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Marriage or Mortgage: Should You Get Married or Buy A Home First?

Eugenia Liew
Marriage or Mortgage: Should You Get Married or Buy A Home First?
Getting married and purchasing a first home are some of the significant milestones in a person’s life. And in Singapore, they often happen around the same time. The trouble is, both marriage and buying a home are huge financial commitments, so it could be wise to take a step back and plan your steps before recklessly diving into these major decisions.
It is very common for people in western countries to live with their romantic partners before or without getting married. For instance, a study by the Pew Research Centre found that among adults in the US aged 18 to 44, a whopping 59% have lived with a unmarried partner at some stage in their life. In Australia, in 2017 alone, 16% of all Australians were cohabiting with their partners, and a staggering 81% of marriages in Australia were preceded by cohabitation.
In Singapore however, most young couples apply for their Build-to-Order (BTO) flats prior to getting married, because of the substantial waiting time of three to four years to obtain their completed flats. (The wait is even longer in current times, due to COVID-19 related construction and supply delays.) From 2010 to 2019, young people aged 25 to 34 made up more than half of the flat buyers who completed their purchase of BTO flats for 4 and 5-room units.
Whether you should get married or purchase a home first is a personal decision. But aside from your personal preferences, it is best to consider the financial costs of these significant milestones.

Costs of Getting Married vs Buying A Home in Singapore

Purchasing a Home

Property4-room HDB BTO flat (Hougang, Aug 2021)
Selling price$324,000
If you took HDB loan
(assuming 90% LTV)
$32,400 downpayment (upfront) + $291,600 loan (split into monthly repayments, excl. interest)
If you took bank loan (assuming 75% LTV)$81,000 downpayment (upfront) + $243,000 loan (split into monthly repayments, excl. interest)
Other costs$1,000 (estimate for expenses like legal fees, home insurance, property tax, etc)
First, let’s look at the some of the costs involved in purchasing a home in Singapore. We’ll use the typical ‘starter-pack home’, a 4-room BTO flat, as an example since young Singaporeans aged 25 to 34 comprised about 60% of flat owners who completed the purchase of these flats.
In the August 2021 BTO cycle, the most highly applied project was the 4-room flats in Hougang. For those, prices start at $324,000. Let’s use this figure for our calculation.
Let’s assume that you take up a 90% Loan-to-Value (LTV) ratio housing loan from the HDB. For a 4-room BTO unit worth $324,000, you’ll need to pay the remaining 10% of the property’s value as upfront downpayment (cash, CPF or a mix), which amounts to $232,400. Additionally, your initial purchase costs also include legal fees such as conveyancing fees to HDB as well as a Caveat Registration Fee of $64.45 to be paid to the Singapore Land Authority (SLA).
If you decide to take a bank loan, the upfront cost is higher, mostly because there is a lower LTV limit of 75%. This means a minimum downpayment of $81,000, of which at least 5% must be in cash.
Of course, there will be the long-term monthly mortgage repayments to think about as well. But since this article discusses timing marriage (i.e., wedding) expenses with the large property expenses, we focused on the upfront costs.

Getting Married

Wedding costPrice Range
ROM & Solemnization and Venue booking$2,500 – $7,000
Catering / lunch reception (for 100 to 150 guests)$1,500 – $4,000
Wedding Banquet (for 100 to 150 guests)$15,000 – $36,000
Engagement Ring$3,000 – $5,000
Wedding Bands$3,000 – $5,000
Bridal package$2,000 – $6,000
Actual day photography$1,000 – $2,000
Actual day videography$1,500 – $3,000
Pre-Wedding Photography & Videography$1,600 – $2,700
Makeup artist & hairstylist$400 – $1,000
Bridal Party Attire & Makeup$500 – $1,000
Flowers$500 – $1,000
Total$48,950 – $94,300
For most couples, their wedding day is a magical celebration of their love which happens once in a lifetime. Not to put a damper on the joyous mood, but wedding costs are some of the highest which couples would incur during their time together.
The table above shows various costs which a couple would incur for a mid-range wedding. Since we’re no experts on weddings, we adapted the table from The Wedding Vow. We’ve also excluded some of the variable and optional costs from the tabulation (e.g., photo booth, car rental, etc).
Typically, your wedding banquet would account for the most significant bulk of your wedding costs. Assuming that you cater for 100 to 150 guests, the cost of your banquet can go up to $36,000. Others costs associated with a wedding include services such as wedding photography and bridal packages, and the cost of your wedding rings. These costs vary depending on factors such as the number of gown changes, the type of wedding ring, and the location of your wedding photoshoot.
Depending on how big of a party you want to throw, you can expect to spend between $48,950 to $94,300 on average just for your wedding!
So, should you spend your money on your wedding or buy a home first?

Should You Get Married or Buy A Home First?

It’s definitely a personal choice, but here are some considerations:

Long BTO Waiting Times Mean It May Just Be More Practical to Buy First, Marry Later

Because of COVID-related disruptions to construction of housing developments, the average wait times for completion of BTO flats could be as long as five to seven years! This is a big reason why many couples choose to apply for a BTO way in advance before the actual wedding and solemnisation.
After all, even if you are not yet married, you can still benefit from the various HDB grants and subsidies which applies to married couples, as long as you produce your certificate of marriage within 3 months of completion of your HDB flat purchase.
That means that you can BTO with your boyfriend or girlfriend under the Fiancé-Fiancée Scheme, wait the few years for the flat to be ready, then get married.
Eligible first-timers whose average household monthly income does not exceed the $9,000 income ceiling can enjoy $5,000 to $80,000 in the Enhanced CPF Housing Grant. For those who are applying super early – like while studying or serving National Service, when you have no income – you may also be eligible for the Deferred Income Assessment, which allows you to assess your income closer to the key collection date.
The case is pretty clear for couples eyeing BTO flats. It’s just that much more convenient to apply for a flat first. However, what about HDB resale flats which are available almost immediately?

HDB Resale Flats Are Ready Immediately, Which Means Immediate Payment Too

Unlike BTO flats that take a while to build (and hence, collect payment), resale flats often change hands within months. Thus, the timing for this is much more crucial, because if you intend to get married and move into your new resale flat at the same time, then it’s likely that all your expenses will be incurred at around the same time.
Resale flats are also generally more expensive than BTOs (as they’re not subsidised by the Government), although buyers are also potentially eligible for more grants (like the Proximity Housing Grant).
That means you must be prepared to pay for your wedding, as well as the upfront costs of purchasing the property (e.g., downpayment, stamp duties, renovations and furnishing, etc).

Private Properties May Have Different Payment Schedules, But the Downpayment May Be Higher

With private property, there are some other considerations. If you buy a Building Under Construction (BUC) – usually new launch projects – then there’ll still be a few years or months until its completion. This means you may be able to make payments according to a progressive payment scheme, which staggers payments according to the construction progress. This way, the financial burden may be spread out and more manageable.
If you buy a resale property, then the same dilemma as buying a resale flat applies. It is ready immediately, which means you will need to cough up the upfront payments within the short timeline too.
It’s also noteworthy that not only does private property cost more, but you will have to take a bank loan, which has a lower LTV limit of up to 75%. This means that assuming you take the maximum 75% loan, you will still need to come up with a downpayment of at least 25% (at least 5% cash).

If You Marry First and Buy Later, Where Will You Stay?

However, say you decide to put your home purchasing plans on hold. Then the next question to ask yourself is whether you’d continue to stay with your parents or find a place to rent for the time being.
If you have the option of bunking in with your parents (or in-laws) temporarily until you have more savings to move out, then great. But let’s say that you decide to rent a home in the meantime, how much would that cost?
According to median HDB rental prices, even the cheapest 3-room flat option will set you back between $1,400 to $2,000 per month. And that’s without factoring in any agent fees, utility bills and other expenses.

Most Importantly, Don’t Rush into Marriage or Your Mortgage

As you can see, there are many considerations to this complex question. The best answer for you will depend on not just your finances, but your personal preferences and relationships as well.
While it seems the typical route for Singaporeans to buy a house first (especially BTO) and marry later, it is definitely something we don’t recommend rushing into.
There are considerable risks involved when you make a home purchase before getting married. If things go south and you happen to break up with your partner (touch wood!), you’d have to forfeit the flat or private property which both of you intended to purchase, and this could lead to hefty financial costs!
Depending on the stage you’re at in property purchase process and the type of property you opted for, this could entail you foregoing the Option Fees, Stamp Duties as well as a portion of the downpayment you paid to secure your home.
We say, it’s best to choose the route you’re most comfortable with and then plan the finances for it. If you feel ready in your relationship to apply for a home together and your finances allow it, go for it!
Don’t forget to also talk through some important financial considerations on purchasing a home as an unmarried couple, such as deciding who contributes what to the household, the percentage of CPF funds each person is contributing to the down payment/mortgage repayments of the flat, as well as who the legal owner of the home should be. If left unsorted, these issues could potentially lead to conflict and possible legal implications should the relationship sour over time.
If you feel pressured and think you want to wait it out, that’s okay. You can always seek alternative arrangements while waiting for the right time.
You can consider staying with your parents or in-laws, or if you are waiting for the completion of your BTO flat, you can still rent a flat to start your own family in the meantime. Under the Parenthood Provisional Housing Scheme, married or engaged couples can rent a flat while waiting for their uncompleted flat booked under the HDB’s sales exercises.
Here’s wishing you and your partner or spouse all the best in your journey towards owning a new home! If you would like more guidance – whether it is to work out what property you can afford, compare mortgage rates, or simply seek specific advice for your unique situation – our home loan advisors are ready to help.
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