ABSD for Second Property Financing: Your Complete FAQ Guide
When you're ready to purchase your second residential property in Singapore, the Additional Buyer's Stamp Duty (ABSD) becomes a critical financial consideration that directly impacts your financing needs and total purchase costs. For Singapore Citizens buying a second property, ABSD is set at 20% of the purchase price or market value (whichever is higher), effective from 27 April 2023 and unchanged in 2026.[1][2] This means on a S$1 million property, you'll pay an additional S$200,000 in stamp duty alone—a significant amount that reshapes your financing strategy and borrowing requirements.
At Homejourney, we prioritize your safety and financial confidence by providing transparent, verified information to help you understand exactly how ABSD affects your second property purchase. This guide addresses the most common questions we hear from upgraders and investors, ensuring you can make informed decisions about your additional property financing.
Understanding ABSD: The Basics for Second Property Buyers
ABSD is a stamp duty imposed on property purchases based on your buyer profile and the number of properties you already own. Unlike Buyer's Stamp Duty (BSD), which applies to all property purchases, ABSD is specifically designed to moderate property market demand and prioritize first-time buyers.[3]
The key distinction for second property buyers is that ABSD is calculated on the higher of the purchase price or market valuation of the property.[1] This means if your property's market value exceeds the purchase price (common in hot markets), you'll pay ABSD on the higher valuation—an important detail that can significantly increase your total costs.
For second property financing, understanding your exact ABSD liability is essential before you commit to a purchase. This determines how much additional capital you need to raise through your mortgage, CPF, or savings.
ABSD Rates for Different Buyer Profiles in 2026
Singapore's ABSD structure varies significantly based on your citizenship status and how many properties you already own:[1][3]
- Singapore Citizens (SC) buying a second residential property: 20% ABSD
- Singapore Citizens buying third and subsequent properties: 30% ABSD
- Singapore Permanent Residents (SPR) buying a first property: 5% ABSD
- Singapore Permanent Residents buying a second property: 30% ABSD
- Singapore Permanent Residents buying third and subsequent properties: 35% ABSD
- Foreigners buying any residential property: 60% ABSD
- Entities and Trusts buying any residential property: 65% ABSD
If you're purchasing jointly with a spouse or partner, the ABSD rate applied is based on the buyer profile with the higher rate. For example, if a Singapore Citizen (SC) and Singapore Permanent Resident (SPR) purchase a second property together, the 30% SPR rate applies to the entire purchase.
How ABSD Impacts Your Financing Needs
ABSD significantly increases the total capital required for your second property purchase, which directly affects your mortgage amount and financing strategy. Let's work through a practical example:
Example: S$1 million second property purchase (Singapore Citizen)
- Purchase price: S$1,000,000
- ABSD at 20%: S$200,000
- Buyer's Stamp Duty (BSD): Approximately S$17,100
- Legal and conveyancing fees: S$2,000–S$3,000
- Total upfront costs: ~S$219,000–S$220,000
This means you need to have S$220,000 in liquid capital available at completion—money that cannot be financed through your mortgage. Most banks will only lend up to 75% of the property value for second properties (compared to 80% for first properties), further reducing your borrowing power.[2]
At Homejourney, you can calculate your exact mortgage eligibility instantly using our built-in calculator on the Bank Rates page. This helps you understand precisely how much you can borrow and how much you need to save for ABSD and other upfront costs.
ABSD and Your Mortgage: Key Financing Considerations
When applying for a mortgage on your second property, lenders evaluate several factors affected by ABSD:
Loan-to-Value (LTV) Ratio
Banks typically offer 75% LTV for second properties, meaning you must provide a 25% down payment. With ABSD added to your down payment requirement, your total cash outlay increases significantly. On a S$1 million property, you'd need S$250,000 (25% down payment) plus S$200,000 (ABSD) = S$450,000 in cash.
Total Debt Servicing Ratio (TDSR)
Your TDSR is capped at 60% of your gross monthly income, and this includes all your existing loans (car loans, credit cards, personal loans) plus your new mortgage. ABSD doesn't directly count toward TDSR, but it reduces the capital you have available for down payment, potentially forcing you to borrow more and increasing your monthly mortgage obligations.
CPF Usage for Second Properties
You can use your CPF to pay for ABSD on your second property, which is a significant advantage. However, you must have sufficient CPF savings in your Ordinary Account (OA) and Special Account (SA). Many upgraders use CPF for both the down payment and ABSD, preserving their cash reserves for other needs.
Strategies to Manage ABSD Costs
Timing Your Property Sale
If you're upgrading from an HDB to a private property, the timing of your HDB sale matters significantly. If you have contracted to sell your first property before you sign the Acceptance to the Option to Purchase for your second property, you may not need to pay ABSD on the second purchase.[1] This can save you tens of thousands of dollars. Work closely with your lawyer to understand the exact timing requirements.
Maximizing CPF Usage
Using your CPF for ABSD payment preserves your cash for other closing costs and provides flexibility. However, remember that CPF withdrawals reduce your retirement savings. Calculate the long-term impact before deciding.
Comparing Bank Financing Options
Different banks offer varying interest rates, tenure options, and loan structures. A difference of just 0.1% in interest rate can save you tens of thousands over a 25-year mortgage. At Homejourney, you can compare current rates from DBS, OCBC, UOB, HSBC, Standard Chartered, Maybank, and other major banks in one place. Our Bank Rates page shows real-time rates so you can identify the best financing option for your situation.
Refinancing Opportunities
After purchasing your second property, you may have opportunities to refinance if interest rates drop or your financial situation improves. Homejourney's refinancing guide makes this process straightforward by allowing you to compare offers from multiple banks with a single application.
ABSD FAQs: Answers to Your Most Common Questions
1. Can I avoid paying ABSD on my second property?
In most cases, no—if you own one residential property and purchase another, you must pay ABSD at 20% (as a Singapore Citizen). However, there is one important exception: if you have contracted to sell your first property before you execute the Acceptance to the Option to Purchase for your second property, you may not need to pay ABSD.[1] This is why timing is critical for upgraders. Consult your lawyer immediately to understand the exact documentation and timing required.
2. Is ABSD calculated on the purchase price or market value?
ABSD is calculated on the higher of the purchase price or the market valuation of the property.[1][3] If you negotiate a good deal and purchase below market value, you pay ABSD on the market value—not your actual purchase price. This is an important distinction that can increase your costs unexpectedly.
3. Can I use my CPF to pay ABSD on my second property?
Yes, you can use your CPF Ordinary Account (OA) to pay ABSD on your second property, which is a major advantage for upgraders. However, you must have sufficient CPF savings available. Many upgraders strategically use CPF for both their down payment and ABSD, preserving cash for other expenses. Check your CPF balance and projected retirement needs before making this decision.
4. How much can I borrow for my second property given ABSD costs?
Banks typically lend up to 75% of the property value for second properties (compared to 80% for first properties). With ABSD added to your down payment requirement, your total cash outlay increases significantly. Use Homejourney's mortgage calculator on our Bank Rates page to calculate your exact borrowing power based on your income, existing debts, and CPF savings. This gives you a clear picture of what you can afford.
5. Do I pay both BSD and ABSD on my second property?
Yes, you pay both Buyer's Stamp Duty (BSD) and ABSD on your second property.[3] BSD is the standard stamp duty applied to all property purchases, while ABSD is an additional tax for non-first-time buyers. On a S$1 million second property purchase, you'd pay approximately S$17,100 in BSD plus S$200,000 in ABSD, totaling over S$217,000 in stamp duties alone.
Next Steps: Get Your Financing in Order
Understanding ABSD is the first step toward a successful second property purchase. The next step is to calculate your exact financing needs and compare mortgage options from Singapore's major banks.
At Homejourney, we've made this process simple and transparent. Our Bank Rates page allows you to:
- Calculate your mortgage eligibility instantly based on your income, existing debts, and CPF savings
- Compare current interest rates from DBS, OCBC, UOB, HSBC, Standard Chartered, Maybank, and other major banks
- Submit one application to multiple banks and receive competing offers in days, not weeks
- Use Singpass/MyInfo integration to auto-fill your application in seconds—your income, employment, and CPF data are verified instantly
- Connect with Homejourney Mortgage Brokers who provide personalized guidance throughout the application process
For a comprehensive overview of second property financing, see our detailed guide on ABSD Second Property Guide: Financing Impact 2026 ABSD Second Property Guide: Financing Impact 2026 | Homejourney , which covers upgrading strategies, HDB vs private property considerations, and long-term investment planning.
Ready to find your second property? Start by searching properties within your budget on Homejourney's Property Search page, then use our financing tools to confirm affordability before you make an offer.
Homejourney's commitment to your safety and trust means we verify all information, provide transparent guidance, and prioritize your financial confidence at every step of your property journey.
