When you are planning to visit show suites with the aim of buying a property, it is very important to consider your financial position. Contrary to what many people think, your financial position is not determined by the salary you earn on a monthly basis, it is a summation of all the incomes you earn in a month. Knowing your financial position will help you to know what options you have and set a range in which you should spend when buying the house. There are many other things you should do before you start visiting new launch condo showflat, but below are the 5 must-do things before you visit the showflat.
1. Know your CPF usage
For first time buyers, the maximum CPF amount you can make use of is the total Ordinary Funds. For people buying property for the second time or more, a minimum of $75,000 should be fulfilled.
2. Housing loan
A loan Approval in Principle is one of the most important things for people looking to purchase property even though it is the most ignored step. Today, the importance of this step has been emphasized so that it is difficult for one to set a property purchase budget without it. With this, it is easy for you to know the amount the bank is able and willing to lend you for your property purchase endeavors.
3. Know your Additional Buyer Stamp Duty (ABSD)
Based on the nature of the markets today, it is important to know the ABSD category you are in. For people living in Singapore or people that are looking to buy property in Singapore, the first property will not be charged any ABSD. The taxes on the second and third properties will be 7% and 10% of the initial price of purchase respectively. The initial purchase price for permanent residents will be taxed at 5% and all the subsequent purchases will be tasked at 10%. Entities and foreigners are charged 15% tax on the purchase price of all properties they buy.
4. Understand the (NPS)
It is the most used payment scheme in all the condominium project launchings in the market today. Getting to understand more about the NPS will help you plan and organize your cash flows. Once you select and confirm the unit you wish to buy, you have to make a payment of 5% of the purchase price to the project account to get the Option To Buy (OTP). A Sales and Purchase (S&P) document will be sent to you by the developer in 2 weeks period. From the delivery of these documents, you have a time period of 3 weeks to get in touch with your solicitor, exercise the agreement and wait for another 14 days to pay ABSD and Stamp Duty. The remaining down payment of 15% should be paid in a period of 8 days from the OTP day.
Before the date of the official launch of the condominiums, a period of 2 weeks will be given for previews. Potential buyers that review the condominiums at this stage are eligible for non-obligatory seats during the show gallery. This way, you can purchase ballot units on a first come first serve basis and you will receive huge discounts during the launch.
Before you visit a condominium launch it is important to ensure you follow the steps above to ensure that your visit is productive and helpful to your aim of buying property. You should also get advice from people that have successfully bought property before to get additional tips.