Tips for foreigners buying or renting in Singapore

Getting lost in translation when navigating the perpetually choppy waters of property acquisition in a new country is part and parcel of being an expat.

Although the Singapore property market can be less convoluted then the markets in South Korea, Vietnam, India or Indonesia, some regulations will at most times come across as strange. Things like a five-year minimum occupation period (MOP) to additional buyer’s stamp duty (ABSD) can be confusing when encountered for the first time.

So, in an effort to streamline the understanding of the process here, we’ll tackle a few pivotal points.

The length of stay will determine whether buying or renting is the best option for you. As a foreigner, buying a new BTO (public housing) is out of the question, leaving only private property which includes executive condominiums that have been privatised after they pass the 10-year mark. ECs that have been privatised are of a smaller quantity than regular condominiums at this point so it is likely a condo is where you’ll find yourself.

Regardless, if you’re staying in Singapore for a few years only, then renting might be the better option for you. Foreigners can rent out a HDB apartment or a room although this is dependent on HDB’s quota for the block. A minimum of six months’ stay is required. For private property, the duration of the lease depends on the landlord and therefore, you should negotiate with the person directly.

Private property in Singapore is not cheap and in recent years, even with oversupply, the prices aren’t correcting to the point where any price drop is of a significant degree. Also, as companies are either removing or reducing the expat packages that was once upon a time generous, the means to purchasing a new condo or even a resale one will likely be borne by you.

A 1BR condo unit can easily cost about $600K or so in a fairly connected area, but things like what level the unit is on and where it is facing will have an impact on the cost. And you will want to live in an area that is serviced by public transport, otherwise more costs will be incurred from having to purchase a personal vehicle.

Bigger condo units very quickly ascend to and beyond the $1,000,000 mark. Bank loans will help to ease the purchase but that would mean paying beyond the years you may have planned to remain in Singapore.

If you do plan to live in Singapore permanently or at least, indefinitely, then purchasing a home will make things easier. Furthermore, it gives you the opportunity to dabble a bit in the property market, when you finally choose to move to a new area in Singapore or outside of the country completely.

As an expat in Singapore, a condominium is the one property type that you can purchase with no restrictions, save for considerations like your Total Debt Servicing Ratio (TDSR) and ABSD. However, as mentioned above, BTO flats are out of the equation.

Landed property as well are unavailable to an expat unless you become a Permanent Resident (PR). Landed properties include bungalows, semi-detached houses, terrace house and cluster housing. These property types are available only for citizens and permanent residents (PRs) and even then, purchase can only be made with special approval from the Land Development Authority (LDA).

However, some developments like Seawind have townhouses built within the development but since it has a mix of condos and townhouses, foreigners may purchase them. If a townhouse is something you want, then consider developments like Seawind and SeaHill may just be the options you’re looking for.