Choosing HDB flats is a no-brainer when it comes to purchasing a home in Singapore. Often, the real question lies in choosing between build-to-order (BTO) flats or resale apartments.
While the decision will ultimately depend on your needs, BTO flats are a popular option for those looking for more affordable housing with longer leases. And with the launch of more units in a few months time, you’ll want to start preparing for your application early.
To help you with that, we curated this handy guide that tells you everything you need to know about HDB BTOs, from eligibility to the ballot process.
What are BTOs?
A BTO is a type of HDB flat launched before they’re constructed. In other words, they’re brand new flats that come with a 99-year lease.
Buyers will submit their applications during a sales launch happening about twice a year. In comparison, resale flats are available all year round, which are easily accessible via property agents or real estate platforms.
The construction of a BTO flat will only start once 65% to 70% of the units have been reserved. As such, it would normally take about three to five years before a buyer can move into their BTO flat.
This May 2022, HDB will launch about 5,200 to 5,700 units in six estates, as listed below:
|Location (May 2022 BTO Launch)||HDB Flat Type|
|Bukit Merah||3-/ 4-room|
|Jurong West||2-room Flexi/ 3-/ 4-/ 5-room|
|Toa Payoh||2-room Flexi/ 3-/ 4-room|
|Yishun||2-room Flexi/ 4-/ 5-room|
|Total Units:||5,200 to 5,700|
Once you’re fully decided, the next thing you should know is that HDB flat types have different eligibility requirements. If this is your first time applying for a BTO, you should first consider whether you qualify for it or not.
Here’s a list of general eligibility requirements:
|Nutrient||Major Vegetarian Sources|
• At least 1 Singapore Citizen applicant
• At least 1 other Singapore Citizen or Singapore Permanent Resident
|Age||At least 21 years old|
|Income Ceiling||You are within the set income ceiling for the flat you intend to buy|
|Property Ownership|| |
• All applicants and occupiers listed in the flat application do not own other property overseas or locally, and have not disposed of any within the last 30 months
• All applicants and occupiers listed in the flat application cannot invest in private residential property from the date of flat application till after the 5-year Minimum Occupation Period (MOP)
• You have not bought a new HDB/ DBSS flat or EC, or received a CPF Housing Grant before; or, have only bought 1 of those properties/ received 1 CPF Housing Grant thus far
Taken from HDB’s website. Updated as of January 2022.
Because BTOs are heavily subsidised, there are several eligibility criteria that you must meet on top of the most basic requirements listed above. Depending on your circumstances, you must apply in any one of HDB’s three eligibility schemes, as detailed below:
Under this scheme, you must form a family nucleus with any of the following:
- Spouse, and children (if any)
- Parents, and siblings (if any)
- Children under your legal custody, care and control (if widowed/divorced)
Single parents may still apply under this scheme, but will be subject to further investigation by the HDB. Applicants with special circumstances like this must send an email to the HDB via their online feedback form.
This scheme involves forming a family nucleus with your spouse-to-be. Under this scheme, you must solemnise your marriage within three months of receiving your keys to your flat.
In other words, you must submit your marriage certificate to the HDB within three months after the completion date of your flat.
If you or your siblings (those applying) are orphans, you can apply under this scheme. Take note that all siblings listed in the application must be single (i.e. unmarried, divorced, or widowed).
Moreover, at least one of the deceased parents must have been a Singapore citizen or permanent resident.
Each of these schemes have their own list of required documents, which you can read more about on HDB’s website. If you’re eligible under any of these schemes, this means that you have several options regarding the type of BTO flat that you can get.
To avail a specific flat type, you must not exceed the $14,000 limit of your total monthly household income. Here are the income ceilings based on the types of HDB flats:
|Type of HDB Flat||Income Ceiling|
|2-Room Flexi||$7,000 for 99-year leases or $14,000 for short leases (15 to 45 years)|
|3-Room Flat||$7,000 or $14,000 depending on project|
|4-Room Flat or Bigger||$14,000; or $21,000 if purchasing with extended or multi-generation family|
Financing Your BTO Flat
Before lodging your application, we highly advise you to consider your finances first. Unless you can pay for your BTO flat right off the bat, there are two ways in which you can finance your flat: HDB loans or bank loans.
HDB loans allow you to borrow up to 85% of the total value of the flat with a fixed interest rate of 2.6%. You can pay the required 15% downpayment using your CPF account.
If you’re planning to take this route, you must first apply for an HDB Loan Eligibility (HLE) letter, which states the amount that the HDB is willing to loan you. You’ll need this letter later on once you’re invited to pick your flat.
To avail this loan, you must meet eligibility requirements noted on HDB’s website.
With a bank loan, you can borrow up to 75% of the flat’s total value with a projected interest rate of 1.2% to 1.5% within the first two to three years of repayment. Beyond this period, interest rates will fluctuate depending on the market.
You need to apply for an Approval in Principle (AIP) from your chosen bank, which is granted depending on your credit history. An AIP is the equivalent of an HLE letter, which you’ll also need to secure your chosen flat eventually.
Other than these, check out the table below for a quick summary of the differences between HDB loans and bank loans:
|Variables||HDB Loans||Bank Loans|
|Interest Rate||Fixed at 2.6% per annum||1.2% to 1.5% per annum (subject to increase after 2 to 3 years)|
|Loan to Value Limit (LTV)||85%||70%|
|Downpayment||15% can be fully paid using CPF||5% must be paid in cash; 20% can be paid using cash or CPF|
|Early Repayment||No penalty||1.5% penalty|
|Late Payment||7.5% late payment fee per year||$50 late payment fee per repayment|
|Requirements||Generally stricter; check out HDB website||Generally more flexible; may vary per bank; good credit history|
|Refinance Options||Can switch to bank loan||Can switch between banks, but switching to HDB loan isn’t allowed|
So, here’s what’s going to happen once you determine that you’re eligible to apply.
First, be on the lookout for HDB’s upcoming sales launch announcements on their website, which normally occurs around six months prior to the launch.
Make sure to take note of the application period so you can lodge your application for your chosen flat type. You’ll have to pay $10 to ballot for the flat you want.
Once applications close, HDB applications will run through a computerised balloting system that randomly assigns you with a queue number. Basically, your queue number will dictate when you’re able to view and select a flat.
For example, let’s say that there are 200 flats available in the Queenstown estate. If you manage to get a queue number of 53, it means that you have a wider selection of HDB units to choose from.
Otherwise, a queue number of 178 will mean that you have less options to choose from. If your balloted queue position has exceeded the flat supply (200, in this case), then it means that you’d have to go through the process again in the next sales launch.
Note that this process isn’t on a first-come-first-served basis. The system has a few priority schemes (like first-time applicants expecting a child, senior citizens, etc.) that improves one’s ballot chances.
Of course, luck also plays a role in the process. Expect to hear from the HDB within three weeks to know whether you’re successful or not.
Signing the Lease and Keys Collection
So you’ve managed to get a good queue number, congratulations! All you have to do is to wait for your appointment to select your unit, which could take months depending on your number.
During your appointment, be sure to bring your identification card, appointment letter, and HLE letter or AIP if you’re taking out a loan. You can refer to HDB’s website for a full list of required documents.
You can expect to sign the Agreement for Lease in about four months of booking a flat. During your appointment, you can also expect to know your flat’s Estimated Completed Date (ECD).
As its name suggests, this is the day when you can collect the keys to your flat and begin the process of moving in. Depending on the estate’s construction progress, your flat may be completed earlier.
BTO flats come empty, so it’s important to think about the types of renovation work you want to have completed. For starters, you can refer to our handy guide to home renovations in Singapore.
Be sure to take into consideration the financial aspect of renovating your home too. The quickest way to do that is to take out a home renovation loan.