Option to Purchase

To grant an Option to Purchase (OTP) to a potential flat buyer, you need to have a valid Intent to Sell registered on My Flat Dashboard and meet the 7-day cooling-off period after registration.

After you have registered your Intent to Sell, you will be prompted to download a copy of the HDB-prescribed OTP. You and the flat buyers must use the prescribed OTP for the resale transaction. Any other agreements and/or supplementary agreements relating to the sale or purchase of the flat are not valid under the Housing and Development Act.

Print only 1 copy of the OTP as each form has a unique serial number. You must state the serial number of the OTP when you submit a resale application to HDB.

The OTP is a legally binding contract between you and the flat buyers. Read the Important Notes of the OTP and the Terms and Conditions of Resale carefully before entering into it.

Deposit to sellers

Flat buyers must pay you an Option Fee when you grant them an OTP, and an Option Exercise Fee when they exercise the OTP.

You may negotiate the amount for the Option Fee and the Option Exercise Fee with the flat buyers, which will form part of the resale price.

Payment by flat buyers to sellers Stage of OTP Amount to pay
Option Fee Granting of OTP Between $1 and $1,000
Option Exercise Fee Exercising of OTP An amount, which when including the Option Fee, will not exceed $5,000

You are encouraged to make payment using digital payment modes to secure independent proof of payment.

Procedure to enter into a contract using the OTP

OTP process Jul 2023

Read the steps below for more details.

Step 1: Negotiate and agree on the resale price

You and the flat buyers have to mutually agree on the resale price of the flat.

You can check the recent transacted resale flat prices and use our HDB Map Services and resale statistics to help you in setting the selling price of your flat. The latest resale prices reflect the market conditions at the time of the transactions.

Before entering into an OTP

Ensure that you have registered your Intent to Sell.

You can only grant an OTP to the flat buyers after you have waited out the 7-day cooling-off period upon registering the Intent to Sell.
When entering the OTP

You and the flat buyers must declare the true resale price of the flat to HDB, and must not enter into any supplementary/other agreements or arrangements that may cause the resale price as declared to be inflated or understated.

Note:It is an offence to give false information relating to the resale application - HDB may take the necessary action(s) as stated in the Terms & Conditions, Option to Purchase and Application Form(s).

Step 2: Grant the OTP to the flat buyers

You may grant an OTP to the flat buyers at the agreed resale price.

You can grant an OTP to the flat buyers after the 7-day cooling period upon registering your Intent to Sell. During the cooling-off period, you should consider the next housing options available to you, if you have not already planned for it.

If you decide to sell your flat, you may grant the OTP to the flat buyers at the agreed resale price.

Completing the OTP

You must fill in these sections in the OTP:

Page Sections
1
  • Option date
  • Flat address
  • Purchase price (resale price of the flat)
  • Option Fee (between $1 to $1,000)
  • Option Expiry Date (21 calendar days from the option day, including Saturdays, Sundays and Public Holidays. For example, if you grant an Option to the flat buyers on 1 April, the Option will expire on 22 April at 4pm)
  • Names (as in NRIC) and NRIC numbers of all flat sellers and buyers
2 Clause 6.1(c): Option Exercise Fee
4 Clause 12: Number of days from the date of exercising the Option that you and the flat buyers have agreed to submit the resale application to HDB
8 (top half)
  • Option date
  • Flat address
  • You and all the co-owners of your flat must sign on the OTP
  • A witness may sign on the OTP (seller's salesperson or any person, aged 21 years or above, and not involved in the resale transaction)
9 (optional) Inventory list of the flat
10 (optional) Authorisation for another person to receive the Acceptance of the flat buyers when they exercise the OTP

Granting the OTP in exchange for Option Fee

You and all the co-owners of your flat need to sign the OTP and hand it to the flat buyers, who will pay you an Option Fee. The Option Fee is between $1 and $1,000, to be mutually agreed between you and the flat buyers.

Once you have granted the OTP to the flat buyers, you are not allowed to grant another OTP to other flat buyers until it expires.

Step 3: Buyers to exercise the OTP or allow OTP to expire

If the flat buyers wish to purchase the flat, they must exercise the OTP during the Option Period. You have to wait for the OTP to expire before granting another OTP.

The Option Period is 21 calendar days (including Saturdays, Sundays, and Public Holidays), from the date of granting the OTP (refer to Step 2). It expires at 4pm on the 21st calendar day.

Flat buyers proceed with flat purchase: Exercise the OTP

If the flat buyers wish to purchase the flat, they must exercise the OTP within the Option Period.

Signing and returning the OTP

To exercise the option, the flat buyers must sign the OTP and return it to you:

Page Sections
8 (bottom half)
  • All flat buyers must sign on the “ACCEPTANCE” section of the OTP
  • A witness may sign on the OTP (your salesperson or any person, aged 21 years or above, and not involved in the resale transaction)

Option Exercise Fee

When the flat buyers exercise the OTP, they need to pay you an Option Exercise Fee. The amount as stated in Step 2 is to be mutually agreed upon between you and the flat buyers .

Flat buyers not proceeding with flat purchase: Allow OTP to expire

If the flat buyers do not wish to proceed with the purchase, they will not exercise the OTP. The flat buyers will forfeit the Option Fee paid, and you get to keep it. You can only grant another OTP after the Option Expiry Date.

Step 4: Submit the resale application

After the flat buyers have exercised the OTP, you and the flat buyers must decide when to submit the respective portions of the resale application to HDB.

You and the flat buyers must both submit your respective portions of the resale application separately within both timeframes:

  • Within the agreed number of days on page 4 of the OTP, and
  • Within 7 calendar days of each other’s submission

A resale application is only considered complete when HDB has received both you and the flat buyers’ respective portions of the resale application and the necessary supporting documents.

Read about submitting a resale application and what you need to do before the application is accepted and approved.