Since the early 90’s, Singapore has developed itself as one of the most famous destination, if you are looking for property investment. Stats say most of the people who have invested their money in Singapore property in the past have actually tripled their wealth. One of the most significant questions an investor can ask is, are the foreigners allowed to buy property in this hottest Southeast Asian city? The answer is yes, a foreigner can purchase a property in Singapore, but there are some restrictions.
Non-restricted residential properties:
Foreigners are allowed to buy:
- Constructions that are approved as a condominium development under the Planning Act
- A flat in a 6 level- building or even more with the ground level and level below the ground level that host HUDC Phase I, Phase II flats and private HUDC Phase III and IV flats.
- Leasehold estate in a residential property that is restricted for a term which doesn’t exceed 7 years and if it is granted a renewal option.
- Restricted residential properties
Foreigners are not allowed to purchase:
- A vacant land.
- Residential properties with land like bungalows, terrace homes, houses that are semi-detached.
- A residential property of a building that has less than 6 levels.
Some other restricted properties:
- HDB (Housing & Development Board) Shophouse
- HDB flat if it is purchased directly from HDB
- Resale of an HDB flat although HDB has consented to the sale
- Executive Condominium purchased under the Executive Condominium Housing Scheme Act, 1996
If you are a foreigner looking to buy restricted residential properties, you have to download a proper application form at http://www.sla.gov.sg/. Then the filled up form must be submitted along with relevant supporting documents like the entry and re-entry permits and qualifications to the address below:
Land Dealings (Approval) Unit
No. 8 Shenton Way,
#27-02 Temasek Tower,
Buying HDB property:
If you wish to buy a flat directly from HDB, you have to be a Singapore citizen; you also need to include one more Singapore citizen or Singapore permanent resident to represent a family nucleus. In case of buying flat from the resale market, the process is almost same. You should be a Singapore citizen or Singapore permanent resident.
Property investments for Permanent Resident application:
As per the Global Investor Programme (GIP), constructed by the Economic Development Board (EDB), foreigners can apply for Permanent Resident (PR) status if they agree to invest a certain amount of money in Singapore business set-ups or other investment schemes like venture capital funds, foundations or trusts that constantly work on economic development. Application for Permanent Resident status will be considered in case of private residential properties investment. A foreigner can apply for a PR status if he agrees to invest minimum S$2 million in business set-ups.
Singapore property tax:
- Buyer stamp duty has a normal stamp duty (3% – SGD 5400) for a property that is above S$360,000 along with additional buyer stamp duty of 15%.
- You have to pay for the seller stamp duty only if you wish to sell the property within 4 years from the day of purchase. The first year, the rate is 16%, but it decreases each year.
- For residential property, yearly property tax ranges from 0 – 12% of the annual value.
- For foreigners, rental income tax rate is 20%, but it will increase up to 22% beginning from the Year of assessment.
- In Singapore goods and service tax is fixed at 7%.