When purchasing a private residential property in Singapore that is still under construction (commonly referred to as Building Under Construction (BUC)), buyers typically pay for the property using the Progressive Payment Scheme (PPS).
Unlike completed properties where the full purchase price is paid upfront (through a combination of downpayment and bank loan), the PPS allows buyers to pay in instalments that are tied to the different stages of construction. This means you only start paying more as the project advances.
How does the Progressive Payment Scheme work?
The PPS is structured according to the construction milestones of the project, as certified by the developer’s architect. Payments are released progressively to the developer. Below is the general timeline of payment stages:
Booking Fee (Option to Purchase)
Usually 5% of the purchase price, paid in cash.
Exercise of Option / Downpayment
Within 8 weeks, the Sale & Purchase Agreement is signed, and buyers complete a total of 20% payment (less the booking fee).
This can be paid using CPF OA savings and/or cash.
Subsequent Instalments (via Bank Loan / CPF OA / Cash)
Payments are made progressively as the building reaches certain stages of completion:10% upon completion of foundation works
10% upon completion of reinforced concrete framework
5% upon completion of partition walls
5% upon completion of roofing
5% upon completion of plumbing, electrical works, door & window frames
25% upon completion of the unit (when the Temporary Occupation Permit is issued)
15% upon legal completion (when Certificate of Statutory Completion is issued)