Guide to Buying a New Launch Under Construction (BUC)

For educational purposes only. All copyrights belong to their respective owners.

Should You Buy a Building-Under-Construction Property?

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Understanding Building under Construction (BUC) Loans in Singapore

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Progressive Payment Schedule for Building under Construction (BUC) properties

Under the progressive payment scheme, the drawdown of your mortgage is scheduled into various stages as shown in the below following table:
Stage
Payment under a standard payment scheme ( % of purchase price )
Upon the grant of Option to Purchase 5% – 10% (booking fee)
Upon signing of the Sale & Purchase Agreement or within 8 weeks from the Option date 20% less booking fee
Completion of foundation work 10%
Completion of reinforced concrete framework of unit 10%
Completion of partition walls of unit 5%
Completion of roofing/ceiling of unit 5%
Completion of door sub-frames/ door frames, window frames, electrical wiring, internal plastering and plumbing of unit 5%
Completion of car park, roads and drains serving the housing project 5%
Temporary Occupation Permit or Certificate of Statutory Completion 25%
On completion date 15%
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Understanding Building under Construction (BUC) Loans in Singapore

Why do people want to buy properties still under construction? After all, there are more risks involved in purchasing an uncompleted house versus a completed one. Who knows? The developer may go bust before the property sees the light of day.
Well, the “early bird catches the worm” mentality is at play here. Some buyers want to grab the best units: units with the most beautiful views, etc. But more often than not buyers are motivated by the monetary savings that comes with early purchases. Developers dangle early-bird perks such as a per-square-foot discounts, or the absorption of stamp duties or other administrative costs.
For whatever reasons you are buying a BUC house, you will likely finance it with a loan. This article provides some useful information about BUC loans.
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Buying property in Singapore: Purchasing property under construction

How are you protected?

The developer is required by law to provide properties that are free of defects, and you have a year’s warranty for them to fulfill their obligations.
If the unit ends up bigger than the original floor plan, the purchaser does not pay extra; but if it ends up more than 3 percent smaller, the developer must recompense you pro rata at the original price per square foot.
The developer may not deviate from the approved plan without approval from the BCA (Building and Construction Authority). If he uses cheaper materials or omits work he must reduce the price accordingly.
If the building differs substantially from the plans, you can pull out of the agreement and demand a full refund, plus interest at 10 percent per annum

Property Buying Guide – New Launch Building-under-Construction Condo

Buying a property in Singapore is a major investment, and buying a building-under-construction BUC properties heightens the risk. There’s no transaction history for you to check, and no way of knowing if the developer will fulfill the marketing hype. Still, you may be convinced by the lower initial costs, or by the high demand for a hot property, or a potential hot new area helmed by the future master plan. If that’s the case, then here’s what you better look for, before forking out the Option to Purchase or Sales and Purchase Agreement:
What is an Building-under-development condo?
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Common Terms in Sale & Purchase Agreements

You may now have a better understanding of the whole process of buying a house after reading about theconveyancing process. You put down your option fee, happily waiting for your chance to sign off on your new housing purchase. Some days later, you then receive a stack of dauntingly thick and wordy documents for your signing. Fret not, for in this article, we will guide you through the salient terms which you should take note of in your Sale and Purchase Agreement for the purchase of your EC (Executive Condominium) or Condominium unitin a building that is still under construction.
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