What is the difference between the Progressive Payment Scheme and the Deferred Payment Scheme?

Under the **Progressive Payment Scheme (Normal)**, the buyer pays instalments **tied to construction milestones** at percentages prescribed by the Housing Developers Rules: **5%** booking fee, **15%** on signing the S&P, **10%** on foundation, **10%** on the reinforced concrete framework, **5%** each on partition walls, roofing, internal finishes and the car parks/roads/drains, **25%** on TOP and the final **15%** on CSC. The loan is drawn down progressively, so interest accrues only on what has been disbursed. A **Deferred Payment Scheme**, which defers most of the price at a **higher price**, cannot be offered on uncompleted private residential property, and from 8 May 2026 not on new ECs either (MND, 8 May 2026).

Is a booking fee for a new launch refundable if the buyer changes their mind?

Only partly. The booking fee is normally **5% of the purchase price** (rule 8 of the Housing Developers Rules allows 5% to 10%), paid in cash on the grant of the OTP. If the buyer does not exercise the Option within **3 weeks** of receiving the S&P, the developer is entitled to forfeit **25% of the booking fee** and must refund the remaining **75%**. So it is neither fully refundable nor wholly forfeit — never tell a client either.

What is the difference between TOP and CSC?

**TOP (Temporary Occupation Permit)** allows the building to be **occupied** — buyers can typically move in, and the **25%** instalment falls due. **CSC (Certificate of Statutory Completion)** is the **final legal completion** of the project, issued after outstanding requirements are met, and carries the final **15%**. The **defects liability period** is **12 months from the date the buyer receives the Notice of Vacant Possession**, during which the developer must make good defects at its own cost.

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Paper 2 · Private Sale

Sale of Uncompleted Private Property (New Launches)

Must-know for the exam

Sale of uncompleted private residential property is governed by the Housing Developers (Control and Licensing) Act; commercial uncompleted property falls under the Sale of Commercial Properties Act.
A developer must hold a valid sale licence, use prescribed statutory OTP and S&P forms, and keep buyers' monies ring-fenced in a project account.
The booking fee is 5% to 10% of the price (Housing Developers Rules r 8), paid in cash on grant of the OTP; CPF and bank loans cannot be used yet.
The developer must deliver the S&P within 14 days of granting the OTP, and the buyer then has 3 weeks (21 days) from receipt to exercise it.
If the buyer does not exercise the OTP, the developer may forfeit 25% of the booking fee and must refund the remaining 75%.
Under the Progressive Payment Scheme, 15% falls due on signing the S&P within 8 weeks of the OTP, so only 20% is payable before any construction milestone.
Milestone instalments are 10% each for foundation and reinforced concrete framework, then 5% each for partition walls, roofing, internal finishes and car parks, roads and drains.

A new launch is the sale of an uncompleted (under-construction) private residential property directly by a licensed housing developer. Unlike a resale, the buyer is committing to a home that does not yet physically exist, so the law wraps the transaction in a set of statutory protections — a sale licence, prescribed forms, staged payments and a ring-fenced project account. This lesson covers the framework you need for RES Paper 2 and how it differs from a completed/resale deal.

The regulatory framework

The sale of uncompleted private residential property is governed by the Housing Developers (Control and Licensing) Act and its rules. For commercial uncompleted property, the equivalent regime is the Sale of Commercial Properties Act. A developer building units for sale must hold a valid sale licence (or the relevant approval/exemption) before marketing and selling.

The developer must be licensed and comply with the applicable Act before selling uncompleted units.
Sales must be documented using prescribed statutory forms — the buyer cannot be asked to waive the built-in protections.
A project account must be maintained so that buyers' monies are ring-fenced for the project.
Always confirm the current licence status, rules and any thresholds with the developer, CEA or the relevant authority.

Prescribed forms: OTP and S&P

New launches use prescribed forms with buyer protections built in — you cannot substitute a private template. The two key documents are the statutory Option to Purchase (OTP) and the Sale and Purchase Agreement (S&P) in the standard prescribed form. On booking, the buyer pays a booking fee and is issued the OTP; the developer must then deliver the

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Common questions

What is the difference between the Progressive Payment Scheme and the Deferred Payment Scheme?: Under the **Progressive Payment Scheme (Normal)**, the buyer pays instalments **tied to construction milestones** at percentages prescribed by the Housing Developers Rules: **5%** booking fee, **15%** on signing the S&P, **10%** on foundation, **10%** on the reinforced concrete framework, **5%** each on partition walls, roofing, internal finishes and the car parks/roads/drains, **25%** on TOP and the final **15%** on CSC. The loan is drawn down progressively, so interest accrues only on what has been disbursed. A **Deferred Payment Scheme**, which defers most of the price at a **higher price**, cannot be offered on uncompleted private residential property, and from 8 May 2026 not on new ECs either (MND, 8 May 2026).
Is a booking fee for a new launch refundable if the buyer changes their mind?: Only partly. The booking fee is normally **5% of the purchase price** (rule 8 of the Housing Developers Rules allows 5% to 10%), paid in cash on the grant of the OTP. If the buyer does not exercise the Option within **3 weeks** of receiving the S&P, the developer is entitled to forfeit **25% of the booking fee** and must refund the remaining **75%**. So it is neither fully refundable nor wholly forfeit — never tell a client either.
What is the difference between TOP and CSC?: **TOP (Temporary Occupation Permit)** allows the building to be **occupied** — buyers can typically move in, and the **25%** instalment falls due. **CSC (Certificate of Statutory Completion)** is the **final legal completion** of the project, issued after outstanding requirements are met, and carries the final **15%**. The **defects liability period** is **12 months from the date the buyer receives the Notice of Vacant Possession**, during which the developer must make good defects at its own cost.

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Study material aligned to the public CEA syllabus. Not financial or legal advice — verify current figures with the relevant authority (IRAS, HDB, CEA, MAS).