Guidelines at singaporetour.wixsite.com says that you have one of two options to buy property in Singapore. You can either make use of a freehold or a leasehold tenure. With the freehold tenure, you have the right to hold the property in perpetuity. The leasehold tenure on the other hand entails the transfer of possession of the property to the purchaser for the total period of the lease.
One of the first things you should look into when you decide to purchase a property is to get an option to purchase form. This form is gotten as soon as you pay one percent of the purchase price to the seller. This agreement is normally drawn up by the seller or their property agent. After you have made the payment, you will have 14 days to go through with the purchase. During this time, you will have to sign the option to purchase and take it back to the seller along with an already agreed upon percentage of the purchase price (normally 4-9%). There are times however, when this process if done in reverse. This means that the purchaser draws up an offer to purchase and passes it along to the seller who then has the option to agree and sign it.
The property purchase process of property in Singapore is as follows;
- First of all, it is recommended that you make use of a property agent. Such an agent needs to be experienced and competent enough to satisfy your needs. You need to inform the agent if exactly the type of property you wish to buy. This way, he or she can find the right property for you. In addition to fining you the property, a good agent needs to be able to act as your consultant should the need arise for legal or financial advice upon purchase.
- The agent with the help of the explanations you provide will then proceed to find you your ideal property. You will be presented with a list of potential properties that require your viewing.
- When you land on the property that interests you, then you will need to make contact with the seller or their estate agent to express your interest and comes to terms with the price.
- Once the price has been agreed upon, then what is known as an “Option to Purchase” will have to be drawn. As mentioned above, when you pay 1% of the price, you are given the exclusive right to purchase the given property for a period of 14 days.
- In addition to the 1%, the Option to Purchase may also include an indication of when the next deadline is to pay up to 10% of the price. The payment helps assure the seller that you are a serious buyer. Normally, the signed option is forwarded together with this sum.
- The next step is for your lawyer to prepare the documents needed for the property transfer. The lawyer should be in position to advise you on the amount of money that you need to pay in order for the sale to be complete.
- Last but not least, you need to look into paying property tax for the property that you have bought. The property tax needs to be filed annually after you have gained ownership of the property. The amount of money that has to be paid is calculated when the annual value of the property is multiplied with the tax rate. The estimated annual rent of your property is taken from the Annual value or AV. Normally, the tax rate is slotted at 10% annually, however, you do have the option to apply for a 4% rate in case you occupy the property yourself.