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  • Writer's pictureJoshua Loo

Time To Sell Your BTO Flat?

Time to Sell Your BTO Flat?

If you are a BTO, chances are that you have heard of the common practice of holding onto your BTO for 5 years and selling it immediately to maximize your capital gains. This practice is true to a certain extent, but how relevant is it to your situation? Let us take a closer look at the steps required to proceed.

This article generally does not cover the resale process, but to help you realize if it is the right time to sell your BTO flat.

If you are ready to take the next step forward, contact me so that I can aid you through the sale process.

Maximum Profits Obtained?

After the Minimum Occupation Period (MOP) of 5 years, you might feel the need to immediately sell your HDB flat. After all, these are usually recommended by real estate agents and your peers. Is this a necessity?

Some of the reasons why homeowners might be interested in selling their HDB flat can be due to upgrading, such as to make space for a new family member.

Other reasons could be to leverage the capital appreciation due to the release of the MOP restriction.

Once you have decided to move on, analyze both the transactions of resale units and recently transacted MOP units in your area.

I feel that it is best not to stick by this rule too closely, but to always observe recent sales transactions in your neighborhood. This will ensure that there is good demand, and a limited supply of flats to obtain the profit that you want. You can check on recent sales transactions at the HDB Map Services page.

The reason for this analysis is to correctly price your unit in the market so that it does not remain advertised for a long period of time. Testing the market with your highest offer tends to bring a lot of fatigue, and/or even worse, your unit is being used as a show-flat!

Renovation Works

Did you spend a hefty amount of money during the renovation process? If yes, be sure to account for it during the selling process. However, be realistic about the asking price as home buyers will consider purchasing your flat under two scenarios;

1) They will purchase the home as it is, and if the flat is still in good condition, might not require additional renovation works.

2) Your home might require additional renovation works, due to the possible wear and tear.

Under the first scenario, your home can be priced slightly above what previous transactions are asking for. A good ballpark figure will be to price it above the market by $15-$20k.

In the second scenario, MOP blocks can be considered to be new in comparison to their older resale counterparty. Major renovation works will not be required. The usual case will simply be just having a fresh coat of paint on the unit, which will approximately cost the home buyer around $1-$2k.

Seldom will the home buyer require hacking works for tiles and carpentry, but there might be instances where modifications to the layout of the space are done. I.e. hacking walls to create bigger rooms.

I will expect this sum to be around $10-$20k at most.

Accrued Interest

Using your CPF funds and grants, both of which contribute to the price of the flat means that there is an accrued interest of 2.5% on it, which will be contributed back into your CPF OA upon a sale. Interest is calculated based on the principal amount withdrawn for your housing needs on a monthly basis and compounded on a yearly basis.

This is fair enough considering that this is also the interest that is generated when the monies are left untouched in the CPF OA.

You are able to check on the accrued interest on your HDB flat at CPF e-services.

Who Can You Sell the HDB Flat To?

First-time BTO buyers are usually not aware of the Ethnic Integration Policy (EIP) and SPR Quota. This was set in place to ensure that there will be no aggregation of ethnic communities within the same neighborhood/block. To check if there are any restrictions, go to HDB Map Services.

HDB Map Services

From the example shown above, the quota for the Malay ethnic groups has been met, and therefore any homeowners from this block are only eligible to sell their flat to Chinese or Indian/Other Ethnic Groups buyers.

You do not want to go through the process of finding the right buyers, only to be dismayed when it does not go through.

Extension of Stay

Finding the right home after selling your present home takes time, and therefore there might be a need for a temporary extension of stay.

The usual process of resale completion will be about 8 weeks from HDB acceptance of the resale application.

It is best to inform the buyers of the HDB flat of your intention for a temporary extension of stay during the discussion of the sale price. The temporary extension of stay will be up to 3 months.

Lack of Funds for New HDB Flat?

Purchasing a resale HDB flat will require a huge cash/CPF outlay and for some home buyers, this might be a challenge. This is the purpose of the enhanced contra facility (ECF), as it helps facilitate the transfer of funds in a smooth process. All parties (Buyer and Seller) involved in the ECF should know that this process is being done.

As the buyer, however, you are only allowed to take an HDB loan, and bank loans are not allowed with the ECF.

Where to Next?

Deciding on your next home can be a tricky business and goes beyond the scope of this article.

My other articles should be able to help in your decision, should you be interested in Executive Condominiums (EC) or private properties.

If you are intending to purchase your next resale HDB flat, an interesting point to take note of is the Proximity Housing Grant (PHG).

The PHG is given when your next resale HDB purchase is for you to live with your parents/child or within 4km of the HDB flat or private property that your parent or child is currently living in.

To live within the same household, this figure can be $15,000(Singles) to $30,000 (Families).

To live near parents/child (within 4km), this can range from $10,000 (Singles) to $20,000 (Families).


The process of selling your BTO flat is straightforward, but it is important to plan it out ahead so as to ensure there are no hiccups throughout the sales process.

The usual motivations for a sale usually are to purchase a bigger flat for an incoming family member, or to further invest in a private property.

Once the reason for sale is clear, planning for the right marketing price ensures that enough funds are made available for your next property investment. This marketing price however should be realistic, based on past sales transactions and asking prices from other listings.

Having the right marketing price is also important as you will need enough cash on hand for the downpayment of your next property and having not enough can instantly derail your plans. Take note of the CPF accrued interest which will require funds withdrawn from your CPF account to be repaid back once the sale is completed.

Check if you require a temporary extension of stay of up to 3 months, and agree with your buyer on this during the discussion of the sale price.

Understand who you can sell the BTO flat to base on the EIP and SPR quota by checking the HDB Map Services.

If you are ready to take the next step forward, contact me so that I can aid you through the sale process. Contact me (Joshua) at +65 96329840 or send your queries to! My consultations do not have a charge, and it is a service outreach! I will not be pushing any products. Let us discuss the steps that you can take to achieve your property purchase goals.

The views, thoughts, and opinions expressed in the text belong solely to the author, and not necessarily to the author’s employer, organization, committee, or other group or individual. The author does not accept any responsibility whatsoever for any harm or loss arising from accessing or relying on information contained in this blog post.

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