Buying and Selling Protocols
Are you in the buying mood for any Singapore properties? You may have heard it right but yes, Singapore market is open to anyone who would want to buy commercial and/or residential properties. Foreigners or Foreign businesses are allowed to purchase selected residential properties. However, similar to any other buying processes, buying new properties in a country requires few considerations, basic restrictions that you need to be aware of before signing any contract.
For buying properties in Singapore, it is important to consider that purchasing flats or properties directly from the HDB require:
• The lessees are to complete the required and agreed occupation time before purchasing the property
• After the property has been acquired, the lessees are required to continue to stay in the HDB flat.
Consider that these flats may include the ones bought from the open market using the CPF Housing Grant. Hence, if you purchased flats in the real estate market without the CPF Housing Grant, there is no need for you to fulfill the required occupation period. However, as you are committed to lease agreement, you need to fulfill the agreement by staying in the HDB flat until the commitment has been fulfilled or even after the purchase.
The entire process takes approximately 10 to 14 weeks and it is advisable to prepare all legal documents and papers to prevent unnecessary delays. Here are some helpful tips in buying or selling properties?
1. Hire an agent. Choosing a professional agent can make the difference in making a wise investment or a regretful one. An agent can help you scout for the property that meets your needs and also takes card of all the legal paperwork involved. Agents may also offer advice and guidance on financing or legal representation.
2. Get the price you want. In preliminary negotiations, make sure that small details of the property, such as repairs, have been noted and discussed so that everything goes smoothly.
3. Have an option to purchase always. When purchasing HDB property, consider that the HDB standard option to purchase has been replaced with the Sale and Purchase Agreement form. This serves as a contract and can be used in any resale flat and property transactions. Supplemental agreements or any agreements of the like are not allowed. This standard option came into effect as of 15 April 2003.
For Private properties, an option to purchase is obtained through the agent if the seller. You are required to pay a non-refundable option fee (1% of purchase price) and lasts for 14 days.
4. Hire a lawyer. At this point in the negotiations, you need to hire that will help you verify the seller’s legal status and the property and terms of sale.
5. Selecting the right payment scheme. Buyers have the option to choose the rates and terms for financing. Filling an application form along with a validation report prepared by a licensed and authorized valuer can easily do withdrawal of CPF savings.
6. Exercising the Option/HDB 1st Appointment. For HBD properties, both buyer and seller are to attend the Sales Declaration & Registration appointment. This act is an indication that a deal has been made in consideration of the final price. Four weeks after the appointment, the HDB will check the eligibility and validity of the transaction. The next step is then to arrange for a 1st Appointment and the whole process usually takes more or less four weeks.
For Private properties, a payment fee of 5% of the purchase price must be paid and must be stamped within 14 days of the contract.
7. Legal Inspection and Completion. Your appointed lawyer would conduct an investigation of title deeds and send requisitions to various government departments involved. Likewise, the sellers’ lawyer will also prepare the completion statement and have it stamped.
8. Payment settlement and handover or the HDB 2nd Appointment. For HDB properties, completion occurs exactly during or within the 2nd Appointment, a process that takes around one month right after the 1st Appointment. During this period, arrangement of the insurance and mortgage details are arranged while all legal fees are being paid at the same time. This is the same period when buyer can move or transfer to their newly purchased property.
For Private properties, the outstanding balance of the purchase price has to be settled. This might take 8 – 12 weeks and the sellers’ lawyer would advice the buyer when to move in. Singaporean procedures on buying and properties can be time consuming for both parties involved so it is advised to plan ahead to avoid mistakes that may cost unnecessary spending and time.
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