“How much condo can we actually afford?” is the question every upgrader should ask first — and most ask last, after they’ve already viewed units above their ceiling. The answer isn’t set by your savings or your optimism. It’s set by a single regulatory formula: the Total Debt Servicing Ratio, or TDSR.
Understand TDSR and you’ll shop within reach from day one. Misjudge it and you’ll fall for a unit the bank simply won’t fund. Let me show you how it works, the two rules that trip up HDB upgraders specifically, and how to estimate your real ceiling.
The calculator applies the 55% TDSR cap at the 4% stress rate and your LTV to show the maximum condo you can finance.
What TDSR is
TDSR caps your total monthly debt repayments at 55% of your gross monthly income. “Total” means everything: the new condo mortgage, car loans, personal loans, education loans, and the minimum payments on your credit cards. Add them all up; they cannot exceed 55% of what you earn before CPF and tax.
The formula in plain terms:
(All monthly debt obligations + new mortgage repayment) ÷ Gross monthly income ≤ 55%
Two adjustments banks make that catch people out:
- Variable income is discounted by 30%. Bonuses, commissions, rental income and self-employed earnings are “haircut” — only 70% counts toward your income.
- The mortgage is stress-tested. Banks don’t calculate your repayment at the actual offered interest rate. They use a medium-term floor rate of 4% per annum (in force since 30 September 2022), even if your real rate is 3.5%. This deliberately builds in a buffer against rising rates.
The two rules unique to upgraders
1. MSR does not apply to your condo
When you bought your HDB, you were also bound by the Mortgage Servicing Ratio (MSR) — a stricter 30% cap. Good news: MSR applies only to HDB flats and to Executive Condominiums bought from the developer. It does not apply to private condos. When you upgrade to a private property, only the 55% TDSR governs your loan. That’s a meaningfully higher ceiling than you were used to as an HDB buyer.
2. An outstanding HDB loan slashes your LTV
This is the big one. TDSR tells you the maximum loan your income supports. But Loan-to-Value (LTV) tells you the maximum loan as a percentage of the property price — and it depends on whether you already hold a housing loan:
| Your situation | Max LTV | Downpayment needed |
|---|---|---|
| No existing housing loan | 75% | 25% (5% cash + 20% cash/CPF) |
| One outstanding housing loan (e.g. HDB) | 45% | 55% (25% cash + 30% cash/CPF) |
If you buy the condo while your HDB loan is still outstanding, your condo loan is capped at 45% — forcing a 55% downpayment. Selling first discharges the HDB loan and restores the full 75%. The strategic implications run deep, and I unpack them in Upgrading with an Outstanding HDB Loan.
A worked example
Meet a typical dual-income couple:
- Combined gross monthly income: $14,000
- Existing car loan: $1,200/month
- No outstanding HDB loan (they’re selling first)
Step 1 — TDSR ceiling: 55% × $14,000 = $7,700 available for all debt.
Step 2 — Subtract existing debt: $7,700 − $1,200 car loan = $6,500 available for the mortgage.
Step 3 — Convert to a maximum loan. At the 4% stress rate over a 30-year tenure, every $100,000 borrowed costs about $477/month. So:
$6,500 ÷ $477 × $100,000 ≈ $1,362,000 maximum loan
Step 4 — Apply LTV. With no existing loan, the 75% LTV means this $1.36M loan supports a condo priced up to:
$1,362,000 ÷ 0.75 ≈ $1,816,000 — if they have the 25% downpayment (~$454,000 in cash + CPF).
So this couple’s ceiling is roughly $1.8M, provided their cash and CPF cover the downpayment. If their downpayment funds only stretch to, say, $1.5M, then that becomes the real ceiling — the lower gate wins.
| Couple’s figures | Value |
|---|---|
| Gross monthly income | $14,000 |
| TDSR cap (55%) | $7,700 |
| Less car loan | −$1,200 |
| Mortgage headroom | $6,500 |
| Max loan (4% stress, 30 yrs) | ~$1,362,000 |
| Max condo by LTV (75%) | ~$1,816,000 |
| Downpayment required (25%) | ~$454,000 |
Levers that change your ceiling
- Clear small debts first. That $1,200 car loan cost them roughly $250,000 of borrowing power. Paying off a car or personal loan before applying can lift your budget materially.
- Loan tenure. A longer tenure lowers the monthly repayment and raises the max loan — but it’s capped at 30 years, and extending past age 65 reduces your LTV.
- Income recognition. Self-employed and commission earners face the 30% haircut; a clean, documented income record helps.
- Don’t forget ABSD in your cash plan. TDSR sizes your loan, but if you buy before selling you must also float 20% ABSD — see ABSD for HDB Sellers.
The bottom line
Your condo budget is governed by the 55% TDSR cap, stress-tested at 4%, and then bounded by your LTV — 75% if you’ve discharged your HDB loan, 45% if you haven’t. MSR no longer constrains you on a private purchase, which helps. But the binding limit is always the lower of “what your income can borrow” and “what your downpayment can cover.” Know both before you view a single showflat.
Net cash from your HDB sale, ABSD exposure, and the condo budget you can actually afford — worked out in about 2 minutes.
General information for Singapore HDB upgraders, not financial advice. TDSR, the stress-test rate and LTV limits are set by MAS and can change. The $477/$100,000 figure is illustrative for a 30-year tenure at 4%; confirm your actual eligibility with a bank or mortgage broker.