator to work out estimated sales proceeds.
Here are some costs to include:

Interest and fees for mortgage

Taking out a mortgage, whether from the HDB or bank, involves a plethora of additional costs. This includes the total amount of interest paid over the term of the mortgage. It also includes all administrative fees and other charges such as late payment penalties. If you paid off your mortgage early, you will also have to factor in prepayment penalties.

Legal fees

You will have two sets of legal fees to account for—the legal fees you paid when purchasing the property, and the legal fees for the sale of the property. Make sure you ask the lawyer whether disbursements such as printing fees are included in the quotation.

Agent’s fees

Factor in any agents’ fees that might have been paid when you bought the property, as well as any you expect to pay when selling the property. Agents’ fees are normally 1% for buyers of HDB resale flats, 2% for sellers of HDB resale flats and 2% for buyers and sellers of private property, but they can be different depending on what you have agreed with the real estate agent.


Any money you’ve spent renovating your property must be deducted from your net sales proceeds, but in some cases the renovations might actually add to the value of the property and enable you to raise your selling price.

Maintenance fees and sinking fund

For certain types of private property such as condos and strata landed houses, you will have to make regular payments of maintenance fees and sinking funds. Also factor in any sums you might have paid for maintenance of your property, such as repairs that were effected when you first moved in.

HDB administrative fees

When dealing with an HDB flat, factor in the HDB administrative fees that were paid when you purchased the property, as well as those you will pay in the sale that is about to take place.

HDB resale levy

Selling an HDB Executive Condominium or DBSS flat? You might need to pay a resale levy if you are selling the property and then buying another new HDB flat or EC.

HDB upgrading fee

If your block or estate has been upgraded, you will have to factor in the cost of HDB upgrading fees and administrative fees incurred.

Seller’s Stamp Duty

For residential property bought on 11 March 2017 onwards, the seller must pay the following Seller’s Stamp Duty amounts to IRAS:
– 12% if they sell the property after one year or less
– 8% if they sell the property after one to two years
– 4% if they sell the property after two to three years

Buyer’s Stamp Duty and Additional Buyer’s Stamp Duty

When you purchased the property, you would have paid Buyer’s Stamp Duty to IRAS.
In addition, if you are a Singapore Citizen who already owned an existing home when you bought your residential investment property on 12 Jan 2013 or later, you would have also had to pay Additional Buyer’s Stamp Duty (ABSD).
All PRs and foreigners are now liable to pay ABSD on all residential properties they purchase.

Property tax

Add up all the property tax you have paid over the years. The property tax rates are higher if you are a non-owner-occupier not living in the investment property you are selling. Meanwhile, if you are an owner-occupier who has been living in the property, your property tax rates will be lower.

CPF monies used with interest

If you used CPF savings to pay for part of the property, don’t forget that you need to return that sum to your CPF Ordinary Account together with the interest that amount would have accrued over the years.
Those who bought HDB flats with the help of CPF grants will also have to return the grant amounts together with interest when selling the property.
The money, when returned to your CPF Ordinary Account, still belongs to you, so technically you do not need to deduct it from your ROI. However, you should still take note of how much of your proceeds you need to pay into your CPF Ordinary Account, as this amount is subject to the usual withdrawal restrictions imposed by the CPF Board.

How to calculate annualised returns

Flipping a property usually takes a number of years. So, when calculating your ROI, it’s a good idea to not only look at the net amount you’ve made from the sale, but also your annualised return—that is, your return on investment averaged over the amount of time you were holding on to the property.
To do that, we first need to know our ROI. Let’s say that after deducting the above costs, your net ROI is 0.5 or 50%, and you sold that property 10 years after buying it.
To find annualised return, you would use this formula:
(1 + Return)^(1/No. of years) – 1
= (1 + 0.5)^0.1 – 1
= 0.4138 or 4.14%
(In the above example, 0.5 = your ROI, and 0.1 = 10 years.)
Knowing your annualised returns can help you compare a property transaction to other ways you could be investing that money.
For comparison’s sake, at the beginning of 2019, the total annualised return of the Straits Times Index was 9.2% over a 10-year period.
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