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Saving up to pay for a BTO downpayment

11 Jul 2018 
SOURCE: CPF Board

​Saving up for a BTO downpayment might seem like a huge task, especially if you’re fresh out of school. Let’s see how Calvin and his girlfriend plan to buy their first home together.

Saving up to pay for a BTO downpayment.png
Both of them would like to live in a non-mature estate, where BTO flats can cost around $300,000 and up. Assuming they will be taking a HDB loan, the downpayment they will have to pay is 10% of the purchase price.


Using the average price of $300,000 for a BTO flat in a non-mature estate, the downpayment they will have to pay is $30,000. 

Based on their individual pay of $2,100, the amount of CPF contributed into each of their Ordinary Accounts (OA) every month is $483. Based on the current floor interest rate of 2.5% p.a., they will have $23,742.78 in combined OA savings after two years of working, including the interest earned! 

If they choose to use all their OA savings to finance their downpayment, they both have to save $260.72 in total each month to make up the difference. 

Tip: Since Calvin and his girlfriend are both under 30 years old, they qualify for the Staggered Downpayment Scheme, which allows them to pay 5% during the Signing of Lease Agreement and the last 5% when they collect their keys.   


 

Information accurate as at 11/7/2018

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