Before you invest in that 2nd property in Singapore!

Before you invest in that 2nd property in Singapore!

Looking to invest in your 2nd property in Singapore? It is definitely one of the safest paths to grow your wealth in land-scarce Singapore but like all investment, we ought to be mindful of the few key considerations before you make that fateful move.
Key Consideration #1: Eligibility to Purchase Second Property

If you are a Singaporean (Singapore Citizen)

Do note that only Singapore Citizens are allowed to own both a public housing (HDB flat) and a private property at the same time. Singapore’s HDB flats come with a 5-year Minimum Occupation Period (MOP) requirement meaning that the applicants must occupy the purchased HDB flat for a minimum of 5 years before they can sell or rent out the public housing unit. Singaporean owners of HDB flats are required by law to fulfil the MOP before they are allowed to purchase a second or subsequent property.
Conversely with effect from 30 Sep 2022, should a private property owner decide to purchase a HDB Resale Flat, he or she must dispose the private property and observe a wait-out period of 15 months before they can purchase a HDB Resale Flat.
Singaporeans who currently own private property and wish to purchase a second private property in Singapore are not subject to such restrictions.

Singapore Permanent Residents (SPRs)

While a Singaporean can purchase a second property while still retaining their ownership of the public housing, Singapore Permanent Residents (SPRs) must dispose their HDB Resale Flats within 6 months of purchasing their private property. However, SPRs who currently own private property and wish to purchase a second private property in Singapore are not subject to such restrictions.


Foreigners are not allowed to purchase Singapore public housing but are free to purchase private property. However, there is strict restriction on foreigners purchasing landed properties in Singapore as landed properties are reserved strictly for Singaporean owners.
Key Consideration #2: Taxation on Second Property

Additional Buyer’s Stamp Duty (ABSD)

In Singapore, all purchasers are subjected to pay Additional Buyer’s Stamp Duty (ABSD) when they buy a second residential property. The amount payable is dependent on the buyer’s profile at the point of purchase.
The ABSD was last adjusted on16 December 2021 as part of the property cooling measures. Current rates are reflected in the table below:
Type of Buyer ABSD Rates
Singapore Citizens buying 2nd residential property 17%
SPRs buying 1st residential property 5%
SPRs buying 2nd residential property 25%
Foreigners buying any residential property 30%
Key Consideration #3: Financing Your Second Property

Minimum cash down payment

All first residential property purchase requires only up to 5% cash down payment if the purchaser takes up a bank loan but all second property requires a 25% cash down payment of the property’s valuation limit.

Total Debt Servicing Ratio (TDSR)

The Total Debt Servicing Ratio (TDSR) framework was introduced on 28 June 2013 to prevent property purchasers from over leveraging on mortgage to finance their property purchase. Under the TDSR framework, property purchasers can only borrow to up 55% (revised on 16 Dec 2021) of their gross monthly income. The limit includes all outstanding debts you may have, like car loans, personal loans and credit card balances.
If the purchaser is already servicing an existing property mortgage loan, it will greatly affect the mortgage amount one can borrow for their second property. However, if you have already cleared the mortgage on your first home, then you’ll just need to ensure that your monthly housing loan repayments plus all other monthly financial obligations do not surpass 55% of your monthly income.

Loan-to-Value (LTV) Ratio

For first property mortgage loan, purchasers are eligible to borrow up to 75% of the property value if they are taking up a bank loan or 55% if the loan tenure is more than 30 years or extends past age 65 for borrowers. For all second housing loan, the maximum loan-to-value (LTV) ratio drops to 45% for loan tenures up to 30 years. If the loan tenure goes beyond 25 years or your 65th birthday, the LTV will drop to 30%.
For Singaporeans, SPRs, Foreigners who have existing Central Provident Fund (CPF) accounts, it is possible to use your Central Provident Fund (CPF) to buy a second property. However, if the purchaser has already used his or her CPF monies for their first property, they can only use the excess CPF Ordinary Account savings for your second property after setting aside the current Basic Retirement Scheme (BRS) of $96,000.
Source: OCBC Bank
Please contact us if you have further queries and our legal partners will be more than glad to answer your questions.

Looking For More Properties

Get in touch with us today
Call Us Now

Our Various Advisory Services

Get in touch with us today
Talk To Us