How To Upgrade From HDB Flat To Private Condo

Option 1: Keep HDB flat, then buy a Condo

Pros:

  • Own two properties with one for rental income (you can choose to either rent out your HDB flat or condo)
  • There is no need for you to worry about timelines as you need not move out of your current HDB flat

Cons:

  • Additional Buyer’s Stamp Duty (ABSD)
  • Buying a condo would require a substantial cash outlay
  • Condo buyers with outstanding HDB loans can only take a 45% loan for condo purchase

Option 2: Buy a Condo, then sell the HDB flat

Pros:

  • You’re able to choose your next property carefully
  • You’ll have plenty of time to renovate your new home before moving in

Cons:

  • It’s mandatory to pay Additional Buyer’s Stamp Duty (ABSD) and you can claim a refund for ABSD only if your condo purchase is a matrimonial home (i.e. buying a second residential property under husband and wife’s names, with at least one of the couple being a Singaporean citizen) and you sell the HDB flat within six months
  • The upfront financial commitment may pose a cashflow problem
  • Buying a condo would require a substantial cash outlay
  • Condo buyers with outstanding HDB loans can only take a much lower Loan To Value (LTV) for a condo purchase – this would necessitate a larger outlay for downpayment

Option 3: Sell the HDB flat, then buy a condo

Pros:

  • Additional Buyer’s Stamp Duty (ABSD)
  • You’ll have plenty of time to find the ideal new property
  • No cashflow issues
  • Ability to sell the HDB flat at a higher price now, rather than a lower price later

Cons:

  • You may need to find temporary accommodation after selling the HDB flat
  • Rental cost of alternative lodging during the transition period

Option 4: Sell the HDB flat and buy a Condo simultaneously

Pros:

  • If planned well, there’s no need to pay for Additional Buyer’s Stamp Duty (ABSD)
  • You’ll have plenty of time to find the ideal new property and renovate your new home
  • There’s no need to search for temporary accommodation

Cons:

  • This is only possible if you have proper timeline planning
  • You’ll need sufficient cash to pay the 5% Option-to-Purchase (OTP) fee and Buyer Stamp Duty
  • Your HDB flat buyer may not be willing to extend your stay