Buying real estate in Singapore as a foreigner?

We've created a guide to help you avoid pitfalls, save time, and make the best long-term investment possible.

Buying property in Singapore as a foreigner: a full guide

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buying property foreigner Singapore

Everything you need to know is included in our Singapore Property Pack

Singapore is a top pick for foreigners who want to invest in real estate. It offers a modern skyline, a melting pot of cultures, and a bustling economy.

However, buying property in a foreign country can be complicated, especially with all the laws and regulations involved.

Don't worry! This guide is here to make it easy for foreign buyers to understand how the property market works in Singapore. We'll cover everything you need to know in a straightforward and simple manner.

Also, for a more in-depth analysis, you can check our property pack for Singapore.

Can you purchase and own a property in Singapore as a foreigner?

If you are American, we have a dedicated blog post regarding the property buying and owning process in Singapore for US citizens.

In Singapore, the real estate market for foreigners is distinct from that for locals, with specific regulations and limitations in place.

Here's a detailed overview to help you understand what you, as a foreigner, can buy and the rules you need to follow.

Firstly, foreigners can indeed buy property in Singapore, but there are restrictions, especially concerning land ownership.

As a foreigner, you are generally allowed to purchase condominium units or apartments in private developments without needing prior approval. These types of properties are the most accessible for foreigners.

However, when it comes to landed properties, such as bungalows or terrace houses, the rules are more stringent. Foreigners are generally not allowed to own landed properties in Singapore unless they obtain specific approval from the Singapore Land Authority.

This approval is not routinely granted and usually requires the foreign buyer to make significant contributions to the economic, scientific, or technological development of Singapore.

There are no distinctions based on your country of origin. The rules for buying property in Singapore apply equally to all foreigners, regardless of nationality. This ensures a level playing field for all foreign investors or homebuyers.

Regarding residency, you do not need to be a resident of Singapore to purchase property there. Many foreigners buy property in Singapore as an investment or as a second home.

However, if you're looking to purchase public housing (HDB flats), which is typically reserved for Singapore citizens and permanent residents, different rules apply.

In terms of visas or permits, there is no specific visa requirement for buying property.

Owning property in Singapore does not grant you any special residential status. If you plan to live in the property you purchase, you'll need to obtain the appropriate visa or residency permit through the usual channels, separate from the property purchase process.

As for governmental authorization, besides the mentioned requirement for landed property, buying a condominium or an apartment usually doesn't require special approval.

Regarding minimum investment, there is no specified minimum investment for foreign buyers in most cases.

However, you should be aware that the government imposes an Additional Buyer's Stamp Duty (ABSD) on foreigners, which is a significant additional tax on top of the standard buyer's stamp duty. This ABSD rate is higher for foreigners compared to locals or permanent residents.

Can you become a resident in Singapore by purchasing and owning a property?

Purchasing property in Singapore does not automatically grant you residency.

Unlike some other countries that offer residency or citizenship through investment in real estate, Singapore does not have a direct "property investment for residency" program.

Owning property in Singapore is independent of your residency status, and buying a house or apartment there won't directly lead to permanent residency or citizenship.

However, Singapore does offer a program called the Global Investor Programme (GIP), which can lead to permanent residency. This program is designed for high-net-worth individuals who intend to drive their businesses and investment growth from Singapore.

Under the GIP, you can invest in a business or a GIP fund that invests in Singapore-based companies. It's important to note that this is not a straightforward real estate investment program. The focus is on broader economic contributions.

The GIP has specific criteria, including a substantial business track record and a successful entrepreneurial background.

As for the investment, you're typically required to invest a minimum amount (which has been in the range of several million Singapore dollars) in either a new business entity or in the expansion of an existing business in Singapore. Alternatively, you can invest a similar amount in a GIP-approved fund.

The GIP can eventually lead to permanent residency in Singapore. After maintaining your investment for a certain period (usually a few years) and fulfilling certain conditions, you can apply for permanent residency.

This residency is not automatically granted; it's subject to review and approval by the Singapore government.

Regarding citizenship, having permanent residency status is one of the prerequisites for applying for Singaporean citizenship.

However, acquiring citizenship involves additional criteria and is a separate process from the GIP. Factors like the duration of your permanent residency, your integration into Singaporean society, and your commitment to staying in Singapore play a crucial role in the citizenship application process.

The number of people who have used the GIP is not widely publicized, but it's known to be a selective program with a limited number of applicants each year.

The Singaporean government is quite stringent in its selection process, focusing on applicants who can contribute significantly to the country's economic growth.

Thinking of buying real estate in Singapore?

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Market data

You can find fresh and updated data in our pack of documents related to the real estate market in Singapore.

By examining the the the GDP per capita indicator, we can see that Singaporean people have become 9.9% richer throughout the past 5 years.

As people's wealth grows, the demand for real estate could rise, resulting in potential price increases down the road.

Looking at the data reported by Numbeo, we can see that residential properties in Singapore offer yields between 2.6% and 5.3%.

These moderate rental yields indicate a balanced return on investment for property owners or investors

To know more, you can also read our dedicated article: is it a good time to buy a property in Singapore?

Daily life of an expat

The life of an expat in Singapore is vibrant and full of opportunity. Singapore is a cosmopolitan city with a diverse and welcoming population, making it an ideal place for expats to call home.

Expats in Singapore can enjoy a range of cultural attractions, from the iconic Singapore Zoo and Gardens by the Bay to the renowned Singapore Flyer and the world-famous Marina Bay Sands. Expats can also take advantage of Singapore's world-class healthcare, education, and transportation systems. Singapore is a great place to live, work, and play, and the expat community is vibrant and welcoming.

Singapore is especially renowned for its food and culinary scene, and expats can enjoy a wide range of cuisine from all over the world. There are plenty of restaurants, cafes, and bars to explore, and the nightlife is vibrant and exciting. Expats can also explore Singapore's many shopping malls and markets, which offer a wide range of international and local products. Singapore is also home to numerous parks, beaches, and other outdoor activities, making it a great place to spend time outdoors.

The cost of living in Singapore is relatively high, but expats can benefit from a range of tax breaks and other financial incentives. Expats can also enjoy a range of social activities, from networking events to sports teams and clubs. Singapore is a great place for expats to make new friends and explore new cultures and experiences. Overall, life as an expat in Singapore is full of opportunity and excitement.

What are the best places to invest in real estate in Singapore?

This table summarizes some of the best places to buy a property in Singapore.

City / Region Population Average Price per sqm (SGD) Strengths
Downtown Core ≈ 7,900 15,000 - 30,000 Central business district, iconic landmarks, vibrant city life
Orchard ≈ 4,400 18,000 - 35,000 Shopping district, luxury residences, dining and entertainment
Marina Bay ≈ 8,600 20,000 - 40,000 Waterfront development, skyline views, integrated resorts
Jurong East ≈ 81,000 10,000 - 20,000 Regional center, business and leisure amenities, green spaces
Tampines ≈ 231,000 8,000 - 15,000 Residential town, shopping malls, recreational facilities
Woodlands ≈ 252,500 7,000 - 12,000 Northern residential town, nature parks, connectivity to Malaysia
Sentosa ≈ 1,100 25,000 - 50,000 Island resort, luxury residences, beaches, entertainment

Do you need a lawyer to buy real estate in Singapore?

When you purchase a property in Singapore, a local lawyer can assist you by guiding you through the legal process and ensuring that everything is done correctly.

For example, they can help you prepare a Sales and Purchase Agreement, which is a legally binding document between the buyer and seller that outlines the terms of the sale.

The Singaporean lawyer can also facilitate the proper completion of the property transaction, including the transfer of ownership and registration of the property.

They will ensure that all necessary taxes and fees related to the purchase are paid accurately and on time. Additionally, the lawyer can provide valuable insights into Singapore's property laws and regulations, ensuring compliance with legal requirements.

What are the risks when purchasing a property in Singapore?

We've got an article dedicated to the risks associated with purchasing property in Singapore.

1. Ethnic Integration Policy (EIP) and Singapore Permanent Resident (SPR) Quota:

Singapore has implemented an Ethnic Integration Policy (EIP) and a Singapore Permanent Resident (SPR) quota to promote racial harmony and maintain a balanced ethnic mix in housing estates. Buyers may face restrictions on purchasing properties in certain areas if they do not meet the EIP requirements or if the SPR quota has been reached.

2. Additional Buyer's Stamp Duty (ABSD):

Singapore imposes Additional Buyer's Stamp Duty (ABSD) on certain categories of property buyers, such as foreigners and entities. The ABSD rates vary depending on the buyer's residency status and the number of properties they already own. Buyers should factor in the additional cost of ABSD when budgeting for their property purchase.

3. En-Bloc Risks:

In Singapore, en-bloc sales refer to the collective sale of an entire strata-titled development to a developer. While en-bloc sales can be lucrative for property owners, buyers of such properties may face risks. The en-bloc process involves multiple legal and financial considerations, and the success of the sale is subject to various factors, including the approval of a supermajority of owners and regulatory authorities.

4. Restrictive Property Loan Measures:

The Monetary Authority of Singapore (MAS) has implemented property loan measures to manage systemic risks and curb excessive borrowing. These measures include loan-to-value limits, loan tenor restrictions, and borrowing caps. Buyers may face challenges in securing financing or may have to adhere to stricter loan conditions, affecting their purchasing power and options.

5. Building and Construction Quality:

While Singapore has stringent regulations and building standards, there have been occasional cases of building defects or construction issues. Buyers should conduct thorough inspections and due diligence before purchasing a property, including engaging professional services to assess the structural integrity and quality of the building.

6. Limited Land Supply:

Singapore is a small city-state with limited land supply. As a result, property prices in desirable locations can be relatively high, and finding affordable options may be challenging. Buyers should carefully consider their budget and location preferences, as well as potential future developments and infrastructure plans that could affect the value and livability of the property.

7. Urban Redevelopment Authority (URA) Guidelines:

The Urban Redevelopment Authority (URA) regulates various aspects of property development, including building height limits, land use zoning, and development guidelines. Buyers should familiarize themselves with URA guidelines and restrictions, as these can affect the property's potential for future redevelopment or alterations.

8. HDB Ownership Restrictions:

The Housing and Development Board (HDB) provides public housing in Singapore, but there are certain restrictions on ownership. Non-citizens and non-permanent residents can only buy specific types of HDB flats under specific conditions. Buyers should be aware of these restrictions if they are considering purchasing an HDB flat.

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Everything you need to know is included in our Singapore Property Pack

What are the required documents for a real estate transaction in Singapore?

When buying a property in Singapore, the following documents are required:

1. Option to Purchase (OTP) – signed by both buyer and seller, this document is a legally binding contract that states the buyer’s intention to purchase the property as well as the terms and conditions of the sale.

2. Sale and Purchase Agreement (SPA) – this document formalizes the terms and conditions of the sale and outlines the responsibilities of both the buyer and the seller.

3. Memorandum of Transfer (MOT) – this document is prepared by the seller’s lawyer and contains the details of the buyer and seller, the property being sold, and the terms of the sale.

4. Certificate of Title (CT) – this document is issued by the Singapore Land Authority and states the ownership of the property.

5. Tenancy Agreement – if the property is leased, this document is needed to formalize the terms of the lease.

We review each of these documents and tell you how to use them in our property pack for Singapore.

How can you approach negotiations with individuals from Singapore?

When purchasing a property in Singapore, it is crucial to understand and respect the cultural norms and expectations of the locals.

  1. Politeness and Respect:
    • Singaporeans value politeness and respect in their interactions. It is important to greet others with a smile and a handshake, especially in formal settings.
    • Address individuals using their proper titles, such as "Mr." or "Ms.," followed by their last name. In more informal situations, it is common to use first names.
    • Showing respect for elders and authority figures is highly regarded in Singaporean culture. Use "Uncle" or "Auntie" as polite terms to address older individuals, even if they are not related.
  2. Multiculturalism and Diversity:
    • Singapore is a multicultural society with a mix of different ethnicities and religions. Embrace and appreciate this diversity.
    • Avoid making assumptions or generalizations based on someone's ethnicity or religion. Treat everyone as an individual.
    • Understanding and respecting different cultural practices and beliefs is important to foster positive relationships. For example, during festive periods like Chinese New Year or Hari Raya, it is customary to exchange greetings and well wishes.
  3. Punctuality and Efficiency:
    • Singaporeans place a high value on punctuality and efficiency. It is important to be on time for meetings and appointments.
    • Avoid causing delays or wasting time during business discussions. Keep the conversation focused and concise.
    • When attending property viewings or meetings, it is advisable to plan your transportation ahead of time, considering Singapore's efficient public transport system.
  4. Gift-Giving:
    • In Singapore, gift-giving is not expected in business settings. However, if you choose to give a gift, ensure it is modest and appropriate.
    • Consider items such as local snacks, tea, or small souvenirs that represent Singaporean culture or landmarks.
    • When presenting a gift, offer it using both hands as a sign of respect.
  5. Respect for Rules and Regulations:
    • Singapore has strict laws and regulations regarding property ownership and transactions. Familiarize yourself with these regulations and seek legal advice when necessary.
    • Be diligent in understanding the terms and conditions of any contractual agreements before entering into them.
    • Ensure compliance with government policies and guidelines, such as the Additional Buyer's Stamp Duty (ABSD) for certain property buyers.

Are bank loans available to foreign nationals in Singapore?

Yes, foreigners can obtain property loans in Singapore. The Singaporean banking system allows non-residents to apply for property loans, subject to certain conditions and requirements.

To obtain a property loan in Singapore as a foreigner, you may consider options like the Mortgage Servicing Ratio (MSR) and Total Debt Servicing Ratio (TDSR) requirements, which determine the loan amount based on your income and existing debts.

DBS Bank, OCBC Bank, and United Overseas Bank (UOB) are among the Singaporean banks that are capable of providing mortgages to non-residents.

Additionally, in Singapore, mortgage rates for a 20-year term range between 1% and 5%, which are considered highly favorable.

What are the taxes related to a property transaction in Singapore?

Here is a breakdown of taxes related to a property transaction in Singapore.

Tax Description Calculation Who pays
Property Tax Annual tax on the value of property owned A progressive scale applied to residential properties and 10% to all other properties Owner
Additional Buyer's Stamp Duty (ABSD) Additional tax on property purchases 5% to 65% based on the buyer's profile and number of properties owned Buyer
Seller's Stamp Duty (SSD) Tax on property sold within a specific holding period Progressive rates ranging from 0% to 16% based on the holding period and property value or sale price Seller
Buyer's Stamp Duty (BSD) Tax on property purchase Progressive rates ranging from 1% to 6% based on the property value or purchase price Buyer
Rental Income Tax Tax on rental income generated from the property 20% on the rental income for foreign citizens Owner

For a more detailed calculation, refer to:
- the Singapore Government's website
- the Inland Revenue Authority of Singapore (IRAS)'s website
- the Inland Revenue Authority of Singapore (IRAS)'s website
- the Ministry of Finance, Singapore's website

What fees are involved in a property transaction in Singapore?

Below is a simple breakdown of fees for a property transaction in Singapore.

Fee Description Calculation Who pays
Legal Fees Legal fees associated with the property transaction Between S$1,300 and S$3,000 for a property sale or purchase transaction Seller and/or Buyer
Real Estate Agent's Commission Fee paid to real estate agent or broker 2% to 5% of property sale price, depending on type of property and urgency of seller Seller

Buying real estate in Singapore can be risky

An increasing number of foreign investors are showing interest in Singapore. However, 90% of them will make mistakes. Avoid the pitfalls with our comprehensive guide.

buying property foreigner Singapore