Introduction
What is a Progressive Payment Plan? A progressive payment plan is a payment schedule linked to the construction stages of your new condo. Instead of paying the total price upfront, payments are ‘progressive’, meaning they are made in installments as the construction progresses.
The Stages of Progressive Payment
| Est. Time Frame | Stages | Payment | Description | Payment Method |
|---|---|---|---|---|
| At Booking | Booking Fee | 5% | Upon exercising of option. Prepare for some additional costs such as engaging a solicitor (~$3000) and mortgage loan stamp duty (~$500) | Cash |
| Within 8 weeks | Downpayment | 15% | Remaining downpayment + any buyer stamp duty & additional buyer stamp duty if applicable | Cash/CPF |
| 6-9 months | Foundation Work | 10% (5%+5%) | Foundation work is completed. | Cash/CPF/Bank loan |
| 12-18 months | Reinforced Concrete Framework | 10% | Upon completion of the reinforced concrete framework. | Cash/Bank loan |
| 15-24 months | Partition Walls | 5% | Brick/Partition walls are done. | Cash/Bank loan |
| 18-30 months | Ceiling/Roofing/Top Floor | 5% | The ceiling, roof, or top floor is completed. | Cash/Bank loan |
| 21-36 months | Door, window frames, wiring, internal plastering, and plumbing of unit | 5% | Interior works such as Door and window frames in position, wiring, internal plastering, and plumbing of unit | Cash/Bank loan |
| 24-42 months | Carpark, Roads, and Drains | 5% | Finishing of external works such as carpark, roads, and drains. | Cash/Bank loan |
| Notice of vacant possession | Temporary Occupation Permit (TOP) | 25% | The property has been completed in all respects | Cash/Bank loan |
| Legal completion date | Date of legal completion/certificate of statutory completion (CSC) | 15% | Property has been completed in all respects | Cash/Bank loan |
Note: The estimated time frames are indicative and may vary depending on the project’s progress and construction schedule.
Benefits of a Progressive Payment Plan
Financial Flexibility
It allows you to stagger payments, providing financial flexibility.
Lower Initial Investment
The initial outlay is lower compared to a fully constructed property.
Linked to Construction Milestones
Payments are linked to construction progress, ensuring your investment is in sync with the project development.
Potential Capital Appreciation
As the project nears completion, the property value might appreciate, offering potential gains.
Things to Consider
Loan Disbursements
Understand how your bank disburses loans at each stage.
Construction Delays
Be prepared for potential construction delays.
Market Risks
Keep in mind the property market risks and trends.
Conclusion
Navigating the purchase of a new condo launch in Singapore can be both exciting and complex, especially when it comes to understanding and managing your finances. The progressive payment plan offers a manageable and structured way to finance your dream home, aligning payments with the construction milestones.
As a seasoned property agent specializing in new condo launches, I understand the nuances of these investments and am here to guide you through every step of the process. If you’re considering a new launch condo and want expert advice tailored to your unique situation, don’t hesitate to reach out. Together, we can find the perfect home that fits your lifestyle and financial goals.
