{"id":9689,"date":"2017-11-04T02:18:27","date_gmt":"2017-11-03T18:18:27","guid":{"rendered":"https:\/\/www.99.co\/blog\/singapore\/?p=9689"},"modified":"2022-07-01T04:06:35","modified_gmt":"2022-06-30T20:06:35","slug":"hidden-property-costs","status":"publish","type":"post","link":"https:\/\/www.99.co\/singapore\/insider\/hidden-property-costs\/","title":{"rendered":"5 hidden property costs that can bleed you dry when buying a home"},"content":{"rendered":"<div id=\"bsf_rt_marker\"><\/div><p><span style=\"font-weight: 400;\">If you\u2019ve finally found your dream home after spending what seems like an eternity in the searching process, congrats! You\u2019re that much closer to being a homeowner, but don\u2019t forget to budget properly, and take into account the following hidden property costs that could just turn your dream home into a money-hemorrhaging nightmare. <\/span><\/p>\n<figure id=\"attachment_9693\" aria-describedby=\"caption-attachment-9693\" style=\"width: 800px\" class=\"wp-caption alignnone\"><img decoding=\"async\" class=\"wp-image-9693\" src=\"https:\/\/www.99.co\/singapore\/insider\/wp-content\/uploads\/2017\/04\/hidden-property-costs.jpg\" alt=\"Be careful of these hidden property costs that can drive up the amount you need to pay!\" width=\"800\" height=\"400\" srcset=\"https:\/\/www.99.co\/singapore\/insider\/wp-content\/uploads\/2017\/04\/hidden-property-costs.jpg 1600w, https:\/\/www.99.co\/singapore\/insider\/wp-content\/uploads\/2017\/04\/hidden-property-costs-940x470.jpg 940w\" sizes=\"(max-width: 800px) 100vw, 800px\" \/><figcaption id=\"caption-attachment-9693\" class=\"wp-caption-text\">Be careful of these hidden property costs that can drive up the amount you need to pay!<\/figcaption><\/figure>\n<h3><strong>Hidden property cost 1: Option Fee and Option Exercise Fee<\/strong><\/h3>\n<p><span style=\"font-weight: 400;\">The option fee refers to the Option to Purchase (OTP) &#8211; once you\u2019ve paid this fee, the sellers are \u201clocked in\u201d, in other words contractually required to make the property available to you. This is typically 1 percent of the property\u2019s purchase price, with the maximum amount being $1,000. On top of the option fee, you\u2019ll also have to pay the option exercise fee when you exercise your OTP. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">For example, assume you\u2019re paying $400,000 for a resale flat. Since 1 percent of $400,000 exceeds $1,000, you\u2019ll only need to pay an option fee of $1,000. Your option exercise fee is negotiated between you and the seller, but the sum of your option exercise fee and your previously paid option fee cannot exceed $5,000, which means that you\u2019ll be forking out an extra $4,000, maximum.<\/span><\/p>\n<h3><strong>Hidden property cost 2: Stamp Duty and Additional Buyer Stamp Duty<\/strong><\/h3>\n<p>Stamp duty is a tax on documents related to property in Singapore, and the amount you\u2019ll need to pay is calculated based on the property\u2019s purchase price:<\/p>\n<p><span style=\"font-weight: 400;\">1% for the first S$180,000<\/span><\/p>\n<p><span style=\"font-weight: 400;\">2% for the next S$180,000<\/span><\/p>\n<p><span style=\"font-weight: 400;\">3% for the remainder of the purchase price <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Again, assuming that you\u2019re paying $400,000 for your resale flat. Your stamp duty will be calculated as follows:<\/span><\/p>\n<p><span style=\"font-weight: 400;\">1 percent of $180,000 = $1,800<\/span><\/p>\n<p><span style=\"font-weight: 400;\">2 percent of $180,000 = $3,600<\/span><\/p>\n<p><span style=\"font-weight: 400;\">3 percent of the remaining $40,000 = $1,200<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In total, you\u2019ll be paying $6,600 of stamp duty. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Have more than one property under your name? In that case, you\u2019re required to pay for an <\/span><a href=\"https:\/\/www.iras.gov.sg\/irashome\/Other-Taxes\/Stamp-Duty-for-Property\/Working-out-your-Stamp-Duty\/Buying-or-Acquiring-Property\/What-is-the-Duty-that-I-Need-to-Pay-as-a-Buyer-or-Transferee-of-Residential-Property\/Additional-Buyer-s-Stamp-Duty--ABSD-\/\"><span style=\"font-weight: 400;\">Additional Buyers Stamp Duty (ABSD)<\/span><\/a><span style=\"font-weight: 400;\">, with the amount payable dependent on whether you\u2019re a citizen, permanent resident, or foreigner, as well as the number of residential properties that you own. <\/span><\/p>\n<h3><strong>Hidden property cost 3: Legal and valuation fees<\/strong><\/h3>\n<p><span style=\"font-weight: 400;\">Legal fees: You\u2019ll have to engage a lawyer who will conduct background checks on the property, and also transfer the property\u2019s ownership title. This will set you back by approximately 0.4 percent of the property price. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Valuation fees: Your valuation fee is pretty self-explanatory &#8211; it\u2019s what you pay to get your property valued, and typically costs between $300 to $500. What to know the objective of getting your property valued, or what factors influence the decision making process? Read <\/span><a href=\"https:\/\/www.99.co\/singapore\/insider\/property-valuation-priority\/\"><span style=\"font-weight: 400;\">this guide<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/p>\n<h3><strong>Hidden property cost 4:\u00a0Maintenance fees<\/strong><\/h3>\n<p><span style=\"font-weight: 400;\">Purchasing a unit at a condominium? Don\u2019t forget to take into account your monthly maintenance fee, which ranges from around $150 to $600 depending on how swanky the condo\u2019s amenities are. For more information on how these fees are calculated, here\u2019s a <\/span><a href=\"https:\/\/www.99.co\/singapore\/insider\/sinking-fund-maintenance-fund-and-service-charge\/\"><span style=\"font-weight: 400;\">handy guide<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/p>\n<h3><strong>Hidden property cost 5:\u00a0Renovation fees<\/strong><\/h3>\n<p><span style=\"font-weight: 400;\">Don\u2019t get taken in by the listicles you see on Facebook advertising beautiful apartments that were designed and built on a shoestring budget. The $30,000 &#8211; $40,000 price tags that you see in these articles typically include only basic renovation costs, and do not reflect the real amount you\u2019ll be forking out.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">More specifically, on top of your basic renovation costs, you\u2019ll need to spend on additional costs such as installing air-con units, window grills, electrical works, and more. You\u2019ll even need to pay a haulage fee to get contractors to dispose of the remnants from hacking. Add in your furniture costs, and you should be budgeting $50,000 &#8211; $70,000 at the bare minimum.<br \/>\n<\/span><br \/>\n<span style=\"font-weight: 400;\">Without a comprehensive budget planned out, it\u2019s likely that you\u2019ll encounter a lot of stress throughout the process of buying your home. If you ask us, it\u2019s far better to opt for a smaller and more affordable apartment if this means that your finances won\u2019t be stretched thin. Good luck! <\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Budget properly when purchasing property, and take into account the following hidden property costs that can cause you to bleed money.<\/p>\n","protected":false},"author":36,"featured_media":54694,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"","_relevanssi_noindex_reason":"","_lmt_disableupdate":"no","_lmt_disable":"","_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[53593,53589,57131,53590],"tags":[],"persona":[],"class_list":{"2":"type-post","11":"entry","12":"has-post-thumbnail"},"acf":[],"yoast_head":"<!-- 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