How Much Should You Budget for a New BTO? Here’s a Cost Breakdown
There is a lot to consider when buying a Build-to-Order (BTO) flat. Eligibility and locations are some of the key factors to consider but the biggest worry has to be the cost and how much buyers must set aside before they can rightfully own a BTO that they can call home. If you are a first-time homebuyer hoping to land a BTO flat, read on to find out all the costs that you need to consider before sending in your application to the Housing Development Board (HDB).
Estimated Cost for a BTO Flat
In case you are wondering what are the prices for BTO flats in Singapore, here are some indicative prices that are based on BTO launches in February and May of 2021:
| BTO Flat | Mature Estate | Non-Mature Estate |
| Two-room flat | S$117,000 to S$180,000 | S$98,000 to S$113,000 |
| Three-room flat | S$312,000 to S$419,000 | S$175,000 to S$209,000 |
| Four-room flat | S$464,000 to S$602,000 | S$260,000 to S$299,000 |
| Five-room flat | From $611,000 | S$372,000 to S$404,000 |
*Prices include the costs of floor finishes, internal doors and sanitary fittings.
To apply for a BTO flat, you do it online on HDB InfoWEB whenever there is a launch. Because there is always an overwhelming response, if you want a higher chance of getting a BTO flat, try applying for flats with lower application rates. The number of applications for each type of flat will be updated regularly on the HDB InfoWEB to ensure you’re aware of how many people you are competing with.
Check if You Are Eligible For CPF Grants
Buying a new flat can be a heavy financial commitment, which is why you should try to reduce the cost with CPF Grants as much as you can. The current grant schemes offer up to S$80,000 to eligible buyers who submitted their BTO applications after September 2019. This not only helps with buyers’ cash flow, it also reduces cash outlay.
If you are applying for a flat as a first-timer household, you may be eligible for the following depending on household income:
- Enhanced CPF Housing Grant (EHG) up to S$80,000 for household income not exceeding S$9,000 per month.
- For applications made before September 2019, buyers are eligible for the following grants instead of the Enhanced CPF Grant:
- Additional CPF Housing Grant (AHG) up to $40,000 for those with household income not exceeding S$5,000 per month and are buying two-room flexi or larger flats.
- Special CPF Housing Grant (SHG) up to $40,000 for those with household income not exceeding S$8,000 per month and are buying four-room or smaller BTO flats in a non-mature estate.
Full Cost of Buying a BTO Flat
There are myriad costs for buying a BTO flat and the following are what you need to consider when you’re planning out your budget:
1. Application fee
2. Option fee
3. Downpayment
4. Legal fees
5. Home Insurance
6. Mortgage repayments
7. Renovation and furnishing costs
| Types of Cost | Description | Estimated Amount |
| Application fee | Upfront fee for applying for a BTO flat. | S$10 |
| Option fee | An option fee must be paid to confirm the purchase; this is part of the downpayment. | S$2,000 for four-room and biggerS$1,000 for three-roomS$500 for two-room flexi |
| Downpayment | The amount payable will depend on whether you are: Taking an HDB housing loan Not taking any housing loan Taking a housing loan from a bank | 10% of the home price. Pay with CPF and/ or cash 10% of the home price. Pay with CPF and/ or cash 20% of the home price for loan ceiling of 75% (5% minimum cash payment. Remaining 15% using CPF and/or cash)20% of the home price for loan ceiling of 55% (10% minimum cash payment. Remaining 10% using CPF and/or cash |
| Legal fee | Legal fees include processing your paperwork for property ownership include: Stamp duty for Agreement for Lease Conveyancing fees Caveat registration fees Use the HDB legal fee calculator for a quick tabulation of your legal fees. | Stamp duty is calculated as: First $180,000: 1% Next $180,000: 2% Next $640,000: 3% Remaining amount: 4% You can also use the Stamp Duty Calculator from the Inland Revenue Authority of Singapore (IRAS). Conveyancing fees are calculated as: First $30,000 at $0.90 per $1,000 Next $30,000 at $0.72 per $1,000 Remaining amount at $0.60 per $1,000 The minimum conveyancing fee chargeable is $20 and it is subjected to GST. S$64.45 to be paid to the Singapore Land Authority. |
| Home Insurance | Flat owners with outstanding HDB loans must buy and renew the HDB fire insurance. | Five-year premiums (including 7% GST) range from S$2.71 for 2-room flats to S$8.10 for Executive flats |
Mortgage Repayments
When you take up a HDB housing loan, you will be granted a concessionary interest rate pegged at 0.1% above the prevailing CPF Ordinary Account (OA) interest rate and this will come up to 2.6% per annum. Note that the rate may be adjusted in January, April, July, and October, in line with CPF interest rate revisions.
However, to qualify for a HDB loan, you and the co-owners of the household must meet a list of eligibility criteria based on areas such as nationality, household status, income ceiling. As such, even though HDB loans may offer better rates, some may turn to bank loans since there are fewer restrictions.
To find the best home loans from banks, you’ll need to compare the best home loans in Singapore. You may even want to use the home loan calculator by ValueChampion to help you estimate interest costs and monthly payments.
Renovation and Furnishing Costs
Since BTO flats are new and require less work, you can certainly save more of your renovation expense. If you need a general renovation budget guide, consider setting aside the following for your BTO flat:
- S$38,850 to S$44,000 for a three-room flat
- S$43,000 to S$45,000 for a four-room flat
- S$45,000 to S$52,000 for a five-room flat
Of course, these are just estimates and how far your final bill will vary largely depends on your taste and needs.
Note: This guest post is contributed by ValueChampion Singapore
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