What is a HDB Negative Sale and why should you care?

Or in other words, “Why did my flat price increase but I did not get ANY cash from selling my flat?”  

It’s a strange situation to think that you don’t get ANY profits from selling your flat – despite putting thousands of dollars in it every year, but yes it is happening AND it can happen to you. 

Putting money into a stagnant property is like pouring into a leaking bucket - HDB Negative sale

Is your own property a leaking bucket? 

How does a negative sale happen? 

A hdb negative sale happens when the flat prices increases at a rate that is slower than the amount of interest you paid to HDB (2.6%) or the bank (check with the bank for the amount you paid, 1.3 – 3%) AND  the CPF accrued interest of 2.5%.

To get any cash profit from the sale of your flat, its roughly estimated that your flat needs to have an annual capital appreciation that is more than the HDB interest rate and the CPF accrued interest rate i.e. an annual capital appreciation of 5.1%. If this doesn’t happen, your returns may get locked into your CPF. In addition, because of the minimum sum requirements,  usage for the next flat might also be limited (*this happens if you are planning to do downgrade after 55)

Singaporeans have the assumption that they can easily cash out on their HDB flats as source of retirement income when they sell their bigger flat and downsize to a smaller one. However this has not been the case recently.

Because of the stagnant market, quite a number of HDB homeowners have discovered that they do not get any cash profits from the sale of their flats and they are sometimes unable to down grade to a smaller resale flat due to the lack of funds. Their only option is sometimes a limited lease 2 room BTO from HDB, which takes times since it can only be purchased at BTO launches and SBF sales, although there are more options at ROF selections now.

What is a negative HDB sale

This is the sales cycle of HDB prices since 1989. If you are counting on holding on your flat until the next wave, you might be waiting for a very long time. Will your flat reach the 40 year depreciation dive then? 

Who has profited the most from their HDB?

  1. People who bought flats in the good old days and flats have appreciated 200 – 300%.  This is fairly common for those who purchased flats 20-30 years ago. However, it would be illogical to think that HDB flat prices can increase to more than 1 million. 
  2. People who pay for their flats in cash. If cash was used to pay for the flat, the returns would also be in cash. They are also not subjected to 2.5% accrued interest in CPF.
  3. People who focused on growth properties (Both HDB and private). There are some people who selected their home based on how the property can appreciate.
  4. People who accepts that their own home can never be an investment, but a rental property definitely is.  

How does this affect you?

What should i do if my flat is experiencing a negative sale? 

There is no one size fits all step for everyone experiencing a negative sale. If your flat has reached MOP or is about to reach MOP, you can read more about your options here.

 It's important to understand what you are going to do next before rushing to sell your flat.  While some people can benefit from asset progressions and focusing on growth properties. Some might benefit from cutting their losses and fully paying off their loans. 

We provide free consultations for those who are unsure about what to do next. Please text us at 96918885 to book an appointment today.

Can Your CPF Disappear? HDB Negative sales and the pitfalls.

Can the CPF that you earned disappear? Sadly yes.  

If you have been using your CPF to pay off your property, we have bad news for you.  In a stagnant or depreciating property market, we've seen cases of CPF that you've earned 'disappearing' from our client's accounts. If you are planning for your HDB to be your retirement plan, our advise is to think again. Read our article on why your HDB should not be your retirement plan.

No we are not just referring to the CPF accrued interest i.e. the funds that you would have earned, had you left that amount in your OA instead of using it for your mortgage payments. (Read the clarification on this on the Factually website. See Myth 2.)

Here's how it can happen.


Recently, I did a consultation with a young couple who were planning on selling the first resale flat they bought i.e.;

  • a 4- room resale flat in Woodlands/ Admiralty, which they bought about 5 years back.
  • They bought it at the peak of the resale market and prices have declined since then. They bought the flat at $409 000 and their remaining loan amount was about $250 000.  The estimated flat price now based on recent transactions and valuation is $320 000.
  • The CPF used by both parties for mortgage payments amounted to about $190 000 and the accrued interest amounted to about $30 000.

To break even, i.e. to not lose any money, they had to sell the flat for about $495 000, which in the 2019 Property market, would be quite impossible, as that might mean a COV (Cash Over Valuation) of about $175 000 for the buyer.  ( Yes, there can still be COV in the HDB Market. Check out this article to understand how it works).

If the the couple sold their flat at market rate, this would mean a negative sale of $150 000. Since their accrued interest was about $30 000 ( and since some claim that accrued interest is negligible anyway), their CPF contributions of about $120 000 just disappeared into thin air. 

Can you imagine?? $120 000 of your hard earned CPF just disappearing like that. They were only left with $70 000 of their CPF to use for their next purchase.

How did $120 000 of their CPF disappear?  

  • There was a steep decline in their flat prices. The flat’s location was in Woodlands and combined with an influx of new flats in the area, the price of older flats fell.
  • To profit from the sale of your HDB flat, you would need a growth of at least 5.1% each year. ( 5.1% is derived from 2.6% HDB interest rates and 2.5% accrued interest rate). The HDB resale market has been stagnant recently.
HDB Resale Prices Index
HDB Price Falling 2019

What can you do to protect your CPF or your assets? 

  • Pray that the HDB Market improves. ( We’re not sure if this works but no harm trying right? )
  • Figure out if you have profited from your current flat. ( For flats that just reached MOP, you might want to check out this article to figure out what you can do next)
  • Figure out a suitable asset growth strategy, based on your age and lifestyle to see if investing in an asset which can appreciate would be suitable for you.  ( We don't recommend upgrading to everyone)
  • SMS/ Whatsapp/ Call us at 96918885 for a free consultation and a customised plan on what to do next. No obligations, we promise. We’ll customise a plan to suit your needs.

My flat just MOP (minimum occupation period), what are my options?

HDB Resale Minimum Occupation Period (MOP)

Congratulations on your HDB flat reaching the Minimum Occupation Period or the MOP !

If you got a BTO, it's probably been 8 - 9 years since you applied for one. (i.e. 5 years since you collected your keys, 2-3 years since you got a ballot queue number and about a year applying for and getting the news that you have a queue number to select a flat) and hey you deserve more than a pat on the back for your patience ! BTO flats usually appreciate by the time they reach the MOP (unless you are one of the unfortunate ones hit by HDB's racial quota policies) and owners who choose to sell their BTO would probably be able to get some cash out of their investment after deducting the outstanding loan and the CPF refund. 

For resale flats, it's probably around 5-6 years since you've decided to get one. Profits, however, depends on how long ago you purchased the flat and the price that you paid for it. Demand for resale flats are picking up although prices are not as high as during the peak. 

But enough about the state of the HDB market . 

Although the end of the MOP signals that you can sell off your flat, the focus should not just be on how much cash you can get out of it. Instead, the focus should be on how to use what you have to profit further, or at least put it into another investment which can give you better returns.

HDB MOP Minimum Occupation Period

You've hit the MOP - What's next?

You may be confused about the choices that you have. Should you upgrade, should you downgrade? Will you get the same kind of profit appreciation if you stay put? Is there a chance that your profit might decrease?
Are there any other housing types which will allow you to experience the same kind of appreciation that you got with that BTO? 

So many questions, so many options.

Factors affecting your next decision. 

 If these are your concerns and you’re wondering, “ What should I do next?”, read on. We've listed below some of the next steps you can take once your flat reaches MOP. Of course, not every option is available to every on as it is dependent on a few factors. Some of these important factors include. 

A) Cash sales proceeds (if any)

Will you get any cash proceeds from the sale of your flat or is it a negative sale? Does your unit face ethnic quota restrictions which might affect your cash proceeds or how fast you can sell your flat.

B) Your current CPF Balance and your minimum sum amount. 

CPF can be used for the downpayment of your unit as well as other expenses like legal fees and stamp duty. Even if you are young and will not be approaching retirement age very soon, you need to know about your minimum sum amount if you want to use it to fund the purchase of your second property. 

C) Cash for downpayment

You will need some cash if you plan on taking a bank loan. If you are planning to take a loan, the minimum amount is 5% of the property price. If you have an existing mortage, the amount can be up to 25% of the price of the next property. 

D) Resale Levy

For some people, the resale levy payable by cash is a game changer. The resale levy is applicable to the next subsidised flat or EC, if you took a first-timer HDB grant on if your first purchase. The amount you need to pay depends on the size of your first flat. 

E) The loan you can get for your next purchase

The amount of loan depends on your current salary, your age, and the number properties you own that is still under a mortgage. This is known as the LTV or the (loan-to-valuation).

F) Your Timeline

One of the main determinants for getting a BTO, new launch or resale property is your timeline.  Appreciation is usually larger when you purchase a unit at a new launch rather than one that's ready for occupation. 

G) Other plans 

For some parents, factors like primary school enrolment is a factor to move house. 

We understand that selling your property is a huge investment. If you are still unclear about what to do next, we are here to help. Send us a msg at 96918885 if you'd like to find out more about the following : 

1) Current valuation of your flat 

2) Which step would be most suitable for you and your family? 

Even if you still haven't made up your mind regarding what to do next, don't worry about it. We are here to answer your queries.  

Some options you can take after your flat reaches MOP

1) Review your family situation ( and finances) to see if there is a need to rightsize /upgrade /downgrade to a bigger or smaller flat.

HDB resale calculations

For most of our clients, having a comfortable home for their family is the priority. Since the time you bought the flat, your family size and structure may be very different from what it is now. Whether it's because your family has grown, whether its because your children have left the nest, or that your parents have moved in with you, we understand your need for a change. ( If you just want to move closer to family and take advantage of the Proximity Grant, we've covered that in point 2) 

If you are looking for a bigger flat to accommodate a growing family or so that you can bring your parents to live with you, you might want to consider a resale flat in a mature estate. The size of a resale flat is typically larger in a mature estate where you would see flat types like Executive Apartments, Maisonettes, or even 5A size flats that suit your growing family. On the flip side, if you are downgrading, you might want to consider 3 room flats in a mature estate or even a 2-room flexi direct from HDB

2) Move closer to your parents and enjoy a $20 000 discount off your next resale flat (i.e. the Proximity Grant)

Proximity Grant HDB

Even if your parents aren’t keen to move out of their home, you can do them a favour and move closer to them. In fact, the Government encourages this and is willing to put their money where their mouth is.

The $20 000 Proximity Housing Grant (PHG) is a one time grant for eligible Singapore Citizens who move within 2km to their parents or to the estate where their parents live in. (Singles, we're sorry, a different set of rules apply to you for the PHG)
Can't decide between which parent to move closer to? Move closer to one set of parents and then move your in-laws closer to you, just because parents can also receive the $20 000 grant by moving close to their married children! This solution is perfect if one set of parents wants to downgrade - however, not all estate have smaller flats, so do your planning first. For e.g, Pasir Ris Estate does not have 3 room flats apart from the ones in Pasir Ris One.

3) Apply for another BTO

Once you have reached the MOP, you are able to apply for another BTO ( all Singaporeans are eligible for 2 new units). However take note of the following restrictions. 

  • You would have to pay a resale levy in cash. The amount ranges from between $15 000 to $ 55 000 depending on your first flat size.
  • If you choose to take a second HDB loan, half of the cash proceeds (if its more than $ 40 000) from the sale of your first flat, will have to go to paying for the second flat. 

4) Upgrade to an EC while there still are ECs without the Resale Levy

EC without Resale Levy Executive Condo

If you want to upgrade your lifestyle by living in a development with facilities, but do not want to be tied down with a huge mortgage, you might want to consider getting an EC. Since you have purchased a flat directly from HDB , you will be subjected to the resale levy of between $15000 to $55 000.  

Why should you consider purchasing an EC? Apart from the facilities, you enjoy a fully renovated & move in ready unit in a brand new development. Prices of ECs also usually rise substantially after the 5 and 10 year mark, making it a good alternative for property appreciation compared to stagnant resale HDB prices. 

2019 Update : ECs with No Resale Levies have completely been sold out and the supplies of ECs in general are very limited.  Check in with us for an updated list of available EC units. Meanwhile,  read more about Executive Condos here. 

5) Get an investment property while the private market is stagnant

We Asians love our properties. In fact, it is usually the ultimate dream to grow our wealth by owning multiple properties and renting it out for passive income.

If this is your goal as well, you might want to take a look at the available properties on sale while the market is cool. 

If you've been keeping up with the Singapore property news, you should know that the cooling measures (latest one in July 2018) has done its job pretty well to keep the market stable. Prices of property have not drastically dropped and doesnt look like it will anytime soon. In fact, the cooling measures show that demand of property in Singapore is still going on strong. 

This might be your opportunity to get an investment property while the market is cool. You may also choose to purchase a condo or a landed property for your family to live in while  you rent out your HDB.

Worried about the slow rental market? Get a new launch condo to ride it out and pay only a fraction of the monthly mortgage i.e the progressive payment plan (see below), while the development is still under construction.

Progressive payment schedule for new launches

Example of a progressive payment plan based on a $700 000 unit at an interest rate of 1.8%.

6) Stay put and enjoy the capital appreciation of your flat! 

If you bought the BTO during the launch, it is highly likely that you have enjoyed capital appreciation, i.e. the value of your flat has risen and you will be able to make a profit when you sell it off.  Since this remains 'virtual money' until you cash it out, some might prefer to sell and use the profits for another property which would experience another capital appreciation

If this is not your strategy, then sit back and enjoy the capital appreciation ! However, we strongly don't recommend using your HDB as a retirement plan as the HDB market might not appreciate enough to cover the accrued interest that has to be paid back to your CPF account. Click here to read more about this.

We understand that real estate is a huge investment. If you are still unclear about what to do next, we are here to help. 

Send us a msg at 96918885 if you'd like to find out more about the following : 

1) Current valuation of your flat 

2) Which step would be most suitable for you and your family? 

Even if you still haven't made up your mind regarding what to do next, don't worry about it. We are here to answer your queries.  

Can your HDB flat still be used as a retirement plan?

Is your HDB Flat your only retirement plan?

Avoid making this mistake before it's too late.

I felt compelled to write this post after reading this post on PropertyGuru about a 64 year old Singaporean who would not have much cash for retirement even after selling his Tampines Court Apartment. This is even though he bought the unit before privatization i.e. it experienced a substantial increase in price from the time he purchased it.

The owner was appealing to buy a BTO from HDB, most likely for the lower prices, which would free up more cash for his retirement.

Reactions on the Propertyguru FB post showed that most people were not convinced that this could happen and accused him of lying to get special privileges from HDB.

Tamp Court FB Pic Singapore

However, as a practicing agent, I feel that it is important for the general public to know that this type of scenario is NOT an exception.  It is increasingly becoming the norm, and it is especially sad for those who want to retire but then realise that they will NOT have much cash proceeds from the sale even though their flat price has appreciated substantially. 

By that time, you won't have sufficient time to start a proper retirement fund and most would have to resort to working for the rest of their lives. 

If you are still confused about how this might happen, I've included a case study below from a Singaporean couple who I have recently spoken to. Details have been made generic for educational purposes. 


Mr and Mrs XYZ are in their late 40s and have 3 children who are still in school. They bought a resale executive flat in Tampines for $443 000 in 2001. They took a HDB loan with a 2.6% interest rate.  Currently the selling price of that flat (as well as the estimated valuation from SRX) is around $620 000. 

They have been monitoring the market and since prices of flats have been falling, they would like to cash out and downgrade to a fully paid 4 room flat before their CPF gets compulsorily diverted into the Retirement Account.

Outstanding Loan : $195 000

They do not have much CPF in their ordinary accounts (OA).​

MR XYZ : CPF Usage for property + Accrued Interest = $ 230 712 +$61 379 =$ 292 091

MRS XYZ : CPF Usage for property + Accrued Interest : $83 642 + $23 130 = $106 772

Total to be returned to CPF = ​$292 091 + $106 772 = $398 863

Cash Proceeds  = Selling Price of the Flat  minus (-)  the existing loan minus (-) the amount you need to return to CPF. 

Therefore for this couple , the cash proceeds from the sale of their flat would be a mere $620 000 - $195 000 - ​$398 863 = $26 137.

This also means that they are only able to use $398 863 from their CPF funds for their next flat, without even considering additional factors like renovation costs etc. 

If they delay their decision, we predict that the HDB ramping up supply would lead to a further dip in prices, and with interest and accrued interest still accumulating, they might have a negative sale further down the road.

Alternatively, they might want to wait until their children are all grown up, and move into a studio apartment so that they can pocket more cash from the transaction. 

Why were my parents able to retire on the funds from their HDB flat? 

  • ​Prices of HDB Flats were extremely low 30 - 40 years ago and it is a norm to see prices of flats appreciate by 3-4 times. In contrast, the prices of flats of flats purchased about 10 years ago have only appreciated by less than half. 
  • The previous generation most likely paid for their flats by cash (instead of CPF) and this reduces the amount of CPF and the accrued interest to be refunded back into the account.
  • The minimum sum for couples increase according to inflation  which means you will be paying more.

Will the prices of HDB go up? 

There will definitely be an increase based on inflation but we don't forsee double digit growth or a doubling of prices like that in 2008 - 2015. If you look at the HDB Price Index Below, you'll see that the growth did not occur in history and probably would not continue, especially with Ministers promising to keep public housing affordable. 

HDB Price Index 2016

What does this mean for you? 

We are not fortune tellers and we cannot predict how the market would be like when it is time for you to retire but this is some advice that we would like to give so that your situation won't be so tight 20 - 30 years down the road. Of course, you have to carefully consider each one with regards to your own risk appetite and financial situation.

  1. Plan for retirement early and don't depend on your HDB flat as a retirement p​lan. 
    • Just to understand how much interest you will be paying ( believe me it can be a shocker) , find a free mortgage calculator app or online. The total amount of interest you pay will be based on your the interest rate, your total loan amount, and the number of years you are taking the loan for.  Unfortunately there are no calculators online to estimate accrued interest, so you can estimate it using a 2.5% interest rate. 
  2.  If you are the type who allows excess CPF to just sit in your OA, you should consider paying of your home loan early.
    For HDB loans, this reduces the total amount of interest and accrued interest you have to pay. Making Partial Capital Repayment  on HDB loans is extremely easy to do and there are no penalties for early repayment. 
    For bank loans, you need to check with your banks if there are any penalties for early repayment.
    • NOTE : We understand that there multiple point of views about paying off a mortgage loan early. From our point of view, paying off mortgage loans early works well if it is for your own residence. For properties that you rent out, the strategy should be different since it is the tenants who pay for the interest and the principal. 
    • We also know about the argument that a person shouldn't pay off their home loan early because if you die, your home would be covered by insurance and your spouse will get both your existing cpf and the insurance payout ( instead of nothing since you used up your CPF to pay for the loan) . Well we can't argue with that, but we also hope that you have a plan in place if both of you live long and healthy lives. 
  3. Look into other forms of retirement plans or purchasing another private property  to fund your retirement as the rent that your tenants pay will contribute towards your equity. Once the tenants fully pays off your mortgage for that property, it can be a source of monthly income for you. 

Buying a HDB resale property: Does $0 COV really mean no cash upfront?


Resale HDB Prices : $0 COV

Do you need cash to buy a HDB Resale Flat?

On 10 March 2014, HDB revised the procedure for buyers to purchase a resale HDB property from the open market. Since then, prices of HDB flats have been going down, with one very obvious change  being the drop in the asking COV (Cash -Over-Valuation)  prices.

With the change in procedure, sellers are no longer able to dictate how much COV they want but instead have to “package it” into the total asking price for the flat.

What does this mean for buyers? Does this mean that there will not be any COV payable? Does this mean that buying a resale flat does not require any cash up front?

Not quite. There might be COV involved AND there is still some cash involved in the purchase.

Before we explain the COV portion and the cash involved in the process, buyers should first understand the old and new HDB resale procedures, and how it will affect how much cash you need for that resale HDB.

Old Resale Procedure

Prior to 10 March 2014, when the seller of a flat decides to sell, they would purchase a valuation report from a valuer through HDB. The valuation report will give the seller the ‘starting price’ of the flat, and the seller would add on to it by placing a cash premium on top of the selling price.

This cash premium was known as Cash over Valuation or COV and you cannot take a loan to cover this amount. Note that the banks or HDB will only grant buyers a loan based on the official valuation of the flat.

It got to a point where COVs went up to $100 000 and finding a flat with low COV was almost like hitting the jackpot.

New Procedure

When a seller decides to sell his home, he can no longer get an official valuation of the flat. Instead, he can review HDB’s recent transaction of flats in the area or use various tools available online for example on SRX online to make an estimate of the value of his flat.

With the estimated valuation in mind, the seller can then invite buyers to view his flat based on his selling price, which includes the COV if any.

If the buyers are interested in the flat, they will put in an offer.

The negotiation process starts and once both buyers and sellers arrive at a mutually agreed price, the seller will grant the buyers an option to purchase (OTP). The buyer will then put a deposit (also known as option money), of up to $1000.

With this option to purchase, buyers will proceed to apply for a valuation of the flat via the HDB website. HDB usually doesn’t disclose to the valuers the agreed selling price of the flat.

The valuation company will then send the report directly to the buyers, which means the Seller will not be informed about the valuation of the flat. Whether or not the Seller finds out about the valuation, he will not be able to adjust his selling price.

Only with this valuation report, will the buyers be able to determine if they need to top up any cash for the flat based on the following scenarios.

  • If the valuation matches the agreed selling price, the flat is considered to be sold at valuation . Buyers They do not have to top up any cash for the flat)


  • If the valuation is more than the selling price of the flat, the flat is considered to be sold below valuation. Buyers do not need to top up any cash for the flat.


  • If the valuation is below the selling price of the flat, the flat is considered to be sold above valuation. Buyers would have to top up cash to make up the difference between the loan granted (i.e. the valuation) and the selling price.

However, at this stage, the buyer has not confirmed the purchase. If they find that the COV is too high, they are still allowed to back out of the deal but they will not be able to get back the initial deposit made to the sellers.

What are the other costs involved in buying a resale flat?

Apart from the Cash over valuation (if any), there are also other costs, which you would need to pay when purchasing a resale flat.

Costs Payable by CPF

(If your cpf is insufficient, you would need to top up by cash.)

  • Stamp Duty (This is about 3% of the value of the flat)


Costs Payable by Cash only

A) Option fee

This is the ‘deposit’ you pay the seller to kickstart the buying process.

This amount is between $1 to a maximum of $1000. The current market practice is $1k but this is negotiable.

B) Exercise option fee.

This is the fee you pay to the seller to confirm your purchase. after you have received the valuation report and have arranged for a loan with either HDB or a bank. This amount is also negotiable but the current market practice is $4000, which is also the maximum amount legally.

C) Valuation Cost

  • $140.40 for 1-2 room flats and
  • $199. 25 for 3 room and bigger.

D) Resale Application Fee

  • $40 –for 1-2 room flats and
  • $80 for 3 room and bigger


E)Property Agent’s Commission.

For a HDB flat, the market rate is typically 1% of the flat price excluding GST.

In contrast, buying a BTO from HDB is substantial cheaper but has disadvantages like a long waiting time.

If you are still undecided, you might want to read our article comparing a BTO and a Resale HDB Flat .

HDB Resale Flats Property Singapore


You can read up on the costs involved when buying a BTO direct from HDB here.


Good Luck with your home search!


First Timers Dilemma : HDB BTO or Resale Flat?

Should first -timers buy a HDB Build to Order (BTO) Flat, HDB ROF (Re-offer of Balance Flat) or Resale Flats?

In Singapore, HDB (Housing and Development Board) is the main developer of public homes. High rise apartments, or better known to those living in Singapore as HDB Flats, is home to more than eighty percent of Singaporeans.

Each Singapore Citizen married couple (or Singaporeans within accepted criteria) is given 2 chances to purchase apartments directly from HDB. These include HDB BTO ( Built- to - Order), SBF (Sales of Balance Flat), ROF ( Re-offer of Balance Flats) as well as Executive Condominiums (ECs). Flats purchased from HDB are usually 'subsidised' or relatively cheaper compared to the existing developments in the area. However waiting time can be substantially longer as you purchase them while they are being developed. The exact duration you have to wait depends on if you purchase a BTO, SBF, ROF Flat.

The difference between BTO, SBF and ROF.

Most Built- to -Order flats (BTOs), Sales of Balance Flats (SBF) and Re-offer of Balance Flat (ROF) start out at the same point. HDB releases a site, and invites Singaporeans to purchase a unit. Singaporeans enter their names in a ballot for a BTO and they are able to select a flat based on their ballot numbers. ( The number of times your name is entered in a ballot depends on the priority schemes you are entitled to. ) 

Unselected flats from that round will be put in the pool for the next SBF. Eligible Singaporeans apply for the SBF and if there are flats that are still unselected, it would end up in the ROF pool. The ROF was previously held twice a year but HDB has recently announced that they will offer the ROF flats throughout the year.  This would reduce the waiting time for a ROF, because the flat would probably be ready for key collection by then. 

However, HDB has also started to offer resale flats which have been returned to them for various reasons ( divorce, death, inability to pay mortgage, unable to sell on the open market etc). These flats are also included in the pool of SBF but the reasons are not disclosed during the sale. You are also unable to see or check out the condition of these flats before you purchase. 

HDB has also started to place 're-purchased flats' into its pool of SBF/ROF flats. When selecting flats, you should be aware that not all of these are brand new flats. 

SBF Flats - Flats that are taken back by HDB

Take note that not all flats sold by HDB during their SBF/ROF is brand new.


Simply put, ROF flats are flats that have not been selected by previous potential buyers because of their attributes. This should be a critical factor for Singaporeans who wants to buy a new flat for its potential appreciation.

ROF FB comment Re offer of HDB flats

What should first - timer couples do? 

For newly married couples excited to begin their lives, there’s always the choice between buying a new HDB (BTO,SBF or ROF) or a resale flat. Until recently, resale flats in the open market have been too expensive for most first timers, with COVs ( Cash Over Valuations i.e. the cash premium above and beyond the flat’s valuation) going for an average of $30 000 to highs of $100 000. With other expenses to consider like wedding, furniture, renovation etc, the COV can be a deterrent to young couples. 

COVs have been falling to the point that it is no longer a norm, however it may still exist if you purchase a flat above the valuation price. (Confused? Don’t worry, we break it down in this article. Does $0 cov mean no cash upfront?  If you need more info regarding the steps to buying a resale flat, read this, " Buying a HDB resale flat ")

However, for new couples, settling into your own home as soon as possible can be one of the single most crucial steps in life. Unless you’ve been living together prior to marriage, a practice not very common to Asians, you would treasure the privacy that a new home provides, allowing you and your new spouse the opportunity to negotiate simple things in married life (like who cooks and does the dishes) and slowly work on constructing your lives.

HDB BTO, ROF or Resale? 

If you are one of those still undecided about if you should be buying a flat directly from HDB (BTO or ROF) or a HDB Resale Flat, these are some facts you can consider.



Resale Flats

Waiting Time

From the time of launch, the waiting times have an average of 2-4 years depending on the developer’s schedule.

HDB hasn't confirmed the duration it will take to get the keys to a flat but we estimate it would take between 3- 4 months.  

Once you decide on a house and exercise the option to purchase, it would take about 3- 6 months to the point you receive keys to the flat. 


For newly married couples, getting a BTO means that you have to live with either set of parents, which can result in a lack of privacy, having to meet the expectations of the In-laws etc.

Getting a flat direct from HDB which you can move right into after marriage is ideal. 


The privacy that comes with your own space, having a room with an en suite is most ideal

Flat Sizes

New flats in BTO and SBF are typically smaller in size.

ROF which are  new flats are typically smaller in size.

Resale HDB flats are much larger in size

Settling on one with an Size and Ideal Position.

Buying a BTO is similar to buying an item virtually or online. You view it on a screen, put in your order and be patient until its delivered. You are unable to see the view, whether you face your neighbours, the direction of the wind, the afternoon sun etc. 

Unfortunately for HDB BTO, there is no return policy if you are not fully satisfied with it.

You pick the flat from a list and you are not able to know how the unit looks likes, the direction it faces etc. 

When buying a resale flat, you would put in an offer to purchase the flat if you are totally satisfied with it. This includes being satisfied with the size, the location and the position of the flat i.e. the direction it is facing, the view, etc.


The cost of a Build to Order flat is subsidized by HDB which means that it is cheaper.

This means that you will NOT be able to utilize your first timer or proximity grants. ($40k - $70 k )

However if the total income of you and your spouse is less than $6500, (depending on the size and location of the flat you select), you will be eligible for the

Additional Housing Grant and the Special Housing Grant.

Also, if your order for the BTO is not put in at the initial launch, i.e. you buy it at the SBF (Sale of Balance Flat) Exercise, the price may have risen substantially to be similar to flats in the resale market.

The cost would be similar to a SBF. It would not be as cheap as a BTO as the unit is already completed. However, it will still be considered subsidised compared to a flat sold on the resale market. 

Resale Flats prices are pegged to the market rate of houses in the area and the current Real estate prices at that point in time.

For first time buyers, HDB provides a grant of $40 000 - $50 000 or more depending on your household income.

This is not inclusive of the $20 000 Proximity grant that you can get if you pick a flat close to your parents/ parents-in-law

You may also qualify for the Additional Housing Grant  of up to $40 000 if your combined income is less than $5k.

Renovation Costs

New BTO flats come unfurnished and you have to factor in renovation costs.

However, as they do not have existing floorings, cabinets etc, you can save quite a lot on hacking costs. You basically have a blank canvas to create your ideal living space.

Another positive point for new couples is that buying a flat that would only be ready in the future enables you to save up for renovation costs instead of paying additional interest on loans

Renovation costs of brand new flats are cheaper, but if you selected a 'repurchased' flat from the SBF/ROF, it would be similar to a resale flat which needs a total makeover

With regards to Renovation Costs, there 2 are scenarios which can happen.

A) You can select an apartment in good condition and save time and effort and money.

B) If you want to redo the flat, you would need to spend more on hacking and tearing down the current furnishings.

Old homes may also come with defects that form over time, for example leakage in pipes, crack in ceilings etc.


New flats in new estates usually do not have established amenities in the neighbourhood.

Similar to new BTO/SBF if they are brand new but similar to resale flats if they are repurchased. 

Mature housing estates have amenities conveniently within the neighbourhood

Potential for appreciation

If you bought a BTO and are able to select one with the best attributes, i.e. good unit in a good location, that is not faced with ethnic quota restrictions, you can somewhat count on an appreciation. 

Flat prices may appreciate to match the resale prices but you may find it hard to find a buyer because of the flat's attributes.

Flat prices might not appreciate as much as BTOs or SBF Flats.

If you are ready to purchase a resale flat but you are not sure where to start, you may find this article useful : Buying a resale flat.

HDB Resale Flat - Where to start