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How much will it Cost to Buy Real Estate in Singapore?

A first home will definitely be the most important purchase most of us will make. So how much it costs to buy a property in Singapore and what would be the total cost to complete a real estate deal? Let’s give you a brief idea about this.

Real Estate in Singapore

Average Prices:

Many believe the real estate market in Singapore is one of the most expensive ones in the world. That’s why initially it would look very difficult to find a good property at a reasonable price in this Southeast Asian city. But the good news is, despite the real estate prices in Singapore are falling they are enjoying a pick time since 2013. So, if you want to buy a property here, it’s the perfect time to strike the deal.

But you have to keep in mind several hidden costs are there behind every successful real estate deal. The most important three are the following:

  1. The purchase price
  2. The cost of a bank loan
  3. Homeowners insurance

The purchase price will be the paying one when buying, but the cost of bank loan and homeowners insurance will follow significantly after the purchase. Here we have tried to break down each of the three costs.

The Purchase Price:

  • Most of the properties in Singapore are sold for between S$400 per square foot and S$2,000 per square foot. In case of landed property (real estate with land ownership), the price will be the most while apartments, without any land ownership, can be bought for around S$400 per square foot.
  • An HDB apartment of 462 square foot including one bedroom and one bathroom will cost around S$200,000. But if you have a family of four members this is too small, a larger house with more bedrooms will be the best option for you. In case of landed properties with 3 bedrooms, the starting price will be S$300,000.

The Cost Of A Bank Loan:

  • Most of us don’t have S$300,000 in the bank account ready to be used anytime. So, people looking to buy real estate properties prefer a bank loan. What are the best home loans in Singapore? Recent market research states that most people pay between 0.72% and 1.59% per year for a 30-year mortgage.
  • For a 30-year home loan at 1.59% will cost you S$12,576 in principle along with interest each year. Over the entire time span of your loan, the cost would climb up to S$377,412. Keep in mind the property in this example costs S$300,000. You have to pay an extra S$77,412 in interest payments if you go for a bank loan.

Homeowners Insurance:

  • If the property you have bought is financed through the bank, there is a strong possibility that the bank will need you to have homeowners insurance. There have been many previous cases where the bank held this insurance and charged the consumer a monthly fee. The bank demands this insurance as technically they own the property you have bought. In case of a house fire or even a flood, you would lose the entire value of the home; it leaves the bank without any collateral to support the home loan.
  • Even if you decide to self-finance while purchasing a property in Singapore, homeowner’s insurance could become a wise decision in the future. You have to remember that a homeowner’s insurance most of the time will cover items within the house apart from the fixtures, walls, and windows.

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