Many Singaporeans aspire to upgrade to a private property while holding on to their HDB flat—whether for rental income, legacy planning, or future flexibility. But is it really possible? The answer is yes, if you plan strategically and understand the rules. In this guide, I’ll walk you through the key eligibility conditions, financing strategies, and common pitfalls—so you can confidently explore how to make this happen.
Understanding the Rules: HDB vs Private Property Ownership
For Singapore Citizens:
You are allowed to own both an HDB flat and a private residential property only after fulfilling the Minimum Occupation Period (MOP) of five years. Once the MOP is completed, you can legally purchase a private condominium without having to sell your HDB flat.
For Permanent Residents (PRs):
PRs are not allowed to own both. If you’re a PR, you must sell your HDB flat within six months of acquiring a private residential property.
Tip: Make sure your MOP is officially reflected in HDB’s records before proceeding with any purchase.
Financial Considerations: Can You Afford to Hold Both?
Before committing to owning both a condo and an HDB, you must evaluate your financial readiness.
Key Financial Factors:
- Additional Buyer’s Stamp Duty (ABSD): 17% for Singaporeans purchasing a second residential property.
- Downpayment: At least 25% of the condo’s price, including a minimum of 5% in cash.
- Loan-To-Value (LTV): If you already have an outstanding home loan, your LTV for the second property drops to 45% (or 25% if the loan tenure exceeds the stipulated limits).
- Total Debt Servicing Ratio (TDSR): Your total monthly debt repayments cannot exceed 55% of your gross monthly income.
Suggested Solution: Speak to a mortgage specialist early to understand your financial limits before house-hunting.
Strategic Approaches to Buy Without Selling Your HDB
Assuming you’ve fulfilled your MOP, here are a few possible strategies for holding on to your HDB while purchasing a private condo:
Option 1: Owner-Occupier Scheme from the Start
While decoupling (i.e., transferring ownership of an HDB flat between spouses) was once a common strategy, HDB disallowed this for married couples from 1 April 2016. Therefore, decoupling is no longer a viable option in most cases.
However, couples can plan from the very beginning by purchasing their HDB under the owner-occupier scheme, where one spouse is the legal owner and the other is listed as an occupier. This structure may allow the occupier to purchase a private property later under their own name, after fulfilling their MOP.
Important: This requires careful financial planning and should be decided right at the start of your property journey.
Option 2: Buying Under a Trust for a Child
Another approach is to purchase a condo under a trust for your child. However, this route comes with strict requirements:
- The purchase must be fully paid in cash.
- A 65% ABSD (Trust) must be paid upfront at the time of purchase.
- Buyers can apply for ABSD remission later, but it is subject to IRAS’s approval and specific criteria.
Caution: This strategy is suitable primarily for ultra-wealthy or cash-rich families. Legal and tax implications are significant. Always seek advice from a qualified law firm or estate planning professional before proceeding.
Option 3: Sell and Buy Another HDB Under Owner-Occupier Scheme
There are cases where a HDB owner may choose to sell their current HDB flat and purchase another resale HDB under the owner-occupier scheme. This can be done if one spouse buys the new flat as the sole owner, and the other is listed as an occupier.
This arrangement, if planned early and executed correctly, allows the occupier to later purchase a private property after meeting their MOP.
Important: This strategy requires proper timing, financial consideration, and eligibility checks. It’s not suitable for everyone but can work well for couples who have a long-term property plan.
Rental Strategy: Monetise Your HDB
If you’re planning to move into the condo, you may consider renting out your HDB flat—but only after the MOP is met. HDB rental can provide a stable stream of passive income to offset your condo mortgage.
When It May Not Be Feasible
Some common roadblocks include:
- Insufficient CPF or cash savings
- High existing loan liabilities
- Failure to meet MOP
- Exceeding the TDSR limit
Pro Tip: Always work with a real estate consultant to assess your eligibility and avoid unexpected pitfalls.
Conclusion
Owning both an HDB and a private condo is a real possibility for Singaporeans—with the right knowledge, preparation, and financial prudence. From meeting your MOP requirements to managing ABSD and structuring your purchase legally, the process can be smooth if you plan well in advance.
