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How To Build Your Dream Home
Singapore

This guide is also useful for those first time buyers of HDB Flats and singles who are planning to get marry and are not sure of how to build their dream home with their loved ones in Singapore. The following are some tips which we have gathered and might prove useful to you, together with some topics and links provided on the site. You are advised to read some of the tips and information from our site, although they are by no means thorough, representative and exhaustive. We give no warranty, guarantee or other representation about the approaches, accuracy of the information and accept no liability for any loss or damage which may arise from reliance on it.

1    Keep your mind open - first and foremost is keep you mind open so that you can listen to tips and advice from friends, relatives, family, agents, and so on in order for you to act wisely. Identify your objective with a clear mind, and tinted by greed or pride as the main driver.

2    Careful Planning & Research - commitment in property is not a small matter, simply because the amount involved is not only substantial and a long term commitment, it affects you and your family if you make a blunder. Apart from financial commitment, you may also have to consider other factors such as near to your child's school, your parents or a location near MRT , etc. It is essential that you exercise due diligence through careful planning & research.

3.   Comparation - make a comparison study of the potential property you have short listed.  Check market value, and compare price, location, MRT, amenities, facilities, etc of nearby or surrounding properties, and also other locations to sure it is a reasonable buy. Get a bank valuation if possible.

4.    Home - Hunt for a home (not house) where you can enjoy the comfort, happiness, harmony and togetherness of a family. If you are looking for a house for investment, then you have to go for other criteria. If you are looking for a home, you should place more emphasis on the needs of your family, over and above the investment thought. A home needs to go through a consultative process of a family. In my opinion, the latter is much more important. Ideally, you can have both the wishes.

5.    Income - Income and job security plays a critical part in your ability to service your housing loan repayment. Think on a longer term basis. Work out your monthly contribution to your CPF ordinary account from employment or your self-employed business, which can be utilized towards paying the monthly installment for your house. Don't use up all your cash and CPF balance towards the purchase of a property. Allow for some contingencies for `rainy days' , renovations, children's education, and so on. If you take a loan from HDB, they will utilize all the balance in your ordinary CPF first, and then work out the quantum of loan to be extended to you. You can keep some reserve elsewhere, say by parking in investment-linked insurance, shares, or other form for contingency purpose before the HDB loan. If you borrow from the bank, you may not require this as the bank prefers to lend you more.

6.   Action - Act wisely with a balance budget taking other factors into consideration. In order to have a happy home, you ought to have some money left for enjoyment, travelling, childrens' education, and some saving, besides your normal monthly expenses. Don't over commit on renovation, furnishings, etc. You want a home with less financial burden, and not ending up unable to pay our PUB bills, telephone bills and so on.

Information :

1.  HDB Grant of 30K & 40K.- Available to first-time Singapore Citizen family of HDB resale flats. If you stay in the same town as parents or within 2 km from your parents, you are eligible for a $40,000/- grant, otherwise you will be eligible for a $30,000/- grant. This amount will be credited to your CPF account and can be used for deposit or payment of your resale HDB Flats. This grant is not applicable for new HDB flats, as the price of the new flats are lower.

2.  Submit application before marriage - You are allowed to apply for New HDB Flats before marriage i.e under the Fiance/Fiancee scheme. However, you have to produce your marriage certificate at the estimated delivery possession date of the flat or 3 months after you have taken possession of the new flat, whichever is later

3. Down Payment for Flats - For new HDB flat, you are required to pay the $2,000 booking fee and 10% downpayment. For resale HDB flat, the downpayment is 10% of the valuation or the purchase price whichever is the lower. As from 19 July 2005, you can withdraw up to 6% of your CPF for downpayment and the balance 4% in cash. This cash component will be increased by 1% to 5% from 1st January 2006 like private property i.e 5% cash and 5% CPF for deposit of property from 19th July 2005.   Please reserve some CPF to cover other costs related to the purchase such as legal fees, home protection insurance, etc for both new and resale flats, otherwise you end up paying cash.

4. Can rent out 1 & 2 rooms - In case of need, you can rent out your rooms. For 3-rooms HDB flat, you are allowed to sublet 1 room, and for 4-rooms flat and above, you can sublet 2 rooms. You must stay in the flat. You are not permited to sublet the whole flat, unless you fulfil other requirements as laid down by HDB such as you have occupied the flats for at least 10 years if you have an outstanding HDB loan ( 5 years without an outstanding HDB loan), you are going to work overseas or study overseas, you are living with in a quarters provided by employer, and so on. The subletting of rooms or flats act as a buffer in case you are in financial need.

5.   Deferred loan repayment.  HDB allows deferred payment of monthly loan instalment, if in case you are out of job or in financial difficulties. Of course, this applies to those concessionary loan taken with HDB.  Currently, they allow two deferments, and each deferment is for a period of six months. The condition is that you have to utilize all the balance in CPF ordinary a/c before they could grant the deferment. This is a temporary relief for those of you who are out of job or unable to service the loan instalment.

For more information, Click here to log in to HDB Website.