The 2024 Master Guide to HDB Resale: From Start to Closing

To maximize your returns when selling your HDB resale flat in 2024, it's crucial to adhere to the insights and steps outlined in this comprehensive guide. Ensuring that your flat has completed the Minimum Occupation Period (MOP) of 5 or 10 years, as required, before embarking on this journey is fundamental.

Warren Buffett, one of the most successful investors of the 20th century, famously said, "The more you learn, the more you earn." This wisdom holds profound truth in the realm of property sales as well. Educating yourself about the nuances of the resale process, market trends, and legal requirements not only empowers you but also significantly enhances your potential to increase your net worth through strategic decisions.

This guide is designed to serve as your educational tool, equipping you with the knowledge and strategies needed to navigate the complexities of the HDB resale market confidently. By understanding the key factors that influence the value and desirability of your property, you can make informed decisions that align with your financial goals, ensuring a successful and profitable sale in 2024.

Step 1: Register Intent to Sell

To start selling your HDB flat, the first step is to let HDB know you want to sell. This step is called Register Intent to Sell.

Here's how you can do it in a few easy steps:

1. Visit the HDB Resale Portal online.

2. Choose "I am a Buyer or Seller."

3. Log in using your Singpass.

Right after you register, you'll find out:

• If you're allowed to sell your flat.

• The rules about who can buy your flat, based on the Ethnic Integration Policy and if they are Singapore Permanent Residents.

• Any updates on improvements to your block and how much you need to pay for them.

• Prices of HDB flats nearby that were sold recently.

Remember, your Intent to Sell is good for 12 months (that's 1 year). Make sure to submit the HDB resale application within this time. If you wait too long, you'll need to start this step over.

Step 2: Calculate Cash Proceed

Being grounded in reality is key, and the best way to do this is by working out the numbers yourself. You can get a thorough breakdown of how much you might earn from selling your HDB flat here.

Figuring Out Your Cash Earnings

Here's how you do the math: Take the Selling Price, then subtract the amount you need to pay back to your CPF, and also subtract any money you still owe on your loan.

How to Find Out What You Owe on Your Loan

• If you have a loan from a bank, get in touch with them to find out.

• If your loan is with HDB, you can find this information by going to HDB.gov.sg, then to "My Flat" and "Financial Info."

How to Work Out What You Need to Pay Back to CPF

Log in at CPF.gov.sg, go to "myCPF," and then "Home Ownership."

How to Decide on a Selling Price

• Use the HDB Map service to help figure this out.

• You can also scan the QR code at realestatedad.sg/free-tools for more help.

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Step 3: Post your HDB resale flat for sale

After letting HDB know you're ready to sell your flat and getting an idea of how much you might earn from the sale, it's time to introduce your flat to potential buyers.

When you share your flat online, you'll need to show pictures. Here are some tips to make your flat look its best:

Tidy Up: Make sure every room is neat and clean.

Pillow Fluffing: Give your pillows a good plump to make seating areas inviting.

Remove Personal Items: Take away family photos or anything super personal to help buyers imagine living there.

Stage Your Home: Arrange your furniture and decor to show off your flat's best features. By placing the furniture towards the wall, it will make the house look bigger.

Extra Tip: Consider hiring a professional photographer and videographer. They know how to use lighting and angles to make your flat look amazing in photos and videos. Good pictures can really grab attention and make people excited about your flat, possibly even starting a little competition to buy it!

Step 4: Arrange viewings and conduct negotiations

Arranging viewings and conducting negotiations are critical steps in selling your HDB flat. How you manage these can significantly impact the level of interest from potential buyers and the final sale price.

Here are some strategies and insights to create excitement and a sense of urgency, often referred to as the Fear of Missing Out (FOMO):

Arranging Viewings

Open House Strategy: Consider scheduling an open house instead of individual viewings. This approach not only saves time but also subtly creates a competitive atmosphere among potential buyers when they see others interested in the same property.

Optimal Timing: Schedule viewings during times when your flat looks its best. Natural light can play a significant role in enhancing the ambiance, so aim for times of the day when your flat is brightly lit.

Highlight Key Features: Prepare a short tour that highlights the best features of your flat, such as a renovated kitchen, spacious balcony, or scenic views. Make sure these areas are spotless and staged well.

Personal Touch: Adding small personal touches, like fresh flowers or a scented candle, can make the space more inviting and create a lasting impression.

Conducting Negotiations

Preparation is Key: Before entering into negotiations, know the lowest price you're willing to accept. This preparation will help you negotiate with confidence.

Create a Sense of Demand: If there are multiple interested parties, subtly let each party know (without revealing specifics) that others are also considering the property. This knowledge can encourage quicker and higher offers.

Be Responsive: Quick responses to offers or inquiries show that you're serious about selling and can keep the momentum going.

Flexibility: While you should have a clear bottom line, being flexible on other terms (such as the move-out date) can make your flat more attractive to buyers.

Professional Assistance: Engaging a skilled real estate agent can be beneficial. They bring negotiation expertise and can often secure better terms due to their experience and negotiation skills.

Before granting the Option to Purchase (OTP) to your buyer, there are 3 things that need to be fulfilled first

1. You need to complete the Intent to Sell at least 7 days before granting the Option to Purchase (OTP).

2. The buyer will need to have a valid HDB Flat Eligibility (HFE) letter before you can grant the OTP.

3. If the buyer intends to get a bank loan, he/she must have a Letter of Offer before he/she can exercise the OTP.

Step 5: Discuss Temporary Extension of Stay with HDB buyer

You might need a little more time to move out of your flat even after it's sold. If that happens, you can request for a "Temporary Extension of Stay" as a term before selling your flat. The buyer of your flat also needs to agree to this when they apply to buy it.

Think of it like asking the buyer, "Can I stay a bit longer, please?" If they say yes, you can live in your flat for up to 3 more months after the sale is all done.

When You Might Need This Extra Time

• If your new home isn't ready yet and you need a place to stay.

• If you're waiting for the sales proceed to be returned first before you can purchase the new home

When You Won't Need the Extra Time

• If your new home is ready and you can move in right away.

• If you have another place to stay as soon as the sale is complete.

Step 6: Grant Option to Purchase (OTP) to HDB buyer

After reaching an agreement on all conditions, you can officially provide the HDB buyer with the Option to Purchase (OTP). The act of issuing the OTP signifies your formal acceptance of the buyer's proposal, encompassing all aspects such as the agreed sale price, option and exercise fees, as well as timelines for submission and potential extensions.

As mentioned before, you need to complete the Intent to Sell at least 7 days before granting the Option to Purchase (OTP). The official OTP document can be accessed for download via the HDB resale portal.

It's important to note that once the OTP is issued to a prospective buyer, you are bound by it and cannot accept any offers for 21 days.

Upon issuance of the OTP, you are entitled to receive an Option Fee from the buyer, which can range between $1 and $1,000. (Market practice is $1000) This fee is non-refundable if the buyer decides against completing the purchase of your resale flat. Therefore, it is crucial to ensure your complete satisfaction with every term of the agreement before proceeding with the OTP.

Step 7: Buyer will exercise the OTP and pay the Option fee

Once you and the buyer have agreed on the sale price and discussed any necessary arrangements for staying a bit longer in the flat (the Temporary Extension of Stay), the buyer will go ahead and 'exercise' the OTP. This means they'll confirm their intention to buy and pay you the exercise fee. This fee, added to the earlier Option fee, makes up the deposit, which can't be more than $5,000 in total. For instance, if the Option fee was $1,000, then the exercise fee would be no more than $4,000.

Remember, the OTP is only good for 21 days. The buyer needs to make their decision within this time frame, up until 4 p.m. on the 21st day, which includes weekends and public holidays.

What happens if the buyer changes their mind?

There might be times when a buyer decides not to go through with the purchase after all. If this happens, the OTP will no longer be valid after its expiration, and you'll be free to show your flat to other interested buyers. The Option fee paid by the buyer will not be returned to them.

Why might a buyer back out?

Potential buyers might reconsider their decision for several reasons, such as not securing the desired loan amount from the bank, unexpected personal circumstances, or finding another property that better fits their needs. When they back out, the Option fee they paid is forfeited, meaning you keep it as compensation for the time the property was off the market.

Step 8: Hiring a Lawyer for Property Transfer

The term "conveyancing" refers to the legal process of transferring the ownership of your flat to someone else. This important step typically includes:

• Making sure there are no remaining loans or legal issues with your flat that would prevent it from being sold.

• Agreeing on and finalizing the sale details, including the conditions outlined in the OTP.

• Officially recording the new ownership with the authorities, which might mean you need to pay certain taxes or other charges.

If you have a loan from a bank for your flat, you'll also need a private conveyancing lawyer to help adjust or settle your loan.

There are two main ways to find a conveyancing lawyer:

1. Use HDB's legal services. You can check how much it might cost by visiting the HDB website and using their Legal Fees Enquiry tool.

2. Consider a lawyer we suggest if you're looking for someone outside of HDB's services.

When to use a private lawyer for conveyancing in the sale of your HDB flat 

Complex Transactions: If your sale involves more complex elements, such as dividing assets between parties, dealing with unusual legal issues, or coordinating with multiple stakeholders

Bank Loans: If you have an existing bank loan on your property, a private lawyer can assist with the refinancing process or the discharge of the mortgage, ensuring all legal requirements are met and the transition is smooth.

Convenience and Efficiency: For a more seamless and hassle-free process, especially if you are unable to attend to various procedural requirements personally, a private lawyer can handle all aspects of the conveyancing process, including document submission, financial transactions, and liaising with HDB and other parties.

Step 9: Submit HDB resale application

You're almost there! You're reaching the final part of selling your HDB flat. Now, both you and the buyer need to fill out the resale application on the HDB resale portal. Here's the catch: You both have to submit your applications separately, and they need to be done within 7 days of each other. This means you'll need to coordinate with the buyer to decide when to do this.

When you're filling out the HDB resale application form, you'll need to include:

• The address of the flat you're selling

• Details from the OTPA digital copy of the OTP

• Your personal information

For submitting your HDB resale application, there's a fee to pay. It's $40 for smaller flats (like 1- and 2-room flats) and $80 for bigger ones (3-room flats and larger).

And don't worry about keeping track of everything. You can easily check how your application is doing by visiting the HDB resale portal.

To make things smoother for you, the fee you pay for submitting your application will also cover my professional services. This way, everything is handled together, making the process simpler for you.

Step 10: Endorse HDB resale documents

Within 3 to 5 weeks, HDB will send you a text message. This message will let you know when you can go online to the HDB resale portal to agree to the terms and conditions of all the documents they've prepared for your flat sale.

You must complete this step, which means you agree to all the documents, within 6 days after you get the message.

Once it’s been endorsed, you will receive an in-principle approval for your HDB resale flat.

Step 11: Pay legal fees and other HDB resale costs

You're almost there!

Now that you've got the paperwork sorted, the next step is handling some payments. If you're using HDB's legal services, you can find out how much it might cost by checking the HDB website's Legal Fees Enquiry section. But if you've hired your own lawyer from a law firm, they'll tell you about the fees you need to pay.

There's also a fee for submitting your HDB resale details:

• $40 for 1- and 2-room flats.

• $80 for larger flats, like those with 3 rooms or more.

After paying these fees, an HDB flat inspector will get in touch with you within two weeks.

HDB flat inspection

Technical Executives from an HDB branch will come down to inspect your flat for any structural damages and unauthorised modifications. This is to ensure that your apartment does not compromise the integrity of the entire building or the safety of the new flat owners.

They'll visit to check your flat, focusing on a few important things:

Windows: The inspector will look at your windows to make sure they're safe and not worn out.

Illegal Hacking: They'll check for any changes made to the flat that weren't allowed.

Bomb Shelter: The bomb shelter needs to be in good shape, with the door and air vent working properly.

If the inspector finds any problems, they'll ask you to fix them before the sale can be completed. If these issues aren't sorted out, the sale will be delayed.

If you can't be there for the inspection, someone else can be there instead if you've given them a Power of Attorney. That means you've legally allowed them to act on your behalf.

Step 12: Receive HDB approval letter

Great news! You're just three steps away from completing the process! After the flat inspection, keep an eye out for a text message or email from HDB. This message will tell you that HDB's approval letter is ready for you to view on the HDB resale portal. This is a positive sign, showing that your sale is moving forward smoothly.

Your meeting with HDB is scheduled for 8 weeks after they accept your resale application, but that's only if all the needed paperwork is submitted correctly and on time. So, make sure everything is in order to avoid any delays.

Step 13: Get Ready for the Final HDB Meeting

We're almost there! As you gear up for the final step, your HDB resale completion appointment, here's what you need to do:

Sort Out Renovations: If you've made any changes to your flat that weren't approved, now's the time to fix them.

Wrap Up Payments: Stop any automatic payments from your bank account for things like your flat's monthly bills. Also, make sure you've paid up any money you owe for your flat, like the property tax for the whole year and the monthly charges for keeping the common areas clean and in good shape, all the way up to the day your flat sale is officially done.

Move Out: Plan to leave your flat before the final meeting day so the new owner can start moving in without delay. Once you've moved out, be ready to give the keys to the new owner when you meet for the last time at HDB.

Step 14: Attend the Final HDB Meeting

You're at the final stretch of selling your HDB flat! The last step is to go to the HDB Hub for your Resale Completion Appointment. Here's what will happen:

Sign Important Papers: You'll sign the document that officially transfers your flat to the new owner. If you have an HDB loan, you'll also sign a mortgage document.

Key Handover: You'll give the keys to the new owner. If they're using a bank loan, the bank's lawyer might come to pick up the keys instead.

Receive Your Money: After the meeting, HDB will issue a cheque of the cash proceed. Any CPF funds you used will be put back into your CPF account within 10-14 days.

Important Reminders:

The deal could be called off if you or the buyer decide not to go through with the sale, if either of you cancels your application, or if there's a problem with the money for the purchase.

Make sure all the information you've given is correct and complete. If there's a mistake or something's missing, it could cause problems.

You and the buyer must meet all of HDB's rules to go ahead with the sale.

Additional Tips:

Double-Check Everything: Before your appointment, make sure all documents and requirements are in order. It's better to be over-prepared than to face delays.

Ask Questions: If anything is unclear during the appointment, don't hesitate to ask for clarification. This is your final chance to ensure everything is as it should be.

Plan for the Funds: Think about what you'll do with the sale proceeds. If you're buying another property, ensure you've planned for that transition.

Celebrate: Selling an HDB flat is a big deal. Once everything is done, take a moment to celebrate this significant milestone!

Congratulations on reaching the end of this guide!

Congratulations on reaching the end of this comprehensive guide to selling your HDB flat! You've navigated through the complexities of the HDB resale process, from initial preparations to the final handover of keys. This journey requires patience, attention to detail, and a bit of savvy negotiation, all of which you've managed beautifully.

As you move on to your next adventure, remember that every step in this process has been a steppingstone towards new beginnings. Whether you're upgrading, downsizing, or simply changing scenery, the future is bright and filled with possibilities.

And now, for a little humor to celebrate your achievement: Why did the HDB flat go to therapy? Because it had too many "storey" issues!

Thank you for trusting this guide to assist you through the resale process. May your next chapter be as rewarding and fulfilling as the journey you've just completed.

Let me help you to sell your HDB resale flat in 2024

Empowering your decisions with expert knowledge is the cornerstone of our approach. If you're seeking clarity and confidence in your HDB resale journey, the opportunity to connect is just a click away. Our team, armed with insights and strategies proven in the marketplace, is ready to guide you through each step, ensuring your experience is seamless and successful. Join the ranks of informed sellers who have transformed their aspirations into achievements. Reach out now—your informed decision-making begins here.