Buying a home that has not been built yet works differently from buying one that has. You pay in stages as the building goes up, over years rather than weeks, on a contract whose form is prescribed by law rather than drafted for your deal.
That prescription is a protection. It also means most of the terms people want to negotiate are not negotiable, and the ones that matter are the ones nobody reads.
The contract is a prescribed form
Sales of uncompleted residential units by licensed housing developers run on a sale and purchase agreement in the form set out in the Housing Developers Rules. The developer cannot rewrite it at will, and the payment schedule below comes from the same source.
Developers are licensed, and money you pay goes into a project account rather than straight to the developer, which is what protects buyers if a project runs into trouble.
The payment schedule
Payment follows construction. Each stage falls due within 14 days of the developer giving notice that the stage is complete.
| Stage | Instalment |
|---|---|
| On signing the agreement, within 8 weeks of the Option | 20% (including the booking fee) |
| Foundation work, including pile caps, completed | 10% |
| Reinforced concrete framework completed | 10% |
| Partition walls completed | 5% |
| Roofing completed | 5% |
| Door and window frames in position; electrical wiring, internal plastering and plumbing completed | 5% |
| Car park, roads and drains serving the estate completed | 5% |
| TOP or CSC issued, with services connected | 25% |
| Final payment on completion | 15% |
Two consequences worth thinking about before you commit.
Your cash flow is dictated by the builder’s progress, not by your plans. Stages can arrive faster than expected, and the notice starts a 14-day clock.
Your loan is drawn down progressively, so interest builds as the stages are paid, not all at once at the end. Budget for the total cost of carrying the purchase through construction, not just the price.
TOP and CSC are not the same thing
Temporary Occupation Permit (TOP) means the building is safe to occupy. This is when you get your keys, and when the 25% instalment falls due.
Certificate of Statutory Completion (CSC) comes later and confirms the development complies in full. The final 15% is tied to completion and the CSC position.
People use the two interchangeably and they are months apart.
The defects liability period
The developer must make good, at its own cost, any defect in the building that becomes apparent within the defects liability period: 12 months after the earlier of
- the date vacant possession is actually delivered to you, or
- the 15th day after you receive the TOP or CSC documents.
Twelve months sounds generous and passes quickly. Inspect properly on handover, log everything in writing, and do not let the period run out while you wait for a response.
If the developer is late
The prescribed agreement provides for liquidated damages where delivery is late, and those damages may be deducted from an instalment still owing to the developer. That is a real remedy rather than a gesture, and it is one reason to keep your own record of the dates.
Stamp duty still applies, on the same clock
Buyer’s Stamp Duty, and Additional Buyer’s Stamp Duty where it applies, are payable on the purchase in the ordinary way. See our note on stamp duty when buying property.
One point specific to uncompleted property: where a married couple buys a second property before selling the first and claims the ABSD remission, the six-month sale window runs from the issue of the TOP or CSC, whichever is earlier, rather than from the purchase date. That is a materially different deadline, and it is easy to plan against the wrong one.
Why this is quoted separately
Our residential conveyancing fees are published in full and assume a completed property. A purchase under construction is paid down against the developer’s progress over years, on the developer’s own contract, so it is quoted on its own terms.
What we do on these matters is read the agreement before you are bound by it, explain what the payment schedule will mean for your cash flow, and act on the stage payments, the handover and the defects position as the project runs.