Upgrading to a condo in Singapore is a major life and financial milestone. For many, it’s a symbol of progress—a move from public housing to private property. But behind the prestige lies a complex web of costs, long-term commitments, and lifestyle trade-offs. If you’re considering making the jump from an HDB flat to a condominium in Singapore, financial planning isn’t optional—it’s essential.
This guide walks you through the key financial planning steps you must take to ensure your condo upgrade doesn’t stretch your budget or hurt your long-term goals.
1. Understand Your Financial Position Before You Start
Before anything else, assess your current financial health. This includes:
- Your monthly household income and stability of employment
- Existing loans and liabilities (car loans, credit cards, study loans)
- Your CPF balance and available cash savings
- How much you can realistically afford for upfront payments and monthly instalments
The cost of upgrading to a condo in Singapore is significant. It’s not just the condominium price in Singapore that matters—it’s also the hidden and recurring costs like stamp duties, renovation, moving, and monthly maintenance fees. Get clarity on what you can comfortably afford without compromising emergency savings or retirement plans.
2. Budget for Upfront Costs and Stamp Duties
You’ll need to prepare for several one-time payments before even securing your new home:
- Option fee and down payment: Most banks finance only up to 75% of the purchase price, so you’ll need to put down at least 25% (a portion in cash, the rest via CPF).
- Legal and conveyancing fees: This can range from $2,500 to $4,000.
- Buyer’s Stamp Duty (BSD): Payable on all property purchases, and calculated as a percentage of the property price.
- Additional Buyer’s Stamp Duty (ABSD): If your HDB hasn’t been sold before buying the condo, you’ll be treated as owning a second property. This can trigger ABSD of 17% or more.
To avoid unnecessary ABSD, consider selling your flat first, or ensure your transition falls within the necessary exemption windows. Don’t let these charges catch you off guard—they’re often left out in budgeting conversations, yet they can add tens of thousands to your initial outlay.
3. Factor In the Minimum Occupation Period (MOP)
If you’re still within your Minimum Occupation Period, you won’t be eligible to sell your HDB flat or buy private property without penalties.
Make sure you’ve completed your 5-year MOP before starting your condo search. If you haven’t, you may need to delay your plans or explore other interim options such as Executive Condominiums, which follow different rules.
Also note: if you plan to hold both properties temporarily, you’ll need substantial liquidity—and you’ll likely face ABSD unless exemptions apply. Timing your sale and purchase carefully around MOP can save you a large amount of money.
4. Compare Loan Options Carefully
Once you’re ready to finance the condo, compare mortgage packages from different banks. HDB loans have a fixed interest rate of 2.6%, but condominium in Singapore purchases require private bank loans with floating rates—currently ranging from 3% to 4% depending on market conditions.
What to look at:
- Interest rates: Choose between fixed and floating, depending on your risk tolerance
- Loan tenure: Longer tenures reduce monthly payments, but increase total interest paid
- Loan-to-Value (LTV) limit: Banks typically lend up to 75%, assuming no existing loans
- Total Debt Servicing Ratio (TDSR): Your loan repayments must not exceed 55% of your gross monthly income
Engage a mortgage broker if needed – they can help assess your credit profile and secure better rates. A small difference in interest rate can save you thousands over a 25- or 30-year loan.
5. Account for Monthly Recurring Costs
Owning a condo means committing to higher recurring expenses compared to HDB living. These include:
- Mortgage instalments: This will likely be higher than your previous HDB loan
- Condo maintenance fees: Ranging from $250 to $600/month depending on property size and facilities
- Utilities: Larger or high-floor condos may lead to increased bills
- Insurance: Fire insurance, home content insurance, and mortgage insurance may all be required
You’ll also need to budget for longer-term maintenance, repairs, and potential upgrading projects over the years. If you’re stretching to afford the monthly costs, consider whether this is the right time to upgrade or if it would be wiser to wait and save more.
6. Evaluate the Resale Market and Long-Term Returns
While upgrading to a condo in Singapore is often seen as a good investment, not all condos appreciate equally. The private property market trend has seen fluctuations, especially for condos outside prime districts or with shorter leases.
Ask yourself:
- Is the condo located in an area with strong rental or resale demand?
- Are there upcoming developments (MRT stations, malls, schools) nearby?
- Is the launch price already at a peak, or is there room for appreciation?
Buying a condo purely for capital gains is risky, especially if you’re over-leveraged. Make sure your upgrade also meets your personal housing needs, not just speculative investment goals.
7. Don’t Rush to Give Up Space for Status
It’s tempting to make the leap simply to “level up” in lifestyle. But giving up HDB space for condo status in Singapore might mean compromising on livability—especially if you’re moving into a smaller unit just to stay within budget.
Think about your daily routines. Will you feel comfortable downsizing bedrooms, storage, or kitchen space? Will you actually use the condo’s amenities enough to justify the higher fees?
If your current HDB offers space, convenience, and financial stability, ask whether now is the right time to make the move—or if waiting a little longer would allow you to afford a condo that truly meets your needs.
8. Always Maintain a Safety Buffer
Lastly, never commit all your cash and CPF savings to the condo purchase. Always leave a financial buffer for emergencies, job transitions, or unexpected expenses. Financial advisors typically recommend setting aside at least 6 months’ worth of expenses—even more if you’re self-employed or supporting dependents.
A condo purchase that eats into your safety net can leave you exposed to unnecessary financial stress. Remember: owning a condo should feel like an upgrade, not a burden.
Final Thoughts
Upgrading to a condo in Singapore is more than just a lifestyle change—it’s a long-term financial commitment. With rising condominium prices in Singapore and a volatile global economy, it’s more important than ever to plan smart, understand every cost, and avoid emotional decisions.
Before you give up your HDB space for condo status in Singapore, run the numbers, assess your long-term stability, and speak with professionals who can guide you through financing, legal obligations, and market risks. Done right, the upgrade can be a fulfilling step forward—not just in property, but in life.
Paul Grewal is a seasoned home mortgage consultant based in Singapore, renowned for his strategic finesse and deep market insights. With over a decade of experience, he specialises in helping clients navigate the complexities of property investment and refinancing home loans. Paul’s approach is highly personalised, ensuring that his clients secure the best possible terms and mortgage loan interest rates in Singapore tailored to their unique financial situations. An avid writer, he contributes regularly to leading financial publications, offering advice on smart property investment and financial planning. His workshops on financial literacy are highly sought after, reflecting his commitment to empowering homeowners in Singapore. The blog deals with practical financial planning advice for upgrading to a condo in Singapore, helping buyers navigate costs, loans, and long-term affordability.
