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Property Negative Sales

Losing Money from Property Sale


When I discuss sales of properties with my clients, most or rather all of them naturally assume that there will be a profit or extra money from the sale.

But that is not always the case.

Having encountered such property negative sales situations on 3 separate occasions in this year alone, I figured this might be a useful topic to explore on my blog where I share my take on various property topics.

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Table of Contents

What is Property Negative Sale?

To explain negative sale plainly, let me use a simple formula:

Sale Price (price at which you sell your flat) – Costs (various costs that are associated with the selling of the flat) = Sale Proceeds (this can be positive or negative)

Some common costs associated with the selling of a flat include outstanding mortgage loan, repayment of CPF amount used with accrued CPF interest and more.

If your property sale price is higher than your costs, then congratulations, you have positive Sale Proceeds – meaning you will have incoming money that goes into your pocket or for your next property purchase.

However, if your costs are higher than your sale price, then you have negative Sale Proceeds – meaning you are now faced with a situation where you will not receive money from the sale and may have to pay from your pocket, just to sell your property

Wondering how it can even be possible to land yourself in the second scenario?

Let me explain with a real-life case study.

Property Negative Sale Case Study

A couple, let us call them Mr. and Mrs. Ong came to me looking to sell their Clementi 5 room flat so they can upgrade to a condo.

As usual, I will do a financial assessment for them to let them know upfront what they should be expecting.

Here is the breakdown:

Potential Sale Price: Based on the prevailing current market selling price, the flat would be able to fetch around $510,000.

Potential Costs:

  • They have an outstanding mortgage loan on the flat, which is $135,000.

  • Mr Ong used $267,000 from his CPF to pay for the flat to-date, with the accruing interest of $68,000 over the entire period of occupation.

  • Mrs Ong used $90,000 from her CPF, with the accruing interest of $20,000.

  • This brings the bulk of their estimated costs to be around $580,000.

Using the formula above to calculate:

Potential Sale Price ($510,000) – Potential Costs ($580,000) = Negative Sale (- $70,000).

And there you have it, how it is very possible to land yourself in a situation of negative sale.

While that burst their bubble of expecting to use their sale proceeds to fund their new property purchase, they are not the only ones.

What Are the Main Reasons for Property Negative Sales? Can It Be Avoided?

Like I shared, negative sales are not an uncommon occurrence here in Singapore. If you are keen to avoid landing yourself in such a situation?

Do read on to learn about some of the key factors that result in negative sales and how to avoid them.

1) Home Loans

When most homeowners purchase a property in Singapore, they take out a home loan.

So, it makes sense that you have to repay the bank principal and interest (cost for borrowing) when you sell off your property.

If your mortgage interest rates are higher than the appreciation rate of your property, chances are you will have a deficit.

So how to reduce your chances of a negative sale?

Make sure you keep your home interest rates low, refinancing whenever you can get a lower rate.

It may be a hassle, but it helps you keep the amount you need to repay when selling as low as possible.

2) Repayment of CPF Accrued Interest

With CPF’s goal to ensure that we have sufficient retirement savings, when the property is sold, owners will need to return the drawn down principal amount PLUS the Accrued Interest, back into your CPF OA.

This amount may include the following:

  • The initial down payment that was withdrawn from our CPF account
  • The monthly installments that was withdrawn to pay our mortgage loan
  • Any HDB housing grant(s) that we received for our HDB flat
  • The CPF Accrued Interest on all the above

Do your best to sell your property at or above market value!

From the net positive sales proceeds, you will be able to repay the interest rates including the CPF accrued interest

3) Selling Within the First 3 Years

Deciding to sell a property within the first 3 years that it was bought will subject the homeowner to Seller’s Stamp Duty – a tax on the sales proceeds ranging from 12% (first year) to 4% (on the third year).

Just imagine, 4% on a $500,000 property is already $20,000, much less 12%.

How to minimize your chances of a negative sale?

Avoid selling within the first 3 years if at all possible. Just waiting for a few months to cross the 3-year mark is worth the while to avoid any unnecessary costs.

4) The Importance of Choosing Your Initial Property

I cannot emphasise enough that the most important factor is as simple as choosing the RIGHT property to buy.

With proper market research and analysis, your property will likely be on the right track of growth and prevent you from landing yourself in an unnecessary negative sale situation.

This option seems pretty straightforward but many tend to overlook the key value of decision-making for your first property purchase.

Just remember that this one crucial choice will lead to your benefit and gain, for many years ahead.

Should You Sell in a Negative Sale Scenario?

negative sale property

Assuming you did all you could to minimize your chances of facing a negative sale scenario but still ended up in this unfortunate situation, what should you do?

Do you sell or hold on?

The answer depends on the following factors:

Why Do You Want to Sell?

If the main motivation for selling is something that is not essential, maybe consider postponing it to allow yourself the opportunity to sell above market value or re-evaluate if it is still a wise decision knowing that it will be a negative sale.

What is Your Next Purchase?

If there is nothing more that can be done to reduce the costs, look forward instead.

Will your next home be an asset instead of the loss-making venture this current property is?

Instead, focus on looking out for the next property and do your due diligence to ensure that history does not repeat itself.

Do You Foresee the Negative Sales Situation to Improve?

In certain situations, where the property has only been in the market for a short time or you are trying to sell during a recession, there is a possibility that the negative sales situation could turn around – if selling prices improve.

However, if that is not the situation, and it is unlikely for the selling prices to improve, then the only way to go is down – with CPF accrued interest snowballing and house value dropping over time.

In this case, biting the bullet now would potentially be a better choice as it will only get worse in the future.

HDB Financial Calculator

Still not confident of calculating it yourself? You can reach out to me for a FREE Property Report


I hope the above factors can help you understand Property Negative Sales better.

Are you faced with the thorny issue of negative sales and need professional advices? Feel free to reach out to me.

Bonus for my readers


My readers can request a 1-time free 30 min Dynamic Property consultation. Schedule one now


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Mr Ang
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As a investor interested in taking advantage of the booming property market in Singapore, I needed a realtor with in-depth knowledge of the local market. Using his understanding of the various sectors of the market, Rick generated a investment progression report and we decided to buy a condominium in a choice area with huge potential for multiple returns in the future. Thanks Rick, I will definitely be doing business with you for a long time!
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I am writing in to compliment Rick Huang for his invaluable service, for the sale of my Esparina Residences. The process was complicated but he was able to empathize with my situation and also provide brilliant advices that ensue the smooth transaction. In all, I am appreciative with his professionalism and human touch in this journey. Thank you!
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My husband and I started our home-search by ourselves but was met with issues soon enough as we were unsure of the important things and areas to look out for and we were also not experienced in the negotiation process with the seller’s representing agent. Soon after hearing our problems, I was introduced to Rick by a friend. The entire buying process quickly became swift and smooth; Rick understands our needs, puts our personal interest first, seals us a good deal and educated us along the way about the important things and areas to pay attention to. Thumbs up to Rick and we will recommend him to anyone for their home-search
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"In short, Rick did an amazing job. He sold our house at a higher than initially discussed price and got us a good deal for our purchase. Both my wife and I are impressed with his professional yet friendly approach. We will definitely work with him again and recommend him to anyone."
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Self Introduction


Rick Huang, Associate Deputy Group Director of OrangeTee & Tie, has been in the Real Estate industry for a decade.

He is driven, committed and is enthusiastic about real estate investments.

Today, he leads Team Youhome.sg, and together, he aims to provide his clients with the best experience in their property journey.

The team focuses on understanding the client’s finances and needs and is determined about delivering the best solutions and results for them.

Amidst the hustle and bustle, Rick enjoys quiet time and indulge himself in the intricate art of tea-brewing and teapot appreciation.

He would also take this chance to energize himself and reflect on his personal development and areas of improvement.

He is also a proud fur daddy to 2 rescue kitties and loves spending his free time with his wife and furbabies.

Related Articles:

Ever wonder if you are suitable for Sell one buy two investment concept? – Read more (Sell one buy two)

Is buying new launch or resale condo have better returns? – Read more (New Launch vs Resale condo)

Looking to upgrade from Hdb to condo? – Read more (Sell Hdb buy condo)

What to take note when selling Hdb resale flat? – Read more (Hdb Resale Process)

Buying another Hdb flat, and using the fund from current home? – Read more (Hdb contra)

Why do some Hdb flat price depreciate so much? – Read more (Hdb depreciation curve)

What is one of the most common reason for property negative sales? – Read more (Cpf accrued interest)

Financial calculation for selling a Hdb flat? – Read more (Hdb resale calculator)

Buying EC before selling your HDB? – Read more (Upgrade to EC before selling your HDB)

Should you sell your EC after 5 years? – Read more (Selling EC)

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