What should I consider when buying a BTO flat in Singapore?

A BTO (Built-to-Order) HDB flat is a popular option among Singaporeans. If you are planning to buy one, you need to plan your finances properly as you need to plan your downpayment, home insurance and renovation costs, among others. However, the more crucial factors that you need to consider are on the location and your eligibility.

 

How much do I need to buy a BTO flat?

As of 2021, the price of BTO flats has increased slightly. A 2-room flat will cost between S$117,000 to S$180,000 and S$98,000 to S$113,000 for mature and non-mature estate flats. This price goes up gradually among the 3-room and 4-room flats with the 5-room flat going from $$372,000 to S$404,000 for non-mature flats. The BTO flat that you buy will come with internal fittings, sanitary finishes and basic facilities.

How do I apply for a BTO flat?

You will have to apply online through the InfoWEB by HDB. Take note that you can only do this when there is a launch and it can be very congested at times.

What can CPF Grants do to help pay for the BTO Flat?

The CPF Grants are used to help reduce the price of buying the BTO flat. Eligible buyers can get up to S$80,000 that would be really helpful. Take note that if you are a first-time household, you could be eligible for the EHG or Enhanced CPF Housing Grant of up to S$80,000 provided that your household income is below S$9,000 monthly. There was also special providence for applications that were made prior to September 2019.

What costs should I be aware of when buying a BTO flat?

Generally, there are a few areas that you must be aware of that will incur a cost. Take these into consideration to help you plan your finances better. They are:

• Application fee – This is a fee that you pay to apply to buy a BTO flat which is about S$20.
• Option fee – This will form part of your downpayment and is must be paid when you confirm that you are buying the BTO flat. The cost is S$500 for a 2-room flat, S$1,000 for a 3-room flat and S$2,000 for 4-room flats or bigger.
• Downpayment – This ranges between 10% – 20% of the sale value depending on whether you are using a bank loan, the HDB housing loan or not taking any housing loan.
• Legal fee – This is the fee needed to process your application for ownership of the property and is a small percentage (usually 1 to 3%) of the property value. It includes the stamp duty, conveyancing fees and caveat registration fees.
• Home Insurance – This is low premium insurance that you need to buy for the property. Take note that it is compulsory to buy fire insurance for your BTO flat (like every other form of property in Singapore).
• Other fees – Besides the mandatory fees as mentioned, you will also have to plan your finances to support your mortgage repayments, taking into consideration the interest rates that are applied. As BTO flats are new, you will need to renovate the unit. This depends largely on your preference and what you intend to do it up to. As a rule of thumb, it should cost you between S$30,000 to S$50,000 for renovation.