Using CPF Savings for Property Purchase in Singapore

Jul 02, 2024By Zen

Using your CPF savings to buy a property in Singapore can make home ownership more affordable. The Central Provident Fund (CPF) is a compulsory savings plan for working Singaporeans and permanent residents. It helps pay for housing, healthcare, and retirement needs. Understanding how you can use CPF savings for property purchases is key to buying your dream home without financial stress.

Buying a property involves many costs, such as the down payment, monthly mortgage instalments, and legal fees. CPF savings can help cover these expenses. By using CPF savings, you can reduce the amount of cash needed upfront and manage your finances more effectively. This guide will explain the basics of using CPF for property purchases so you're well-prepared when the time comes to buy a home.

Let’s dive into how CPF savings can be used to buy a property, the limits for different property types, and common questions that people have about the process. This information will help you make informed decisions and maximise your CPF savings for housing purposes.

Understanding How CPF Savings Work for Property Purchases

The Central Provident Fund (CPF) is an important scheme that helps Singaporeans and permanent residents save for their future needs. One key feature of CPF is that it can be used to buy a property. Understanding how CPF savings work for property purchases is essential for making informed decisions.

Your CPF savings are divided into three accounts: Ordinary Account (OA), Special Account (SA), and Medisave Account (MA). For property purchases, the funds from your OA are primarily used. You can use your OA savings for the down payment, monthly mortgage instalments, and other property-related expenses.

When you decide to use your CPF savings to buy a home, you must first check the balance in your OA. The funds in this account can help cover the initial costs, reducing the amount of cash needed immediately. Additionally, if you have sufficient savings, you can use your OA funds to make monthly mortgage payments, easing the financial burden over time.

Another advantage of using CPF savings is the flexibility it provides. You can use your CPF savings for both new and resale properties. However, keep in mind that there are limits and guidelines to ensure that your retirement savings are not overly depleted. It's important to understand these rules to make the most of your CPF savings for your property purchase.

Step-by-Step Guide to Using CPF for Property Payments

Using CPF savings for buying a property involves several steps. Here’s a simple guide to help you navigate the process smoothly.

1. Check Your CPF Balance: Before making any decisions, log in to your CPF account to check the balance in your OA. This will give you an idea of how much you can use for your property purchase.

2. Obtain a Housing Withdrawal Statement: If you’re planning to use CPF savings, you need a statement showing the amount you can withdraw. This helps you plan your finances better.

3. Apply for a Bank Loan or HDB Loan: Depending on whether you’re buying a private property or a HDB flat, you’ll need to apply for the respective loan. The loan amount, combined with your CPF savings, will determine your total budget.

4. Inform CPF of Your Property Purchase: Once you’ve decided to proceed, you must inform CPF. This is usually done through your lawyer or the HDB office. They will handle the paperwork and ensure the funds are transferred correctly.

5. Use CPF for Down Payment and Legal Fees: Your CPF savings can be used to pay for the down payment and legal fees. This reduces your need for immediate cash, making the buying process smoother.

6. Set Up Monthly Mortgage Payments: Decide how to split your monthly payments between your CPF savings and cash. Many people choose to pay their entire monthly mortgage from their CPF OA balance.

Following these steps ensures that you use your CPF savings effectively, reducing financial strain and helping you secure your property in a well-planned manner.

Limits on CPF Usage for Different Types of Properties

While CPF savings are a valuable resource for property purchases, it's important to be aware of the limits imposed on their use. These limits vary depending on the type of property you are buying.

For Housing and Development Board (HDB) flats, you can use your CPF savings to cover up to 100% of the Valuation Limit (VL). The VL is the lower of the purchase price or the market valuation of the property. After your CPF savings reach this limit, you must pay at least 50% of the remaining property payments in cash, and the remainder can still be covered by CPF.

For private residential properties, you can also use your CPF savings up to 100% of the Valuation Limit. However, if you wish to continue using CPF savings beyond the VL, you must ensure that half of the property’s remaining value is paid in cash. This ensures that your CPF savings are not completely exhausted, helping you maintain funds for future needs.

If you have existing property loans, be mindful of the rules on concurrent financing. You can use your CPF savings to finance multiple properties, but the amount you can use for a second property is subject to stricter limits. It’s crucial to understand these guidelines and make informed decisions.

Common Questions About Using CPF Savings for Housing

Many people have questions about using their CPF savings for property purchases. Here are some of the most common questions:

- Can I use my CPF savings for the initial down payment? Yes, you can use your CPF OA savings to pay for the down payment. This helps reduce the amount of cash required upfront.

- What if I don't have enough CPF savings for my property purchase? In this case, you may need to supplement with more cash or take a larger loan. It’s important to budget accurately to avoid financial strain.

- How do I use my CPF savings if I am buying a property with another person? If you are buying a property jointly, both parties can use their CPF OA savings. This can help increase the available funds for the purchase.

- What happens to my CPF savings if I sell my property? When you sell your property, you need to refund the amount used from your CPF OA, including the accrued interest, back into your CPF account. This ensures that your retirement savings are replenished.

- Can I use my CPF savings to buy a property overseas? No, CPF savings can only be used for properties located in Singapore.

Understanding the answers to these questions helps ensure that you use your CPF savings wisely and within the guidelines set by the CPF Board.


Using CPF savings to buy a property in Singapore is a practical way to manage your finances and make homeownership more achievable. By understanding the fundamentals, following the step-by-step process, and being aware of the limits, you can maximise the benefits of your CPF savings while securing a new home.

Planning effectively reduces financial strain and ensures you have sufficient savings for future needs. Our goal is for every homebuyer to have the information necessary to make sound decisions regarding their CPF savings and property purchases.

For any further enquiries or professional assistance with your property needs, contact us at PropZen Consultant, your best real estate agent in Singapore. Our team is here to guide you through the process, ensuring a smooth and successful property purchase.