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How to Buy an HDB Resale Flat Without a Property Agent in Singapore

Couple researching on how to buy HDB Resale Flat Without an Agent

Maelyn Lagman

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Many homebuyers in Singapore are, by now, no strangers to the option of securing a home without a property agent. Technology has made it easier to get things done digitally, without the assistance of a human being. We see this in 3D virtual tours, which gained popularity amid the pandemic, and the continuous enhancement of property portals like Ohmyhome to match buyers with sellers according to their specific preferences and needs. To simplify your HDB buying journey, we’ve compiled all the steps you have to know to buy an HDB resale flat from the open market.

7 steps to buy a resale HDB flat without a property agent

Step 1: Apply for a HLE letter

To check your eligibility to buy a resale HDB flat, you need to apply for the HDB Loan Eligibility Letter (HLE). This will inform you of your eligibility to:

  • Purchase a BTO or resale HDB flat
  • Receive CPF housing grants and the grant amount
  • Take up a HDB housing loan and the loan amount

Step 2: Determine your budget

Before committing to a home purchase, it’s crucial to assess how much you can realistically afford. To ensure you have sufficient funds, work out a comprehensive financial plan by considering the following:

  • Cash outlay and use of CPF ordinary account (OA) savings
  • Applying for a housing loan
  • CPF housing grants
  • Payment for other costs, fees

Cash savings

You must use cash for the following payments:

  • Deposit to the seller, which is a maximum of $5,000, paid in 2 stages. (1) You will first have to pay up to $1,000 for the option fee and (2) the other $4,000 as a deposit when exercising the Option to Purchase (OTP). 
  • A portion of the initial payment, but only if you take a bank loan and/or have insufficient CPF savings.
  • Any amount not covered by CPF savings and eligible housing loan amount

Do note that if you are taking a second HDB loan to buy a resale flat, you will need to set aside part of the cash proceeds from the disposal of the existing or previous flat. That amount will be used to right-size the loan amount for your second HDB loan.

You will also need to set aside cash for other expenses, such as furnishings, renovation and the other costs and fees payable, which are:

  • Resale application administrative fee
  • Processing fee for Request for Value
  • Fire Insurance
  • Administrative Fee for Temporary Extension of Stay by flat sellers
  • Legal fees
Before committing to a home purchase, it’s crucial to assess how much you can realistically afford.

CPF savings

The savings in your CPF OA can be used for:

  • Initial payment in whole or in part (depending on whether you are taking an HDB housing loan or a bank loan)
  • Partial or full payment for the flat purchase at key collection
  • Monthly payments of mortgage instalments

However, there is a limit on the total amount of CPF savings you can use for your flat purchase. Once reached, you will be unable to withdraw more and then have to pay the balance amount in cash.

If you are taking an HDB loan, you will have the option of retaining up to $20,000 of the available CPF savings in your OA. The rest of the available CPF OA balance must be used to pay for the flat purchase before taking up an HDB housing loan.

From 10 May 2019, the total amount of CPF savings that can be used for your flat purchase and/or monthly mortgage instalments will depend on the extent the remaining lease of the flat can cover the youngest buyer up to the age of 95. 

For flat applications received on or after 10 May 2019:

Remaining lease of the flat is at least 20 years and can cover the youngest buyer up to the age of 95Applicable limits for CPF usage
YesThe amount of CPF savings that the buyers can use is capped at the lower of the valuation or the price of the flat at the time of purchase.
NoUse of CPF savings will be prorated based on the extent the remaining lease of the flat can cover the youngest buyer up to the age of 95. 

When the allowed CPF amount is used up, buyers will have to pay the balance purchase price and/or monthly mortgage instalments in cash. This will help the buyers to set aside CPF savings for their housing needs during retirement (e.g. buying a replacement property).

For information on the use of CPF savings, you may use the CPF Board’s online calculator.

Housing loan

You can also choose to finance your flat purchase by getting a housing loan from HDB or a bank. 

Housing loan from HDB

You will have to apply for an HDB loan eligibility letter (HLE), which indicates the loan amount you are eligible for. This is important as you will need to produce a valid HLE when obtaining the OTP from the seller.

Here’s what you have to pay when taking an HDB loan

Initial paymentMode of paymentWhen to pay
10% of purchase priceCPFOnline withdrawal of your CPF monies after you confirm your financial plan through the HDB Resale Portal
Cash (Only when the resale price is higher than the market valuation)At the resale completion appointment

Bank loan

You may approach a bank directly to check on your eligibility.

If you take a housing loan from a bank

Remember: Before exercising the OTP, you must have a valid Letter of Offer, a contract that states the terms of the loan package offered by the bank after they have approved your loan application.

Do take note that you will not be allowed to refinance the loan with a housing loan from HDB. 

Initial paymentMode of paymentWhen to pay
25% of purchase price for a loan ceiling of 75%CPF (20%)
Cash (5% minimum)
Dependent on bank’s payment schedule 
45% of purchase price for loan ceiling of 55% CPF (35%)
Cash (10% minimum)

If your CPF savings is insufficient, the balance must be paid in cash. 

Step 3: Look for a suitable flat

The rise of property technology and other digital solutions have made buying a home independently not just easier and faster – it is more cost-effective too as it saves one from paying an agent’s commission fee, which is usually 1-2% of the purchase price. 

A few of these digital solutions are: 

  • Property portals and mobile apps, which allow buyers to find listings and chat directly with the sellers; 
  • 3D video home tours, which give an immersive walkthrough experience of the space; and
  • Online house viewings and open houses, which buyers can watch on video conferencing platforms such as Zoom. 

As technology continues to evolve and improve, the journey of a DIY homebuyer may be even simpler in the future. 

Thanks to technology, buying a home independently is not just easier and faster – it is more cost-effective too.

When home shopping, do note that the sale of resale flats is subject to ethnic integration policy (EIP) quotas and SPR quotas. To check the latest quota in any particular area, visit HDB’s e-Service

You will also want to check the resale flat prices in your preferred area by using the HDB centralised map services. You can search the following there:

  • Resale transacted prices within 500 metres of any HDB block or DBSS site/project
  • Resale transacted prices for all flat types in each block
  • Other information related to the block (quotas, upgrading programmes, distance enquiries)

Step 4: Receive OTP from seller

So you’ve found a seller. After agreeing on the resale price and payment of the option fee, the seller will grant you the rights to buy the property within the period specified with a signed OTP. This means he or she cannot sell the property to another buyer during this time, giving you exclusive rights to purchase it until the OTP has expired.

The option fee may cost up to $1,000 and can be negotiated between the seller and buyer. At this stage, you are not yet required to sign the OTP.  

Once you’ve found a seller and agreed on the resale price and option fee amount, he/she will grant you a signed OTP.

The option period — which usually lasts 21 calendar days (including the weekend and public holidays) from the date the seller granted the OTP to you — is the period to decide if you really want to buy the flat, confirm your mode of financing and apply for a valuation of the flat. 

You can get a valuation report by submitting a Request for Value to HDB. You will need a valuation report if you are:

  • Taking an HDB loan;
  • Taking a housing loan from a bank;
  • Using CPF funds to buy the flat or service monthly loan instalments.

The valuation report will be used by the HDB, the CPF Board or your bank to calculate:

  • How much you can withdraw from your CPF savings;
  • How much housing loan can be granted to you; and
  • The minimum cash payment you must make.

Step 5: Exercise OTP 

If you proceed with the flat purchase, you must exercise the OTP within the option period and pay a deposit of up to $5,000 to the seller. 

If you are using a bank loan to finance your home purchase, you must have on hand a valid Letter of Offer from the bank before you exercise the OTP. This is to successfully close the transaction.

If you do not proceed with the purchase, the seller has the right to forfeit your option fee. 

Step 6: Submit resale application

Both the buyer and seller will have to use HDB’s e-Resale page to submit the resale application and supporting documents within seven days of each other. 

Pro Tip: You need not use the same system as the seller, who may be represented by a property agent and would have submitted the application on HDB’s Estate Agent Toolkit on his/her behalf.

The relevant documents are as follows: 

  • A valid HDB HLE (if you are taking a housing loan from the Board)
  • A valid letter of offer and acceptance from the bank (if you are taking a bank loan)
  • OTP
  • Legal representative letter (if you are not using HDB’s conveyancing services) 
  • Documentation required for grants
Once your resale flat application is approved, both the buyer and seller will be invited by HDB to attend the completion appointment.

After you have submitted your resale application, HDB will compute your estimated sale proceeds and provide a financial plan and some relevant forms and documentation for you to endorse. 

Once the documents are ready and posted on the HDB Resale Portal, you will be notified via SMS to endorse these within six days. If these are not endorsed by then, a reminder SMS will be sent and the deadline for the endorsement will be extended by two days. However, if the documents are still not endorsed by the extended deadline by either parties, HDB may cancel the resale flat application. 

Do note that if you are using the Proximity Grant, the parents or children (married or single) of the buyer must also endorse the documents within the same period. 

Step 7: Attend the completion appointment

Once the endorsement is done and your resale flat application is approved, HDB will arrange an appointment for both parties to complete the resale transaction and to sign the necessary documents that require wet-ink signatures. The completion letters will be posted on the HDB Resale Portal.

Flat buyers and sellers will need to attend only one appointment with HDB, instead of two previously. The first appointment will no longer be needed as all forms and checks will be completed on the resale portal. They will only need to attend the resale completion appointment, either at HDB Hub or at their solicitors’ office. 

By submitting the necessary documents promptly, the entire transaction time – from submission to completion of the resale application – may take up to eight weeks from 16 weeks previously.

Happy house hunting!

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Frequently asked questions about buying a resale HDB flat without a property agent

What is a resale HDB flat?

A resale HDB flat is a property currently owned by someone else that is put on sale in the open market. This means the flat has reached its five-year Minimum Occupation Period.

Can I buy a resale HDB without an agent?

Yes, you can. Before doing so, you will need to visit the HDB Resale Portal for an instant assessment of your eligibility to do so, as well as information on  CPF housing grants and the HDB housing loan.

Can I buy a resale flat from HDB?

No, because a resale flat is not sold directly by HDB.

While the Information is considered to be true and correct at the date of publication, changes in circumstances after the time of publication may impact on the accuracy of the Information. The Information may change without notice and Ohmyhome is not in any way liable for the accuracy of any information printed and stored or in any way interpreted and used by a user.

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