Introduction
Property inheritance is a sombre topic, it usually comes after the unfortunate demise of a loved one. We decided to write about this topic, after several readers whatsapp us with questions on how to manage and optimise the sentimental asset that was passed on to them via inheritance.
We like this article to serve as a tool to equip ourselves with the correct head knowledge to be a good and wise steward of the asset left to us, providing clarity on next steps.
Quick Introduction – Decoupling Expertise
We are a team of realtors that thrive in complex real estate situations. We pride ourselves in helping our client navigate and derive the best strategies to own their 2nd and 3rd properties in Singapore.
Topics that fall within our niche, comprise the following.
- Decoupling property to minimise ABSD on second property
- Structuring HDB ownership for future ownership of second property
- Property portfolio optimisation for owners planning for retirement
- Property inheritance and next steps consideration
- Alternative property investment – industrial and commercial property investing
- Property consideration in view of divorce
- Reverse equity loan to unlock equity from current asset
Scenario 1 – Can I inherit Private Property if I own a HDB ?
Yes, you can inherit the private property while owning a HDB and the following options are available to you.
But note, for each option specific HDB rules are applicable, so please review to assess if you are eligible to consider each of these options.
- Keep private property and keep HDB
- Sell private property and keep HDB
- keep private property and sell HDB
#1 – Keep private property and Keep HDB
Rules
- Can only Keep private property if you have fulfilled the MOP period for your current HDB
- if you have not fulfilled your MOP, you will be required to sell the inherited private property within 6 months from inheritance
Considerations
Do you need to pay ABSD on inherited property
No ABSD will be levied on the inherited property.
Do you need to pay ABSD on future property purchase
You now own 2 properties in the eyes of IRAS. The next property purchase will be considered a 3rd property. You will be levied 30% and 35%, respectively for citizens and PR.
Existing Mortgage
Consider the situation whereby the property has an existing mortgage and if deceased have not purchased a term insurance or a mortgage insurance that will pay off the mortgage. You will be required to take over the existing mortgage for the inherited property.
You will need to work with the banker that represents the bank for the existing mortgage, tied to the inherited property, to assess your income and financial circumstances to determine if you are able to take over the mortgage.
Even if the bank ascertains that you are eligible to take over the mortgage, you should also consider if you have created enough buffer in terms of monthly cash flow, factoring the need to account for additional mortgage for the inherited property.
As a rule of thumb, your monthly recurring expense should not surpass 40% of your gross monthly income.
Consider refinancing the mortgage
The mortgage undertaken by the deceased previously could be on a higher interest rate package. This will result in higher monthly instalments.
Repricing the loan with the same bank or refinancing the loan with another bank, gives you the option of signing up for a lower interest rate package. This will help reduce monthly mortgage payment, reducing the burden of supporting two properties.
If you can’t or don’t have the ability to take over the mortgage
You will have to consider selling the property. You will need to write to the bank and negotiate for a deferment or reduction in monthly instalment. This will help buy some time for you to sell the property at a reasonable price.
Existing Tenancy
If the inherited property is tenanted out. You will inherit the existing tenancy contract and be obligated to serve out its obligation.
To deal with the issue of taking over the tenancy for the inherited property, you have got the following option.
If rental rates are below market rate
Check the current tenancy contract for termination clause and what is the compensation that you will have to make to the current tenant.
if rental rates is reasonable
You can safely take over the property with tenancy and enjoy its passive rental income.
Is the private property worth keeping ?
The idea of owning both a HDB and a private property may sound appealing. But an important point to consider is if it is worth holding on to the inherited private property, or if it is better to sell it.
As a side note, selling the inherited private property, reaping its profit, and selling your current HDB. Opens up the possibility of consolidating two properties into a higher value and bigger private property for your home stay and investment purposes.
First, let’s consider if the private property is worth keeping.
How old is the inherited private property ?
If the property is approaching its 30 to 35 years lease life. It would be facing the challenges of lease decay.
Future buyers will be facing limitations in taking a bank loan for the property. As banks generally lower the loan to valuation ratio below 75% for property less than 75 years in lease life. If lease falls below 30 years of age, no bank will be willing to finance the property, your future buyer will have to fund the property in full cash,
Similarly, for property with tenure not being able to cover the youngest borrower age till 95 years of age, there will be a limit imposed on CPF withdrawal to fund the purchase of the property.
Does the property possess strong investment fundamentals ?
Consider if the property possesses strong investment attributes that can bring about greater price appreciation in the future.
For greater insights on this refer to the article “Which condo is good for investment in Singapore ?”
#2 – Sell the private property and Keep HDB
This is a natural option that you will have to take if you have not completed your minimum occupancy period for your current HDB.
Rules
- If your HDB has not fulfilled its minimum occupancy period, you are not allowed to keep the private property.
- You will have to sell it within 6 months from the date of inheriting it.
Considerations
You will then need to take the following into consideration
Seller Stamp Duty
Seller stamp duty is applicable to the sale of inherited private property, depending on the date the deceased entered a contract to purchase the property.
Current exemption for seller stamp duty is only applicable to the sale of HDB flats due to instances related to inheritance.
If the deceased have held the private property for more than 4 years then seller stamp duty is waived. If deceased ownership duration is shorter than 4 years, then the following SSD tax rate is applicable.
Revised Seller’s Stamp Duty (SSD) rates effective from 4 July 2025:
- Sold within 1 year: 16%
- Sold within 2 years: 12%
- Sold within 3 years: 8%
- Sold within 4 years: 4%
- Sold after 4 years: No SSD payable
#3 – Keep the private property and sell HDB
Another option worth considering would be to upgrade from your current HDB and move into the inherited private property, and selling off your current HDB.
Similarly, this option is only possible if the following rule has been fulfilled.
Rules
- You will only be able to sell your HDB if it has fulfilled its 5 year minimum occupancy period.
Consideration
Loan financing
Given the inherited private property is willed to your name and you do not intend to include your spouse name into property ownership.
Being the sole owner of the property, you will not be able to include your spouse’s name and income as part of the mortgage consideration for the inherited private property.
Your maximum eligible loan quantum will be assessed solely based on your gross monthly income, and only your CPF can be used to finance the monthly mortgage payment.
Private property ownership
Given that you are now a private property owner. There will be future limitations towards future purchase of HDB flats.
If you ever sell the inherited private property and consider moving back to a HDB flat. You will have to serve out a 15 months wait out period to be re-eligible for purchase of resale HDB flat and a 30 months wait out period for BTO and new ECs.
However, you will be exempted from this, if you are 55 years old and above and is looking to purchase a 4 room or smaller HDB resale flat.
Scenario 2 – Can I inherit HDB if I own a Private Property ?
Yes, you can inherit the HDB if you currently own the private property.
The Options available to you will be as follows.
- Keep inherited HDB and keep existing private property
- Sell inherited HDB and keep existing private property
- Keep inherited HDB and sell existing private property
#1 – Keep inherited HDB and keep existing private property
On the surface, this seems like the ideal option for many private property owners, being able to inherit a HDB while retaining your current private property. But due to HDB rules, this option would require you to make some compromise on your current living condition.
Rules
- You and your family must live in the flat.
- You must be a Singapore citizen.
- You must meet the usual eligibility criteria of owning a HDB flat. i.e. Own it as a family nucleus or must be above 35 if you are a Single.
- You must continue to fulfil the flats remaining MOP, if its MOP has not been fulfilled by the deceased.
Consideration
Existing Mortgage
Existing mortgage should not be a major concern for inherited HDB. As it is mandatory for HDB home owners to sign up for a Home Protection Scheme (HPS), in order to finance the monthly mortgage using CPF.
The home protection scheme will help pay off outstanding mortgage, when the original flat owner passes away.
Do you need to pay ABSD ? – No ABSD to be levied on the inherited HDB
In the case of direct inheritance, both buyer stamp duty (BSD) and additional buyer stamp duty (ABSD) will not be applicable.
But the following condition must be met
- The inherited property is a residential home
- The inheritance is made in the form of a grant of probate, grant of letters of administration or the administration of Muslim Law Act. Essentially this meant all inheritance that is administered with a will or without a will.
ABSD is applicable on future property purchase
Here’s the catch, no ABSD is levied when you inherit a property. But the inherited property will now be added to your property count.
If you were to ever sell your existing private property, with plans of upgrading to another private property. ABSD is applicable to your next private property purchase, you will be deemed a 2nd property buyer and will be taxed with a 20% ABSD.
Potentially this can land you in a deadlock situation, whereby you are forced to hold on to the current private property and inherited HDB. Any shift in asset will result in ABSD kicking in.
Refer to the section after this, for a sample solution that could potentially resolve this issue. Note, given the construct of the solution in complex and hinges on HDB regulations, feasibility is subjected to HDB prevailing regulation at the point of implementation.
Freeing up 1 spouse name to purchase a 3rd property down the road.
First up a quick legal disclaimer on this point. Please do not take this as legal advice.
For official legal advice drop us a text, we will be happy to refer you to a qualified lawyer to review considerations specific to your case.
This consideration is applicable to more ambitious investors / property owners that are looking to purchase another investment property on top of their current private property and inherited HDB.
It comprises three steps.
- Structure the ownership of the inherited HDB using a HDB owner occupier scheme.
- After fulfilling the necessary MOP under the HDB owner occupier scheme, look to decouple your private property to free up the same HDB occupier’s name from the original private property.
- Purchase the next investment property under the spouse name that has been free up from both the inherited HDB and original private property.
*Note, the feasibility of this approach is subject to changes in HDB regulations.
As a side note, if you are interested in understanding the pros and cons of upgrading from HDB to Condo, check out article inline.
#2 – Sell inherited HDB and keep existing private property
This is an option that is often preferred by private property owners, inheriting a HDB flat. It will entail the sale of the inherited HDB flat, managing the tight sale timeline to optimise for ideal selling price.
Rules
- You will need to sell the HDB within 6 months of inheritance, if you do not have any plans of living in it and retaining its ownership
Consideration
Short 6 month timeline to sell inherited HDB
Working within 6 months to sell the inherited HDB at a decent price could be a challenge, especially if the HDB requires some minor renovation work to spruce it up for sale. You can write to HDB to appeal for an extension in the sale period, expressing the difficulty you face in selling the property at a reasonable price.
Cash proceeds from sale of inherited HDB
With empathy and consideration for the unfortunate demise of a family member.
A point considered down the road, assuming the successful sale of the inherited HDB, is how you can potentially utilise the cash proceeds from sale to restructure your current property portfolio.
With additional cash on hand you could consider the following options
Decoupling private property
You can consider decoupling the current property property, freeing up one spouse name, coupled with the cash proceeds from inheritance to purchase a 2nd investment property.
For more information on the technicality and cost of decoupling refer to article link inline.
Need help taking the next steps for decoupling ? Drop us a text to clarify your concerns.
Sell the current private property and purchase 2 private property
Next, if budget permits, you can consider the sale of the current property, coupled with the cash proceeds from inheritance to purchase 2 private properties.
Other permutations for real estate portfolio as follows
Other options to consider include buying a dual key condo and Investing in an industrial property.
#3 – Keep inherited HDB and sell existing private property
This may not seem like the most intuitive option, downgrading from a private property back to an inherited HDB. But we have come across unique circumstances that make this option appealing.
Consider the case, where you and your spouse are currently living in a 2 bedroom condo and you recently had kids and the opportunity of inheriting a larger sized 4 bedroom HDB arises.
The option of selling the existing private condo and moving into the HDB flat would be an option worth considering.
Rules
- If the inherited HDB flat have not pass its minimum occupancy period, the beneficiary can only keep the inherited property if he or she have sold his private property at least 15 months ago
- This essentially seals off the loophole of a private property owner being able to bypass the 15 months wait out period to downgrade to a HDB after selling a private property.
Consideration
Seller stamp duty applicable on your private property
A point to note is that seller stamp duty is still applicable on your private property. If you sold your property without holding on to your property for more than 4 years, seller stamp duty will be levied accordingly.
Revised Seller’s Stamp Duty (SSD) rates effective from 4 July 2025:
- Sold within 1 year: 16%
- Sold within 2 years: 12%
- Sold within 3 years: 8%
- Sold within 4 years: 4%
- Sold after 4 years: No SSD payable
No ABSD to be levied on the inherited HDB
Similarly no ABSD or buyer stamp duty is applicable, with the following condition met.
- The inherited property is a residential home
- The inheritance is made way of a grant of probate, grant of letters of administration or the administration of Muslim Law Act. Essentially this meant all inheritance that is administered with a will or without a will.
Scenario 3 – Can I inherit HDB if I own a HDB Flat ?
Considering the situation where by you currently own a HDB flat and inherit another HDB flat
Unfortunately, you will not be able to hold on to the HDB flat that you inherited. You will have to sell it away on the open market within 6 months of inheritance.
Refer to the rules section below for details.
Rules
- According to HDB regulation, a single family nucleus is not allowed to own 2 HDB flats at a single point in time.
- You would have to sell the inherited HDB flat within 6 months from inheritance
Consideration
Short 6 month timeline to sell inherited HDB
Similar to the point above you will be working with a short time to sell the inherited HDB flat
To address this, you can write to HDB to appeal for an extension in sale period, expressing the difficulty you face in selling the property at a reasonable price.
Which HDB flat to keep ?
One potential consideration that could arise is which HDB flat to keep. Consider the situation whereby, the inherited HDB flat is a larger HDB flat in a better location than your current HDB flat.
To assist you in your consideration, use the following factor to review which HDB to keep.
- Remaining lease life of each HDB flat
- Location of each HDB flat
- Potential resale value of each HDB flat
No ABSD to be levied on the inherited HDB
Applicable for all residential property inheritance, buyer stamp duty and additional buyer stamp duty will not be applicable.
Scenario 4 – Can I inherit Private Property if I currently own a Private Property ?
Yes, you can inherit a private property if you currently own another private property, and no ABSD and buyer stamp duty will be levied on the inherited property.
As simple as it may sound, there are specific considerations and implications to take note of, refer to section below for more details.
Options on what you do with the property after inheriting it.
- Keep private property and keep existing private property
- Sell inherited private property and keep your current private property
- keep inherited private property and sell your current private property
Rules
- No specific rules pertaining to Singaporean citizens currently owning a private property, inheriting another private property.
- For Singapore PR, you are free to inherit a private condo. But if the inherited property is a landed property, you would have to write to Singapore Land Authority to apply for approval to keep the property.
- Similarly for foreigner, if you were to inherit a landed property, you will need to write in to SLA for approval.
#1 – Keep private property and keep existing private property
In this scenario, you seek to optimise your property portfolio by keeping both your current private property and the inherited private property.
Considerations
The benefit of property inheritance is that there is no ABSD and buyer stamp duty to be levied on your inherited property.
No ABSD on the inherited property, but ABSD is applicable on your future property purchase.
But the challenge arises, down the road, as you are trying to rejig your property portfolio.
Assuming you were to keep the inherited private property, but look to sell your current private property and look to repurchase another one.
Given that the inherited property is counted towards your property ownership, your next private property purchase will be deemed a second property purchase. You will be levied a 20% ABSD as a Singapore citizen and a 30% ABSD as a Singapore PR.
Potential Property Deadlock
Elaborating on the consideration above, you could potentially be facing a deadlock in your property portfolio. This happens as you seek to keep your inherited property and is unable to make any upgrade to your current private property
Sole ownership of inherited property and decoupling as solution
The solution to the issue above would be as follows.
- Inherit property under sole ownership, using only the name of the person in the will. You do not need to involve your spouse name, unlike HDB, you do not need a family nucleus to own a private property.
- Decouple your existing private property, free your spouse name from the current private property that is jointly owned.
- Use your spouse name to purchase the next private property or to purchase a 3rd property to add to the current 2 property portfolio.
For more insights on the procedure for decoupling, check out the article link inline.
#2 – Sell inherited private property and keep your current private property
Taking this option entails you unlocking the value in the inherited property by selling it. Interesting consideration revolves around how you can use the proceeds from sale to restructure your existing property portfolio.
Considerations
Seller Stamp Duty is applicable
Getting this off the list, in case the inherited property has not been held for more than 4 years, seller stamp duty will be levied upon its sale. Rates will be 16% within the first year of ownership, 12% within 2 years, 8% within 3 years and 4% between 3rd and 4th year.
Exemption for seller stamp duty for inherited properties is only applicable for sale of HDB flats.
Portfolio restructuring
This happens to several of our readers, receiving a lump sum proceeds from the sale of an inherited property, opening up the consideration of what to do with the sale proceeds of the inherited property.
The following progression and restructuring to your current portfolio can be considered.
- Upgrade to a landed property – Sell current private property, together with cash proceeds from inherited property, purchase a larger landed property.
- Upgrade to a newer and larger private condo – Sell the current private property and purchase a newer and larger private condo with greater capital appreciation potential.
- Purchase a 2nd new launch condo – Keep current private property for homestay, decouple and purchase a second new launch condo.
Looking for ideas on how you can optimise your property portfolio ?
Drop us a whatsapp text for 2nd opinion. We will take your goals, age, existing asset into consideration and explore possibilities together with you.
#3 – Keep inherited private property and sell your current private property
Stating this point for the sake of completeness. The considerations are similar to the option above, so feel free to reference the section above if you are considering this option.
Consideration
Which private property to sell or keep ?
One potential dilemma you could experience is which property to keep or sell. Putting sentimental considerations aside, the following are factors that you use to evaluate your options.
Investment attribute of inherited private property vs current private property
- Which property would have a higher demand from HDB upgraders
- Which property has 1km proximity to a reputable primary school
- Which property has a newer lease life
- Reconsider keeping the property if it belongs to a niche development with less than 300 units
Which property is situated in a sought after neighbourhood
- Lifestyle attribute of inherited property vs current property property
- Which property offers a larger space that can cater to your family needs
- Which property is closer to your place of work and child school
- Which property offers you a environment that you prefer living in
Scenario 5 – Can I inherit a HDB, if I currently own an EC ?
You will only be able to inherit a HDB and keep your current EC if you are a Singaporean citizen. Applicable rules as follow.
Rules
- You must be a Singapore citizen to hold on to an inherited HDB and EC at the same time.
- Your EC must have fulfilled its 5 year minimum occupation period if you were to retain the inherited HDB.
- If your EC has not passed its 5 year MOP, you will have to sell the HDB within 6 months from inheritance.
Scenario 6 – Can I inherit a private property, if I currently own an EC ?
What happens if you were to inherit a private property if you currently own a EC, will you be able to keep both properties ? The short answer is yes, you will be able to keep both the private property and the EC, if your EC has fulfilled its 5 year MOP holding period.
Rules
- You will be able to hold on to your private property and your EC, if your EC has fulfilled its 5 year MOP.
- If you currently own a resale EC and both you and your spouse are PRs, you will still be able to keep the inherited private property and EC.
- There is no requirement for you to be a Singapore citizen in order to own a private condo.
- If inherited property is a landed property, assuming either you or your spouse is a PR or foreigner, you will have to apply to Singapore Land Authority for approval.
Scenario 7 – Partial inheritance, inheriting percentage share of a property
This section deals with partial inheritance, instead of inheriting a property in its entirety, inheriting on percentage or part share of a property,
Rules
Key thing to note is that partial inheritance of a property counts towards your overall property count. So even if you inherited a 5% property share in a property, you are deemed to own 1 property.
You will need to pay ABSD on your future property purchase
This will present a problem when you are looking to sell your current homestay property and purchase another property. The next property purchase, coupled with your 5% ownership in the ownership is deemed as a 2nd property purchase.
This will result in you being levied with a 20% 2nd property ABSD if you are a Singapore citizen or 30% ABSD if you are a Singapore PR.
Consideration
Part sale of shares to relative
As a consideration, barring any potential relational complication that may arise. You can consider a part sale of your proportional share to a relative that is looking to consolidate share in the property.
This could potentially free you up from the complications that come with ABSD down the road. Vice versa, if you see potential in the property, you can also convince your relative to part sell their shares to you.
We have written a dedicated article on part purchase property in Singapore, refer to article link in line.
If you are thinking of avoiding transaction cost by simply transferring share as a gift consider the following article on 5 key disadvantages of transferring property as a gift.
Parting note – Property Inheritance in Singapore
We have come to the end of this article, if any of the information above have triggered you to consider taking the next steps on your plans.
Drop us a text to seek a 2nd opinion on your next steps.
Frequently asked questions – ABSD on Inherited Property
I have inherited a partial share in a HDB flat from my late grandparents. It is to be shared amongst 3 siblings. If I were to get another private property for my own stay after this. Do I have to pay ABSD on the purchase of the private property.
Yes, ABSD of 20% would have to be incurred on your next private property purchase. As the partial share in the inherited HDB is counted as 1 property ownership under your name.
Would I incur any seller stamp duty if I am looking to sell a inherited property ?
Note with reference to IRAS guideline on Seller Stamp Duties. If property is aquired via inheritance, the date of acqusition for the property is referred to the date in which deceased acquired the property, instead of the date in which property is inherited.
As a example. Assuming current year is 2025, property is inherited this year, in 2025, but deceased first purchased the property in 2020, five years ago. No seller stamp duty is to be levied if inherited property is to be sold in 2025.
On the contrary, if deceased purchase the property in 2024, one year ago, then a seller stamp duty will levied on the property as property is purchase 1 year ago, still within the 4 year seller stamp duty wait out period.
If property is inherited by 4 sliblings, distributed 25% share per slibiling, will there be any buyer stamp duty or additional buyer stamp duty incurred when shares is being transferred from one slibling to another slibling.
Yes, buyer stamp duty and additional buyer stamp duty will come into play as this is deem as a part sale and purchase transaction. Buyer stamp duty will be levied based on the market value of share to be transferred and additional buyer stamp duty will be levied based on the number of property slibling currently owned by slibling purchasing share.
