Should You Buy A Home with the Current Market Conditions? Tips to Navigate High Interest Rates, BTO Delays & More

DBS Property Marketplace, Home and Living Marketplace

This post was written in collaboration with DBS. While we are financially compensated by them, we nonetheless strive to maintain our editorial integrity and review products with the same objective lens. We are committed to providing the best information in order for you to make personal financial decisions with confidence. You can view our Editorial Guidelines here.

Since time immemorial, buying a home has been a rite of passage for many Singaporeans. It often means moving out for the first time, getting married and erm…getting into debt for 25 years… yay.

The current property situation in Singapore isn’t exactly reassuring, since prices have been climbing skywards with zero regard for cooling measures and the ongoing pandemic. On top of all these, BTO delays are STILL affecting homebuyers, meaning it’s an even longer wait before getting the keys to your flat.

What’s more, in the wake of Fed interest rate hikes, Singapore interest rates are going through the roof too. That means everything from home loans to renovation loans is going to get more expensive, not to mention home items like furniture and utility bills.

The result is that lots of would-be first-time home buyers and even home upgraders have been pushed to opt for alternatives like renting, resale flats, delaying their purchase, not going ahead with their upgrading plans, or even turning to private housing. That last one could explain why private housing prices have gone through the roof.

2022 is definitely a tough year to buy a home. Here are some tips to help you navigate the hurdles successfully and smoothly before, during and after buying a home.


1. Plan your finances right from the beginning

Planning your finances begins well before you buy a home.

For starters, here are some things you need to do:

  • Look at your bank and CPF balances to determine how much you can pay in cash and CPF savings (include your partner in the conversation if you’re buying a home together)
  • Work out the maximum amount you can afford, including downpayment, monthly instalments and additional costs like legal fees and stamp duty
  • If you’re going for a bank loan, apply for In Principal Approval (IPA) to ensure your affordability before setting your heart on a home
  • For each property you have shortlisted, work out how much your downpayment will be as well as the cash portion, and calculate your potential monthly instalments
  • Research and compare home loans to find one with terms and rates that meet your needs

You can plan your finances on DBS Property Marketplace using a variety of tools such as the MyHome planner, which lets you work out the affordability of a property you’re interested in.

These tools on DBS Property Marketplace include Property Budget, which helps you plan your finances; Cashflow Timeline, which lets you manage your cashflow and all the different payments that must be made; and Repayment Calculator, which helps you work out your home loan repayments.

Screenshots via DBS Property Marketplace


2. Speak to fellow home owners & get an IPA

If you’re a first-time home owner, it can be very helpful to speak to others about their home ownership journey, especially in 2022 when we’re facing so many uncertainties and the pandemic isn’t even over yet.

So quiz your friends who’ve already taken the plunge and bought their own homes. Check out their space or neighbourhood, find out more about renovation and get them to recommend some of their favourite product and service providers.

All this can seem very kaypoh, but in-depth background research can really help, especially when you’re a newbie and your mind is a blank slate.

Also, for peace of mind, it’s always a good idea to apply for In-Principal Approval (IPA) with DBS. This can be done before you even commit to a home purchase, and enables DBS to confirm the amount of money they may be willing to lend you for a particular property. When you have your IPA, you can then proceed with the purchase with peace of mind, knowing that your financing is covered.


3. Plan for various budgets when looking for your ‘dream home’

While searching for your “dream home”, remember that expectation doesn’t denote reality. FWIW (for what it’s worth), it’s better to stay flexible and open to the possibility of more than one budget, and to plan for more than one scenario — you never know, you might fall in love with a place that’s a little more or less expensive than what you had originally anticipated.

DBS Property Marketplace allows users to search for a dream home within their budget. What sets it apart from other property databases is that it offers a more structured experience. Instead of browsing aimlessly, you can systematically look through various home listings aligned to your budget and save your favourites.

You also get to enjoy competitive loan options with the DBS HDB Loan and Two-In-One Home Loan. What’s more, if you have a DBS Multiplier Account, signing up for a DBS home loan lets you unlock higher interest rates.


4. Go deal-hunting to save money

Home renovation, furnishing and other services can cost a pretty penny, especially if you’re hacking a resale HDB flat, doing major works or have an elaborate design in mind.

Interior designers are a mixed bag in Singapore, with some bordering on the scammy. So, focus on making sure they are professional, reliable and approved by HDB.

Other than word of mouth and manually checking background info online, you can also run a search on DBS Home and Living Marketplace, which only lists approved interior designers and enables you to get free quotes from firms with no strings attached. Launched since 2018, the portal was recently rebranded to include the Renovation, Furnishing and Services pillars, and now offers lots of exclusive deals, promotions, products and services.

When furnishing your home, it’s a good idea to scout for deals in physical shops that let you store the furniture or appliances for a few months until your home is ready. Common sale periods or annual fairs/expos held by big chains can offer opportunities.

If you are able to, you can also join forces with new neighbours to look for groupbuy deals. Oh, and did you know that the DBS Home and Living Marketplace offers appliance subscriptions? So that you can try them out to make sure you like and WILL use them before you actually buy! This is also a fantastic service for those in temporary home rentals while waiting for their BTO (sigh…the delays).

Not fussy and/or want to be more eco-friendly? Opt for display pieces or turn to second hand stores — just make sure you carefully check the condition of the items before buying.

If you buy more than one item from the same shop, you might be able to negotiate with the salesperson to knock a few bucks off your total purchase or buy things in a bundle deal.

You can also check with friends or family to see if anyone can get you direct discounts or staff prices at shops or service providers. You just might get a discount on your new air conditioning system or interior design package!

You can also easily search for sustainable items, such as bathroom products, and furnish your new home on DBS Home and Living Marketplace.

Finally, don’t forget to use credit cards to pay and reap rebates, rewards and points!


5. Don’t forget the running costs of home ownership!

Buying a home and renovating it are just the first steps on your journey as a homeowner. You’ll also have to deal with the running costs of home ownership, including the cost of electricity, water/gas/utilities, food, internet/broadband, TV subscription, maintenance (if needed), cleaning supplies, hygiene supplies and other consumables in the home.

How much you spend will depend on the size of your home and your usage patterns. For me, I roughly set aside at least $500 to $1,000 a month for the above.

Read more: Cost of Living in Singapore (2022) — Is Your Salary Really Enough?

To save you some money, DBS Home and Living Marketplace offers a wide range of electricity and broadband deals that can help you survive inflation and the recent electricity price hike.

To save even more money as you grapple with the costs of adulting, consider cooking at home or eating at hawker centres more often and shopping for household products when there are deals — for instance, you can look for vouchers or new-user deals online, buy in bulk to save money or share bulk purchases with neighbours AKA groupbuy.

As always, don’t forget to use credit cards strategically to earn rebates, rewards and points!

Hot tip: Enjoy exclusive deals and rebates when you use a DBS/POSB card with DBS’s promo codes. What’s more, if you’re a POSB Everyday Card holder, you enjoy rebates of up to 3% when you set up recurring payment for your utilities and telecommunications bills on the card.

You can also apply for comprehensive home insurance to protect your home through DBS thanks to plans such as myHome Protect II. Home insurance is different from compulsory HDB fire insurance and is meant to protect your home, renovations and belongings.


6. Last but not least, remember to chill

Home ownership is a big project and can be stressful. It can take a few years to really come to grips with the costs.

The good news is that with proper planning, you can make the journey a lot less scary. All big projects, especially in this tumultuous 2022, don’t go 100% according to plan, but with a bit of preparation and flexibility you can do a lot to alleviate the stress.

So, make sure you use tools and resources available to you, such as DBS Property Marketplace, DBS Home & Living Marketplace and advice from friends and family to help you along.

In the end, regardless of the current market conditions, whether you decide on buying a house boils down to practical considerations, such as the urgent need for more space to start your family. Just remember to make savvy decisions that won’t burn a hole in your pocket!