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23 Feb 2021 


After months of discussions, Praveen and Priyanka are ready to submit their BTO application! With a combined household income of $5,500, they are looking to purchase a 4-room BTO flat in a non-mature estate priced at around $300,000. 

Based on their income, they are eligible to receive an Enhanced CPF Housing Grant (EHG) of $40,000, which can be used to make the downpayment and offset some of the purchase price. They plan to finance the balance purchase price with an HDB housing loan over a period of 25 years.

With the above in mind, they calculate their expected costs and find out how they can use their CPF Ordinary Account (OA) savings to support their housing needs.

Table of calculations of housing expenses and if they are payable by CPF.

​Stage 1: submitting an application

First order of business: During the sales exercise, Praveen and Priyanka simply have to submit a BTO application online, together with a $10 application fee.

Stage 2: booking of flat

After successfully balloting for a queue number, they will be invited to book a flat. Since they have decided to take up an HDB housing loan, they will need to produce a valid HDB Loan Eligibility Letter (HLE) and prepare the relevant documents at their first HDB appointment. Upon booking the flat, they will have to pay an option fee of $2,000, in cash, for a 4-room flat.

Stage 3: signing of Agreement for Lease

About four months after booking their flat, it will be time for Praveen and Priyanka to sign the Agreement for Lease and pay the downpayment. Since they plan to take an HDB housing loan, the downpayment would be 10% of the purchase price — $30,000, which they can pay with the Enhanced CPF Housing Grant, if eligible.

Other expenses at this stage can also be paid with CPF OA savings, such as the buyer’s stamp duty, which can be calculated using the IRAS Stamp Duty Calculator. Praveen and Priyanka can also use their CPF OA savings to pay for the conveyancing fee if they appoint HDB to act for them in the flat purchase. This can be calculated using the HDB’s Legal Fees Enquiry Facility.

Stage 4: collection of keys

Upon collection of the keys to their new home, Praveen and Priyanka can use their CPF OA savings to pay for the survey fee, which is currently set at $275 for a 4-room flat, and the Lease and Mortgage In-Escrow registration fees, which are currently set at $38.30 each.

Praveen and Priyanka will also need to pay for the mortgage stamp duty, which is calculated at 0.4% of the loan amount, subject to a maximum of $500. Since 0.4% of their loan amount exceeds $500, they will only be charged the maximum mortgage stamp duty of $500, payable with their CPF OA savings.

As Praveen and Priyanka are planning to use their CPF OA savings for their monthly housing loan instalments, they are required to be insured under the Home Protection Scheme (HPS). The HPS protects CPF members and their families from losing their HDB flat in the event of death, terminal illness, or total permanent disability. The premium can be paid with their CPF OA savings and calculated using the CPF Home Protection Scheme Premium Calculator.

Praveen and Priyanka are also required to purchase the HDB fire insurance. The cost for a 5-year premium under FWD (HDB’s appointed insurer) for a 4-room flat is $5.94, from 16 August 2019 to 15 August 2024.

Stage 5: After moving in

Praveen and Priyanka are also taking their future recurring payments into account.

For example, after using the balance EHG amount of $10,000 and their CPF OA savings of $60,000 for the flat upon key collection, their loan amount will be $200,000. Using the CPF Mortgage Calculator, they estimate their monthly housing loan instalments to be approximately $900, which they plan to pay with their CPF OA savings. 

They plan to set aside a portion of their monthly budget for utilities, which is about $113 for the average Singapore household*. There are also service and conservancy charges payable monthly, which vary based on the town council, as well as annual property tax, which is based on the annual value of their flat type. 

They would also have to renew the fire insurance with the HDB-appointed insurer after the 5-year coverage paid during key collection, as long as their HDB housing loan is not fully paid off. The premium may vary based on the insurer, with some offering add-on packages.

Now that Praveen and Priyanka have a clearer picture of their path towards their future home, they can start working out their housing budget and set aside their savings for it!

To learn more about the various costs and fees when you buy a new flat, head to the HDB website.

Information accurate as at 23 February 2021.

*Utility bill average in November 2020 from Singapore Power.