An Option to Purchase (OTP) is the contract in which a property seller offers to sell to a buyer at an agreed price, open for the buyer to accept, or exercise, within a set period. For an HDB resale flat it is on HDB’s prescribed form and runs 21 calendar days; the buyer pays an Option Fee of SGD 1 to SGD 1,000 when it is granted, and that fee plus the Option Exercise Fee cannot exceed SGD 5,000. Under the Housing Developers Rules a licensed developer’s option costs a booking fee of 5% to 10% of the price; for other private homes, CEA publishes an OTP template whose use is not mandated.
Singapore · the most an HDB resale buyer pays the sellers as Option Fee and Option Exercise Fee together (HDB)
SGD 5,000
Valid for21 days
Expires4pm
Paidcash, not CPF
Part ofthe price
Option FeeSGD 1–1,000HDB resale, paid when the OTP is granted
Both fees, at mostSGD 5,000Option Fee plus Option Exercise Fee
Option Period21 dayscalendar days, expiring at 4pm on the last day
Request for ValueSGD 120incl. GST, buyers using CPF or a housing loan
Developer booking fee5–10%of the price, Housing Developers Rules
Stamping, no penalty14 daysafter signing in Singapore (IRAS)
Key takeaways
- For an HDB resale flat, the OTP is a legally binding contract between the buyer and the sellers on HDB’s prescribed form; any other or supplementary agreement on the sale or purchase of the flat is not valid under the Housing and Development Act. To grant it, the sellers need a valid Intent to Sell registered on My Flat Dashboard and to have met the 7-day cooling-off period after registration. The buyer needs a valid HFE letter before entering into the OTP, and a buyer taking an HDB housing loan needs that letter to show HDB loan eligibility. Once they have granted it, the sellers cannot grant another OTP to other buyers until it expires.
- The buyer pays the sellers an Option Fee of SGD 1 to SGD 1,000, agreed between them, when the OTP is granted — the buyer does not sign the OTP at that stage — and an Option Exercise Fee on exercising it; the two together cannot exceed SGD 5,000. HDB says both amounts may be negotiated with the sellers and form part of the resale price, lists this deposit of SGD 2 to SGD 5,000 among the payments to be made in cash, and encourages digital payment modes to secure independent proof of payment.
- The Option Period is 21 calendar days, counting Saturdays, Sundays and public holidays, from the date the OTP is granted, and it expires at 4pm on the 21st calendar day; in HDB’s example, an OTP granted on 1 April expires at 4pm on 22 April. A buyer using CPF savings or a housing loan submits a Request for Value through My Flat Dashboard by the next working day after the Option Date, with page 1 of the OTP and a processing fee of SGD 120 including GST, and waits for the outcome before exercising; with a loan from a financial institution, the Letter of Offer must be issued on or before the day the OTP is exercised. To exercise, the buyer and all co-buyers sign the ACCEPTANCE section on page 8 and return the OTP to the sellers, and the buyer pays the Option Exercise Fee; the two sides then submit their portions of the resale application within the days agreed in the OTP and within 7 days of each other. If the buyer does not exercise it, the Option Fee is forfeited when the OTP expires.
- Under the Housing Developers Rules, a licensed housing developer grants an option when it accepts a booking fee of not less than 5% and not more than 10% of the price, and the option cannot be assigned or transferred. It is valid for 3 weeks from the day after the sale and purchase agreement and the title deeds (or copies) are delivered to the buyer or the buyer’s solicitors, unless the Controller of Housing permits a different period, and it lapses at once when the developer receives the buyer’s written notice, served before the validity period ends, that the buyer does not wish to exercise it. For an uncompleted private home, URA’s guide says the developer delivers those documents within 14 days of the option; exercising includes signing and returning the agreement and paying the balance down payment of 20% of the price less the booking fee, which the developer may allow within 8 weeks of the option date, and if the option is not exercised the developer may forfeit 25% of the booking fee and refund 75%. URA notes that a developer of a housing project with 4 or fewer units is not required to be licensed under the Housing Developers (Control & Licensing) Act, and may use its own sales contract.
- IRAS lists acceptance of an OTP, like a sale and purchase agreement, as an example of a purchase on which ad valorem stamp duty — BSD, ABSD and SSD, whichever applies — is payable; the first instrument executed in a sale bears the full duty and later documents for the same sale are not liable, and a document signed in Singapore can be stamped without penalty within 14 days after signing. For ABSD, the buyer’s profile is assessed at the date of purchase: the earliest of the date the Acceptance to the OTP is executed, the date of the sale and purchase agreement and other listed dates. For SSD on residential property, the holding period starts on the date the OTP is accepted, except for an OTP subject to signing a sale and purchase agreement, for which the agreement’s date applies instead. An OTP exercised on or after 4 July 2025 therefore falls under the revised schedule — 16%, 12%, 8% and 4% for a sale within the 1st, 2nd, 3rd and 4th year, and none after 4 years — even if it was granted earlier, with no transition period.
Definition
What is an Option to Purchase?
An OTP gives the buyer a set period to accept the seller’s offer at the agreed price. The form, the fee and the period depend on who is selling.
HDB resale flat21 daysHDB’s prescribed form. An Option Fee of SGD 1 to SGD 1,000 when it is granted; with the Option Exercise Fee, at most SGD 5,000.
Licensed developer5–10%A booking fee for the option under the Housing Developers Rules; valid 3 weeks from the day after the sale and purchase agreement and title deeds are delivered.
Other private homesnegotiatedCEA publishes a template whose use is not mandated; it stays open until a date the parties fill in, or two weeks.
IRAS lists acceptance of an OTP, like a sale and purchase agreement, as an example of a purchase on which stamp duty is payable; the first instrument executed in a sale bears the full duty.
Worked example
How the three kinds of OTP compare
How HDB, the Housing Developers Rules with URA’s guide, and the OTP template CEA publishes (developed by the Digitalised Property Transactions Workgroup, Version 1.2 of 10 February 2021) set out each stage. The developer column describes an uncompleted private home from a licensed housing developer; the last column shows the template’s terms, which the parties may change.
| HDB resale flat | Licensed developer | Other private homes (template) | |
|---|---|---|---|
| Form | HDB-prescribed OTP; any other or supplementary agreement on the sale is not valid under the Housing and Development Act | Standard OTP form; an amendment needs the Controller of Housing’s approval | Template published by CEA; its use is not mandated and its terms can be negotiated |
| Paid for the option | Option Fee, SGD 1 to SGD 1,000, agreed with the sellers | Booking fee, 5% to 10% of the price | Option Money; the template leaves the amount blank |
| Open for | 21 calendar days, expiring at 4pm on the 21st calendar day | 3 weeks from the day after the sale and purchase agreement and title deeds are delivered | Until a time and date the parties fill in, or two weeks |
| To exercise | The buyer and all co-buyers sign the ACCEPTANCE section and return the OTP, and the buyer pays the Option Exercise Fee (both fees together at most SGD 5,000); buyers using CPF or a loan wait for the Request for Value outcome first | Sign and return the sale and purchase agreement and pay 20% of the price less the booking fee | Sign the acceptance copy, deliver it to the vendor’s solicitors and pay a percentage of the price (left blank) less the Option Money |
| If not exercised | Option Fee forfeited when the OTP expires; the sellers keep it | Developer may forfeit 25% of the booking fee and refund 75% | Option Money forfeited to the vendor, save as provided in clause 4 of the Law Society of Singapore’s Conditions of Sale 2020 |
HDB resale fees on an example SGD 600,000 flat
Resale price, exampleSGD 600,000
Option Fee, at grantSGD 1,000
Exercise fee, at mostSGD 4,000
Both fees, at mostSGD 5,000
Money Snap’s illustration, with the Option Fee at the top of HDB’s SGD 1 to SGD 1,000 range. Because HDB caps the two fees together at SGD 5,000, an SGD 1,000 Option Fee leaves at most SGD 4,000 for the Option Exercise Fee. HDB says both fees form part of the resale price, so they count towards the SGD 600,000 rather than adding to it, and they are paid in cash rather than from CPF savings (HDB encourages digital payment for proof of payment); the SGD 120 Request for Value fee is paid to HDB.
What it means for you
Where the OTP shows up
The two feesHDB affordability calculator
For an HDB resale flat, the Option Fee (SGD 1 to SGD 1,000) is paid when the OTP is granted and the Option Exercise Fee when it is exercised; together they cannot exceed SGD 5,000. Both may be negotiated, form part of the resale price and are paid in cash rather than from CPF savings.Paying with CPF or a loanCPF housing withdrawal calculator
The buyer submits a Request for Value to HDB by the next working day after the Option Date, for SGD 120 including GST; the outcome is typically available within 10 working days, and the buyer waits for it before exercising. HDB bases its loan limit on the lower of the resale price and the value: 75% of that figure where the lease covers the youngest core member to age 95, pro-rated from 75% otherwise. It caps CPF use at the lower of the price and the value where the remaining lease is at least 20 years and covers the youngest buyer to age 95, and pro-rates it otherwise. So any part of the price above the value (cash over valuation) cannot be met from CPF savings or an HDB loan. Buyers paying wholly in cash do not need a Request for Value.Stamp dutyStamp duty calculator
IRAS lists acceptance of an OTP as an example of a purchase on which ad valorem stamp duty (BSD, ABSD and SSD, whichever applies) is payable. A document signed in Singapore can be stamped without penalty within 14 days after signing. IRAS says backdating an Option to avoid a higher ABSD rate is an offence under the Stamp Duties Act, punishable on conviction by a fine of up to SGD 10,000, imprisonment of up to 3 years, or both.Selling within four yearsStamp duty calculator
For residential property, IRAS counts the SSD holding period from the date the OTP is accepted. For the date of sale, IRAS lists the date the buyer accepts the OTP first, then the date of the sale and purchase agreement and, where neither applies, the date of transfer; an OTP subject to signing a sale and purchase agreement is excluded in both cases. An OTP exercised on or after 4 July 2025 falls under the revised schedule — 16%, 12%, 8% and 4% for a sale within the 1st, 2nd, 3rd and 4th year, and none after 4 years — even if it was granted earlier, with no transition period.Buying from a developerMortgage calculator
Under the Housing Developers Rules, a licensed developer’s booking fee is 5% to 10% of the price; for an uncompleted home, URA’s guide says exercising includes paying 20% of the price less the booking fee. On an example SGD 800,000 unit with a 5% booking fee, Money Snap’s arithmetic gives SGD 40,000 at booking and SGD 120,000 more as the balance down payment, paid at exercise or, if the developer allows, within 8 weeks of the option date. If the option is not exercised, the developer may forfeit SGD 10,000, 25% of the booking fee.Common misconceptions
Five things people get wrong
The option fee is paid on top of the resale price.
For an HDB resale flat, HDB says the Option Fee and Option Exercise Fee may be negotiated with the sellers and form part of the resale price.
The Option Exercise Fee can be up to SGD 5,000 on its own.
HDB caps the Option Fee and Option Exercise Fee together at SGD 5,000, so the exercise fee is at most SGD 5,000 less the Option Fee paid: SGD 4,000 after an SGD 1,000 Option Fee.
Every OTP is valid for 21 days.
The 21 calendar days, expiring at 4pm on the 21st calendar day, is HDB’s Option Period for a resale flat. A licensed developer’s option is valid for 3 weeks from the day after the sale and purchase agreement and title deeds are delivered, unless the Controller of Housing permits a different period, and the template CEA publishes for other private homes stays open until a date the parties fill in, or two weeks.
CPF savings can pay an HDB resale flat’s Option Fee.
For an HDB resale flat, HDB lists the OTP deposit to the sellers, SGD 2 to SGD 5,000 made up of the Option Fee and Option Exercise Fee, among the payments that must be made in cash.
The option fee is refunded if the buyer does not go ahead.
For an HDB resale flat, the Option Fee is forfeited when the OTP expires unexercised, and the sellers keep it. For a licensed developer’s option on an uncompleted home, URA says the developer may forfeit 25% of the booking fee and refund 75%.
Sources and reviewChecked against the HDB, IRAS, URA and CEA pages and the Housing Developers Rules on 2026-10-01
- HDB — Option to Purchase when buying a resale flat — the form, the fees, the Option Period and exercise
- HDB — Option to Purchase when selling a flat — the Intent to Sell, expiry at 4pm and a lapsed OTP
- HDB — Request for Value — the deadline, the fee and the outcome
- HDB — Mode of financing for a resale flat — the cash deposit, the loan basis and the CPF usage cap
- IRAS — Buyer’s Stamp Duty — acceptance of an OTP as a dutiable purchase
- IRAS — When to pay stamp duty — the 14-day stamping window
- IRAS — Additional Buyer’s Stamp Duty — the date of purchase and backdating
- IRAS — Seller’s Stamp Duty for residential property — the holding period and the 2025 schedule
- Singapore Statutes Online — Housing Developers Rules — the booking fee and the option’s validity
- URA — Home Buyers’ Guide, Step 3 — exercising a developer’s option and forfeiture
- CEA — Buying or selling a private residential property — the standard contract templates
- CEA — Option to Purchase template for private residential property (Version 1.2) — the template’s terms
Official HDB, IRAS, URA and CEA pages and the Housing Developers Rules, for general information only. Not financial advice.
This page is provided for educational and informational purposes only. It does not constitute financial advice. All figures and worked examples are estimates for illustrative purposes, are subject to change, and do not reflect any individual’s circumstances. Always refer to HDB, IRAS, URA and CEA and seek independent professional advice before making any financial decisions.