Your Second Property’s Downpayment and What You Need To Know Using CPF

Downpayment and using CPF for a second property

At some point in time, we will be looking for a home upgrade, or need extra space for our children to play and study? There are many reasons why homeowners would want to buy a second property.

Buying a second property without proper understanding and research may seem expensive and complex. For most of us, the biggest concern would be financials, working out how we can comfortably plan and ensure it is within our capabilities.

Downpayment and using CPF for a second property

Compared to 5% cash downpayment for the first property, 25% (cash) of the property value will be put down as your downpayment for the second property. 

All of this can be paid with a combination of cash and CPF. As with your first property, there are limitations on how much CPF you can use, as you still need to maintain a Basic Retirement Sum (depending on your age) before you can use any excess to pay off housing loans. There are also other limitations, for example, you can only use the savings from your CPF Ordinary Account. 

For a detailed breakdown and analysis, The CPF Housing Usage Calculator helps you estimate how much CPF you can use for your property – https://www.cpf.gov.sg/eSvc/Web/Schemes/CpfHousingUsage/Input1

Several conditions have been put in place for buying a second property. While the notion of passive income is appealing, cooling measures such as those highlighted could result in a purchase that is eventually stressful. It is therefore important to take these measures into account before buying a second residential property in Singapore.

The real value in hiring an agent is the fact that they give you a whole lot of convenience, and have more complete knowledge of the market and how to smoothly affect a property transaction (from purchase/sale to completion). Reach out to us if you need any further consultation or advice on any realty queries.

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