How to Buy a Condo Without Overstretching Your Monthly Budget

Buying a condo is a major financial step—and often one of the largest purchases you’ll make. While the idea of owning private property in Singapore is appealing, it’s also easy to overcommit financially, especially with rising interest rates, maintenance costs, and lifestyle expenses.

The good news? With the right planning, it’s possible to buy a condo without stretching your monthly budget too thin. Whether you’re a first-time buyer or upgrading from an HDB flat, here’s how to make a smart, sustainable purchase.

1. Know Your True Affordability—Not Just What Banks Allow

Banks may approve a loan that takes up to 55% of your gross monthly income under the Total Debt Servicing Ratio (TDSR). But just because you qualify doesn’t mean you should borrow to the limit.

A safer guideline:

Keep all housing-related expenses (mortgage, condo maintenance fees, property tax) below 30–35% of your monthly income
Factor in potential interest rate hikes—use a buffer rate of 4–4.5% for your mortgage calculations

Being conservative protects you against income fluctuations, job changes, or rising expenses in the future.

2. Choose the Right Unit Type and Size

Bigger isn’t always better. While a 3-bedroom unit may sound ideal, it also comes with a higher price tag, higher monthly repayments, and higher maintenance fees.

Consider:

2-bedroom or compact 3-bedroom units if you're a young couple or small family
Dual-key layouts if you plan to rent out part of your unit for income
Avoiding premium stacks with unblocked views or top-floor units unless they align with long-term value

Start with what you need, not what you think you should own.

3. Optimise Your Loan Tenure Wisely

While longer loan tenures (up to 30 years for private property) reduce your monthly repayment, they also increase your total interest paid over time.

What to consider:

Take a longer tenure initially to lower your monthly burden, especially if you're early in your career
Make partial repayments when you receive bonuses or salary increments
Refinance after a few years for better rates, if market conditions improve

Flexibility is key—avoid locking yourself into an inflexible financial situation just to secure a shorter loan.

4. Watch Out for Hidden Monthly Costs

Beyond the mortgage, condo owners face other monthly or quarterly expenses:

MCST fees: Ranging from $250–$500 per month, depending on the project
Property tax: Based on Annual Value (AV), which is higher for private property
Utilities, insurance, and home maintenance

When budgeting, always add 10–15% buffer above your estimated monthly housing cost to stay safe.

5. Plan Your Downpayment Strategically

You’ll need to pay 25% downpayment, with at least 5% in cash. The more you can afford to pay upfront, the less you borrow—and the lower your monthly repayment.

Tips:

Use CPF Ordinary Account balances wisely but leave enough for future needs
Avoid draining your entire savings for the downpayment—maintain an emergency fund of 6 months' expenses
Explore whether bridging loans are needed if upgrading from HDB to condo

Don’t fall into the trap of being asset-rich but cash-poor.

6. Consider Projects with Lower Maintenance Fees

Some condos come with luxury facilities (sky gardens, concierge, wine cellars), but also carry higher monthly MCST fees. Unless you’ll use these amenities often, it may be better to opt for projects with practical features and lower upkeep.

This reduces your long-term carrying cost and keeps your monthly budget more manageable.

7. Reassess Lifestyle Spending Before Buying

Upgrading to a condo often means adjusting your monthly lifestyle—especially in the early years.

Take a look at:

Dining, travel, and shopping habits
Subscription services and discretionary spending
Upcoming family costs (children, insurance, parents’ support)

Being honest about your monthly cash flow helps you avoid painful sacrifices after the purchase.

Conclusion: Stretching Within Your Means, Not Beyond

Buying a condo in Singapore doesn’t have to mean financial stress. With smart choices around unit size, financing structure, and monthly planning, you can own a private home without compromising your long-term stability.

The goal is simple: Buy a condo you can comfortably afford now and in the future, not one that impresses others but leaves your bank account under pressure. When your property supports your lifestyle—not the other way around—you’ve made the right move.