7 Types of Housing in Singapore For First Time Home Buyers Singapore, and Their Pros and Cons
Updated: Dec 16, 2022
We have compiled a list of the most common 7 types of housing in Singapore that most first time home buyer can look at when buying your first home or buying your first property in Singapore.
We have also put together the pros and cons of these 7 housing types to help you gain more clarity before deciding which type of property to go for, as buying your first property in Singapore can be a daunting affair be it for any singles or couples.
As a first timer home buyer, chances are you might not even know what are the full range of options you can choose from, as there are so many different housing types available in Singapore.
In general, the types of housing in Singapore range from public to private housing, but did you also know that there are also hybrid housing available in Singapore as well featuring a mix of public and private features?
Cut to the chase, we will not be touching too much on the eligibility of purchasing these properties today as it is another topic altogether. You can search relevant government sites for the eligibility criteria to purchase when it comes to new public, resale public and hybrid housing, but for private housing in Singapore, Singapore Citizens and Permanent Residents are qualified for all (foreigners will have more limited choices and require government approval for some private properties in Singapore).
Any other questions, you can reach out to us directly via our Facebook, Instagram or simply leave a comment at the end of this blog post and we will get back to you as soon as we can.
Here are the 7 types of housing in Singapore that most first time home buyer look at:
House #1: Build to Order (BTO) HDB Flats
House #2: Sale of Balance (SBF) HDB Flats
House #4: New Launch Executive Condominiums (EC)
House #5: Resale Executive Condominiums (EC)
1. Build to Order (BTO) HDB Flats
What are BTO HDB flats?
BTO Flats are public housing flats offered by Housing and Development Board (HDB), a public housing authority and statutory board under Singapore’s Ministry of National Development (MND). So, if you would like to apply for a BTO HDB flat, you will have to do it directly through the HDB website.
This is the most common option that young couples in Singapore would opt for as they are the lowest priced amongst all the other types of housing in Singapore. It is also a common rite of passage for many young and newly engaged couples in Singapore these days who will ask each other ‘Want BTO together or not’ as an indirect form of a marriage proposal. (haha)
Alternatively, singles above the age of 35 may opt for a BTO as well but will only be eligible for max a 2-room BTO flat in a non-mature estate.
So, how it works for Build to Order (BTO) flats is that HDB will typically announce six months in advance the land sites in Singapore where BTO flats will be built on, and then allow buyers to submit applications to ballot for a unit. But with the recent news and changes, HDB to release site locations of upcoming BTO projects three months before launch, instead of six, has caught many home seekers by surprise.
Thereafter, if you manage to be the lucky one to have balloted for a BTO unit, BTO flats will take about 3 to 4 years typically to finish building, and your monthly loan repayment only starts when you have collected the keys to your new flat. You can always check the HDB website for news of upcoming sales launches.
Pros of BTO HDB flats
BTO flats are the lowest price amongst all options
As BTO flats are highly subsidized, it is the most ideal option for most young couples in Singapore that are just starting up a family together. Particularly for young first timers looking to buy a house together in Singapore, heavily discounted BTO flats are very affordable and therefore, will place less strain on the finances of young couples.
BTO are brand new flats that come with modern layout, amenities and common spaces, minimal renovation is required
The good thing about owning a BTO is also the fact that they are brand new flats with layouts that are more in tune with the current era. Coupled with modern amenities, therefore you require minimal renovations done. This will help property buyers to save on renovation costs as well
BTO have a fresh 99 years lease as compared to resale HDBs
On top of that, you will also get to enjoy a fresh new lease of 99 years as compared to their resale counterparts which are resale HDBs that have already been in the secondary market for a certain number of years.
BTOs have the highest potential for capital appreciation amongst all HDB flats
After 3 to 4 years of building, HDB flats still come with a Minimum Occupation Period (MOP) of 5 years, meaning that you need to stay in the flat for 5 years after receiving your keys before you are allowed to sell. More often than not, BTO flats that have hit their MOP period will always be worth more than what they were first purchased for 8 to 9 years before.
Cons of BTO HDB Flats
BTO have a 3 to 4 years waiting period for it to be built
As mentioned above, you will be purchasing a unit in an estate that has not been built yet. Faced with the COVID pandemic situation, latest news says that home buyers fret as some BTO flats may be delayed by a year or more. Therefore, we might be even looking at 4 to 6 years instead for it to complete building before you can collect your keys to your house.
Limited supply in certain areas, therefore depends on luck to be able to ballot for a BTO unit
Particularly for popular BTO launch sites, one will be faced with intense competition to be able to successfully ballot for a unit. Back in 2020, HDB flats in latest BTO exercise oversubscribed one day after their launch. Demand was high in both mature and non-mature estates in Geylang and Woodlands being heavily oversubscribed. Other oversubscribed areas also included Ang Mo Kio and Bishan previously.
BTO 5 year Minimum Occupation Period (MOP)
There is a Minimum Occupation Period (MOP) of 5 years. This means that you are not allowed to sell the flat until you have stayed in it for at least 5 years. Coupled with the 3-5 years waiting period for BTOs to be built, it will take you close to 10 years before you can sell and upgrade to any other properties in Singapore. For example, if you and your fiancé are 30 years old now, you will be approximately 35 when the BTO has completed building and 40 before you are allowed to sell.
Timing and location availability of BTO flats
BTO flat launches might not be available at your timing as and when you require, and it might also not be the desired location that you wish to purchase at. It depends on the sites that HDB plans to release at and at the end of the day, it still boils down to luck as well to be able to successfully ballot for a unit, particularly in attractive or mature locations in Singapore.
2. Sale of Balance (SBF) HDB Flats
What are Sale of Balance (SBF) HDB flats?
The words Sale of Balance simply translates to Selling of the Balance units. So where are these balance units coming from? SBF HDB flats are simply balance units from earlier BTO launches that are still not sold out.
HDB SBF launches typically happen twice a year, during May and November of the year and you can apply directly from HDB for SBF flats. Any remaining units after SBF will then be allowed for purchase via Open Booking of Flats.
Pros of Sale of Balance (SBF) HDB flats
SBF are usually ready to move in brand new flats
As compared to BTOs, SBFs are usually either in the midst of construction already or are ready for home buyers to move in in 3 to 4 months’ time. This will save on the waiting time as compared to BTOs that require 4 to 5 years to be built.
SBF allows you more locations to choose from
As compared to BTOs, SBFs are unsold BTO units pooled together from many different previous BTO projects from all locations in Singapore. Therefore, you will have a wider variety of locations to choose from.
Cons of Sale of Balance (SBF) HDB Flats
SBF are sold at higher prices than BTO
As these are units that are ready to move in, naturally their prices will not be as low as those who managed to ballot for a BTO unit when it has not completed building yet at the initial phase. With this being said, you will therefore have lesser proceeds after selling in comparison to a BTO.
SBF are usually not at a highly sought-after location
Popular BTO launches are usually oversubscribed due to their location. Therefore, there might be a chance that the reason for these remaining unsold units could be due to the area being a non-mature estate or are less accessible/ convenient as compared to those in mature and highly popular estates.
SBF have lesser choices remaining
Chances are, the most desirable units would have been snapped up by the BTO buyers first before SBF units were left over. Therefore, you might be left with lesser choices to select from.
3. Resale HDB Flats
What are Resale HDB flats?
Resale HDB flats are flats that are currently owned and occupied by someone already. They are flats that are available for sale in the open market. This means that you will no longer be buying from HDB directly, but rather off the market from an individual seller or sellers.
As mentioned previously, you can only sell a HDB after the Minimum Occupation Period of 5 years. Therefore, resale HDBs that have been put up for sale would mean that the owners have met their MOP period already.
Unlike brand new BTO flats, resale flats do not come with a fresh 99 years lease. Older resale flats will face some issues when applying for a bank loan due to the remaining lease left and also might be subjected to limited CPF usage, so please do check with your property agent or banker first before placing a deposit on any unit rashly.
Pros of Resale HDB flats
Resale HDB flats are ready for you to move in within 3 to 4 months’ time and no need to be balloted for
As mentioned, resale HDBs are completed properties resold in the open market, therefore you do not need to leave it to a stroke of luck like balloting for a BTO. The typical completion period for a resale HDB is about 3 to 4 months after you have exercised your Option to Purchase, before you can collect your keys to the unit.
PRs can buy Resale HDBs
Joint PRs buying a resale HDB flat will need to have had their PR status for more than 3 years individually, not combined together and they will be able to qualify for a resale HDB purchase. Unlike for BTO, where there has to strictly be a Singapore Citizen.
Usually available in the location you prefer
Resale HDB flats are available in almost every part of Singapore except you would find fewer of them in town area. But there is definitely a wide variety of location choices to choose from.