Building Under Construction

Progressive Payment Scheme for Buildings under Construction (BUC) Private Properties

Progressive payment scheme is to pay for your new private property, based on how much it has been built, and not the full price right off the start. For buyers who are well-planned, can enjoy a fully new built without having to pay the full mortgage while waiting for it to build.

 

New condominium also comes partially renovated and comes with cooking, fridge and washer so minimal spending on renovation and furnishing is required before moving in. New units also come with a Defect Liability Period of 12 months upon vacant possession, and developers are required to make good any such defects within one month.

How does Progressive Payment Scheme Work?

Once the developer finishes a stage in the construction, they will claim a certain percentage of the overall price from your lawyers, who will then arrange with you or your bank, depending on which stage and how much loan is covered by your bank. As banks disburse a higher percentage to developers, your monthly mortgage will scale up accordingly.

 

We have an outline of an estimation of how long each stage in the construction process will take. However, if there are any construction delays, the payment deadlines will also be pushed back.

Percentage of Purchases Price
Sale & Purchase Agreement stage
20% (including 5% booking/option fee paid)
Foundation works
10%
Reinforced concrete framework stage
10%
Brick walls stage
5%
Ceiling / rooking stage
5%
Doors, windows, electrical, plumbing and plastering stage
5%
Carpark, roads and drainage stage
5%
Notice of Vacant Possession, Temporary Occupation Permit / CSC
25%
Final Payment Date and/or Completion Date
15%
Estimated Construction Duration from Launch
Sale & Purchase Agreement stage
Foundation works
6 months
Reinforced concrete framework stage
6 months
Brick walls stage
3 months
Ceiling / rooking stage
3 months
Doors, windows, electrical, plumbing and plastering stage
3 months
Carpark, roads and drainage stage
3 months
Notice of Vacant Possession, Temporary Occupation Permit / CSC
12 months
Final Payment Date and/or Completion Date
12 months

Case Study

Andy and Selena purchased a BUC unit for $1,200,000.

Cash, CPF, and Bank loan breakdown as follows, assuming they have sufficient CPF and qualify for the maximum bank loan:

Cash (5%)

$60,000

CPF (20%)

$240,000

Bank Loan (75%)

$900,000

How much will they be paying for their monthly repayment for the first 4 years when the condominium is building?

Assuming an interest rate of 2% per annum
(current rates as of Feb 2022 are at ~1.1%) 

Estimated Construction Duration from Launch
Foundation works
6 months
Reinforced concrete framework stage
6 months
Brick walls stage
3 months
Ceiling / rooking stage
3 months
Doors, windows, electrical, plumbing and plastering stage
3 months
Carpark, roads and drainage stage
3 months
Notice of Vacant Possession, Temporary Occupation Permit / CSC
12 months
Buyers move in
Final Payment Date and/or Completion Date
12 months
Monthly Estimated Payment (SGD)
Foundation works
$222
Reinforced concrete framework stage
$665
Brick walls stage
$887
Ceiling / rooking stage
$1,109
Doors, windows, electrical, plumbing and plastering stage
$1,330
Carpark, roads and drainage stage
$1,552
Notice of Vacant Possession, Temporary Occupation Permit / CSC
$2,661
Buyers move in
Final Payment Date and/or Completion Date
$3,326

Whereas when buying a resale condominium, you must pay the monthly payments on the full mortgage upon ownership transfer.

Does all BUC unit offer Progressive Payment Scheme?

Yes. It is a regulation by the Government to protect buyers by ensuring developers do not make home buyers pay a hefty sum upfront before construction starts.

When do you start paying your mortgage?

Once your bank made the first disbursement to the developer, your home loan kicks in.

How do I know which stage is the Progressive Payment at for a specific development?

Buyers who already bought a unit will be updated as construction progresses.

For new buyers who are buying into a unit awhile after it launched, the information is not publicly available and only property agents who have access to the projects will know. You can find out about this information with us. 

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