Laws of buying and selling property in Singapore

The laws regarding the ownership and sale of real estate are transparent and fairly standard. However, due to escalating prices and favoring their own citizens, foreign investment is strictly regulated.

General laws of purchase and sale.

The main legal instrument that governs the purchase of real estate is the Residential Property Law (RPA). For property sales, the primary laws are governed by the Home Developers (Control and Licensing) Act (HDCLA) and the Commercial Property Sales Act.

Laws of purchase and sale of property and foreign investment

Applicable legal provisions

Foreigners are not permitted to purchase all residential property titles in an approved building or condominium building without the approval of the Minister of Justice. An application may be favored if the foreign buyer is a permanent resident or a qualified professional who can contribute to the well-being of the economy.

• They are not allowed to purchase or own restricted housing except by mortgage, charge or transfer only.
• They cannot offer goods as a gift to a foreign compatriot.
• Transactions carried out by foreigners that contravene the Residential Property Law will be considered null and void.
• Foreigners cannot buy land in Singapore except on Sentosa Island.
• Legal restrictions on the purchase and ownership of real estate

Unsurprisingly, in terms of ownership, Singapore’s laws are biased towards its citizens who are empowered to freely acquire and own land and residential property. Organizations and foreigners, on the other hand, have very limited ability to purchase and own real estate.

Purchase and Ownership Restrictions

Companies, associations and partnerships in Singapore must apply for permission from the controller of the residential property.

Foreigners with permanent resident status, foreign companies, limited partnerships, and partnerships may freely purchase unrestricted residential properties such as:

• Any flat for residential purposes, but not a dwelling house on any land
• Any unit in an approved condominium building
• Any executive unit in a project sold under an executive scheme.

Legal restrictions to develop and sell

The relevant provisions of the HDCLA are the primary control over how land is developed and sold for housing purposes.

Development and sale restrictions.

A licensed home developer is the only person authorized to develop and sell more than 4 housing units.

The Housing Comptroller is empowered to formulate the type of contract to be used with additional powers to approve any modifications made to the contract. Any contravention by the promoter will be considered as an infraction.

The sale of commercial buildings is controlled by the Sales of Commercial Property Act (SCPA) and the contracts for these sales are also approved by the Housing Comptroller.

4-unit buildings do not fall within the scope of the SCPA, but they do thwart a foreign developer’s ability to expand development activities.