Remember the 90s Singapore Property Craze?
Back in the day, Singapore’s house‑hunting crowd had a pretty simple mantra: “Buy a home, rent it out, use that rent to snag the next one.” Each purchase was like a domino, making the next step a breeze. Those were the golden days for the savvy property investor.
Fast‑Forward to Today: The ABSD Reality Check
Now the scene has changed because of the Additional Buyers Stamp Duty (ABSD). This hefty tax bite has pinched the cycle, turning the easy rent‑back strategy into a costly game. The silver lining? Your very first home can actually feel a tad cheaper because the tax kicks in only once you go for that second property. The downside, though, is the steep price tag that can bite when you finally decide to grow that portfolio.
What the Numbers Look Like After the December 2021 Cool‑Down
Below are the key changes that have come into play. (We’ve stripped out the table format and laid it out in plain text for a smoother read.)
- Loan‑to‑Value (LTV) Ratio
- HDB loans: 90% → 85%
- Bank loans: 75% → 75%
- Total Debt Servicing Ratio
- Monthly income: 60% → 55%
- ABSD Rates (Clean, no extraities)
- Singapore Citizens
- First property: None → None
- Second property: 12% → 17%
- Subsequent: 15% → 25%
- Permanent Residents
- First property: 5% → 5%
- Second property: 15% → 25%
- Subsequent: 25% → 30%
- Foreigners: 20% → 30%
- Entities: 25% + 5% → 35% + 5%
- Singapore Citizens
Ways to Legally Dodge the ABSD (2022 Edition)
Feeling the crunch? Here are some real‑world, no‑BS ideas to get around that ABSD wall:
- Go for an Executive Condominium – Great for those looking to upgrade without stepping up the tax.
- Decouple your property deal – If the cost stays below the ABSD threshold, you can keep that rate at bay.
- Purchase through a Trust – Handy if you’re holding a healthy cash stash; trusts can offer some tax relief.
- Sell one, buy two – Clever timing has you off the first‑time tax cycle, turning your 1‑flat into 2.
- Take a dual‑key unit – Own one but rent out the other; the rental income might cushion the tax impact.
- Opt for a commercial property – They bring a different set of tax rules and often come with more flexible usage.
Bottom line? The ABSD landscape has hardened the path to multiple properties, but with a bit of strategy, you still have a bright future on the property ladder. Happy hunting!
1. Buy an Executive Condominium (for upgraders)
Upgrading Apartments? Get a Grin Before You Pay the ABSD
Ever felt the sting of the Additional Buyer Singapore Property Duty (ABSD) even when you’re just trying to upgrade your living space? Let’s break it down.
Why the ABSD Still Hits
- Even if you have no plan to own two homes, the tax still rolls in. It’s a “buy‑twice” penalty.
- Hefty rates: 17 % for non‑PPOs, 25 % if you’re a Permanent Resident.
- Cash or CPF? Either way, you’ll need the funds on the spot.
Good news? It only applies to private condos. If you choose a new Executive Condominium (EC), you can skip the initial ABSD payment.
The EC Advantage
- No upfront ABSD tax – a sweet relief for your wallet.
- Still, you must dispose of your old flat within six months if you’re buying an EC.
- Stamp duties, including ABSD, can be paid from your CPF, so you’ll still have options.
So, next time you’re eyeing an upgrade, think: Do I want the quick ABSD burn or the EC’s smoother path?
It’s all about the cash flow and your housing goals.
ABSD Payment Secrets: CPF Rules & When Cash Takes the Stage
What’s the Deal with ABSD?
ABSD (Additional Buyer’s Stamp Duty) can feel like a hidden fee that pops up when you’re thinking about buying a new place. Don’t let it catch you off-guard – here’s how to smooth the process.
1⃣ New Development: CPF is Your Power‑Up
- Instant CPF Access: If you’re snagging a brand‑new development, the Central Provident Fund (CPF) is ready to roll right out the gate.
- Why it’s a Win: You can use your CPF savings straightaway, so you avoid the hassle of a large upfront cash payment.
2⃣ Resale Property: The Cash‑First Challenge
- Dust Off the Cash Register: For a resale property, you’ll need to pay the ABSD in full with cash (or a qualified payment method) before the lawyer gets involved.
- Why the Play‑by‑Rules?: Old‑school property markets still love their paper money – it’s a bit like a dance where the cash steps first.
Step‑by‑Step: From Seller to CPF‑Paying Owner
- Secure the Legal Ownership
- Apply for CPF Migration
First, feel the thrill of becoming the legal owner. Once the deed is in your name, you’ve set the stage for the next act.
After you’re officially “owner of the house”, you can file to move the ABSD payment into your CPF account. Think of it as swapping a cash ticket for a digital one.
Quick Tips to Keep Your Finances Smooth
- Check CPF eligibility limits before you apply—yes, even your CPF account has a ceiling.
- Hire a lawyer early if you’re dealing with resale: they can guide you through the cash-first maze.
- Keep refund receipts handy for future reference and avoid paperwork headaches.
Wrap-Up
ABSD can feel like stepping into a financial labyrinth, but knowing the difference between new developments and resale properties—and when to drop the cash—makes the journey way more manageable. Grab a coffee, chart your moves, and soon you’ll be the proud owner with CPF working behind the scenes to keep your finances stress‑free and breezy.
2. Decouple (if the cost doesn’t exceed the ABSD)
A Friendly Guide to Avoiding ABSD (and What It Really Costs)
What’s the Trick?
Imagine a two‑person home ownership that’s like a see‑saw:
Because the first spouse no longer “owns” the original property (they’ve handed it over), the new purchase won’t be hit by the Additional Buyer’s Stamp Duty (ABSD). Sounds like a clever loophole, right? The reality is a bit more dicey.
The Hidden Bills
1⃣ Buyers Stamp Duty (BSD)
Even though the ABSD escapes, the BSD still comes knocking.
2⃣ Sellers Stamp Duty (SSD)
If you sell the transferred share within three years of buying it, you’ll have to pay SSD as well.
3⃣ Decoupling Costs
Breaking the joint ownership is not free—expect to pay about $5,000–$6,000 just to get the paperwork sorted.
The Bottom Line
If you suspect you’re creeping close to that break‑even point, drop us a message. We can crunch the numbers with you.
Mortgage & CPF Matters
HDB Flat Ownership: The 2016 Switch‑Off
The whole “transfer your share and keep heading on” trick was patched up back in 2016 for HDB flats.
Now you can only do it under six specific circumstances:
In short, if you’re dealing with an HDB flat, you’re pretty much out of luck unless one of those exceptions applies.
3. Single Owner and Essential Occupier scheme
Why Planning Ahead Might Save Your Wallet (and Your Relationship)
Do you dream of owning two sleek condos in Singapore? It’s a pretty cool idea, but the rules have tightened up. Let’s break it down in plain, friendly English—no legal jargon, just straight talk.
The New Reality: No More “Just Pass the Title Around”
Singapore’s rules now say you can’t transfer out the ownership of an HDB flat unless you’re in one of six special cases. That means the typical “just hand it over to your spouse” trick won’t do if you’re eyeing that second property.
Enter the Single Owner & Essential Occupier Scheme
Think of it as a clever swap. Instead of listing your spouse as a co‑owner, you’ll list them as an Essential Occupier (EO). Your spouse keeps living there, but legally it’s you who owns the house.
- Build that “first‑time homeowner” badge for your private property purchase. Once you’ve lived there five years, your spouse’s EO status fades, and you qualify as a first‑time buyer, which is a big money‑saving deal.
- Skip the ABSD tax. Owning a private home as a first‑time buyer means no Additional Buyer’s Stamp Duty. That’s some serious savings.
- Get the golden 75% LTV limit. You can borrow up to 75% of the property’s value in your first‑time buyer round, compared to the 55% cap you’d face if you didn’t use the EO trick.
But Here’s the Catch (We’re Not about to keep it all sweet)
- No Cash‑Back from CPF. As an EO, you can’t tap into your CPF to help pay the down‑payment or monthly instalments. You have to bring the cash yourself.
- No “Legal Claim” if Drama Hits. Since you’re legally the only owner, if something goes south (you and your partner split up or otherwise), the EO has no protective rights over the property.
- Mortgage Eligibility is Half the Picture. Only the single owner qualifies to take on the mortgage. That means your assessable income is capped by only your earnings. Some people find that squeeze hard, especially if your partner is bringing in a chunk of the income.
Bottom Line: For Who It’s Best
Is this scheme going to be your ticket to two homes? If your income can comfortably support a mortgage on its own and you’re okay with the limitations on CPF use and legal protection, it can be a brilliant way to avoid extra taxes and get the best loan terms.
Otherwise, you might need to look at other financing options—or maybe go it alone and buy just one house for now. Either way, a good plan is better than a guessing game. Happy house hunting!
4. Purchase under a Trust (if you have a lot of cash in hand)
Trust‑Town: Why Your Kids Need a Lawyer, Not a Fortune Cookie
Suppose you want to hand over your crib to your kiddos via a living trust. Yep, that classic “keep the property in the family” move. But before you start playing Monopoly, grab a conveyancing lawyer – this isn’t a DIY session.
Extra Fees on the Horizon
On May 9, the authorities dropped a fresh 35 % Additional Buyer’s Stamp Duty (ABSD) bomb on every residential property transfer into a living trust. Think of it as a surprise demolition fee that takes a chunk of your balance sheet right off the bat.
What This Means for You, The Parents
- No ABSD before the cut‑off? That was the sweet spot. If you simply slipped a title into your children’s names (and they owned no other houses), you’d sail under the ABSD radar.
- Post‑May 9: Every trust transfer now carries that 35 % ABSD, no matter how many people benefit.
Can You Get a Refund?
Good news: the law offers a loophole. If you’re savvy enough to meet specific criteria, you can claw back that ABSD within six months after the trust paper is signed:
- All property owners must be clearly identifiable individuals.
- Their ownership must be fully vested at the moment the property is nested into the trust.
- No one can change or revoke that ownership, or toss in a “condition later” clause in the trust text.
Crafting the Trust is Where the Drama Starts
Ask your conveyancer to draft the trust with those lines in mind. A misstep, and you might end up with a giant cash hole carved out of the ABSD refund. After all, you’re paying that 35 % upfront – you can’t walk away from it later.
House‑Ownership Consequences for the Kids
Remember: If your children actually live in the house, they can’t apply for an HDB flat while still owning it. And if they decide to grab another property later, ABSD will bite again.
Financing Footnote
Oh, and be aware – banks won’t extend loans to properties held in a trust. It’s a straight‑up cash purchase situation. So keep your piggy bank ready or your kids a bit more adventurous with their savings.
5. Sell one, buy two
How to Turn Your Home into a Money‑Making Powerhouse
Step 1: Rip It Up
Still stuck in that cramped five‑room flat you got from your grandparents? Time to give it a dramatic exit. Sell it for a tidy $575,000—a figure that can fuel your next buying spree.
Step 2: The Big Move (You)
- Grab a shiny $1.5 million condo.
- Use $375,000 for the down‑payment to avoid a massive loan.
- Keep the deed entirely in your name—no lingering property tax woes.
- Make sure your credit is as strong as a superhero to clear the mortgage hurdles.
Step 3: The Little One (Spouse)
- Secure a smaller $800,000 shoebox unit.
- Put down $200,000 before the purchase closes.
- She owns it all—no ownership battles later.
- And best of all: no ABSD tax hits this side either.
Why It Works
By selling first, you clear all pre‑existing property tags, so when you buy the bigger place you’re starting fresh. Because your spouse buys her unit separately—also without a previous property—both of you sidestep the ABSD tax entirely. Just remember: both of you need strong mortgage approvals, so keep your joint finances neat and tidy.
6. Get a dual-key unit
Remember That Snazzy Dual-Key Floor Plan Topic?
Sure thing— we’ve already walked through it in our previous deep‑diver article about dual‑key layouts.
What’s Up With Dual‑Key Units?
Ever wondered how a single house can feel like two separate homes? That’s the magic of a dual‑key unit. Let’s break it down in plain English, with a dash of humor.
How It Works
- Shared foyer – The front door is one, but the entryway splits into two distinct corridors.
- Two distinct spaces – After that foyer, the property branches into two separate sub‑units, each with its own front door, kitchen, bathroom, and furnishings.
- Perfect for – Two families in the same house (think you + your in‑laws), or even a tenant and a landlord living side‑by‑side.
You Get Privacy Without the Extra Tax
Even though it looks like two tiny homes, a dual‑key unit is still just one property under the law. That means you’re not paying an additional Buying-Sell-Due (ABSD) tax on the second “unit.” It’s all about one mortgage, one tax payment.
Why It’s a Win‑Win
- Both sides enjoy their own space while sharing common areas.
- Fewer headaches than buying two separate houses.
- Smart financial move – no extra property tax on the split.
So next time you see a dual‑key listing, know that it’s a clever way to give both parties a slice of the home pie without eating into the budget.
7. Buy a commercial property
Smart Ways to Invest Without the ABSD Pain
Hey, investors! Good news—commercial properties are ABSD‑free. All you get is a 7% GST (at the time of writing). That’s it.
Why Mix It Up?
Instead of piling up sky‑high condos for rent, think outside the box:
- Coffee‑shop – people always need caffeine, and the lease is usually robust.
- Office suites – the modern blue–collar lifestyle.
<li Industrial space – factories, warehouses, you name it.
But heads up: commercial is a whole new ball game. Market timing, zoning, tenant onboarding—each step has its own twists.
Couples, This One’s for You
- Put the first home under just one spouse’s name. No ABSD ding.
- If you can handle the mortgage solo, skip the co‑borrower step.
- Later, as savings grow, the other spouse can buy a property solo—and since it’s a first‑time purchase, no ABSD again.
- Result? Two properties in the family, zero ABSD, and a whole lot less hassle.
This strategy is the slow‑and‑steady version of the hype of “flip fast.” It’s unaffordable to let the ABSD bite, but it’s not rocket science either—just a patient, step‑by‑step plan.
— Posted first on StackedHomes
