Buying a car in Singapore is an aspiration for many. Many of us who cannot pay in cash for a vehicle can opt for a car loan. For many Singaporeans, it is a necessity. It Is hard to deny the convenience and empowerment a car can impart.
Buying a car in Singapore can be daunting, especially for those new to the process. With strict regulations, high prices, and limited space, navigating the car-buying process in Singapore can take time and effort. However, with the proper knowledge and preparation, buying a car in Singapore can be a smooth and rewarding experience. In this ultimate guide, we will explore everything you need to know about their new cars in Singapore and also the cost of owning a new car in Singapore.
Tips for buying a car in Singapore
1. Certificate of Entitlement (COE)
If you are buying a car in Singapore, you must register your new vehicle and obtain a Certificate of Entitlement in the selected vehicle category. It represents the right to vehicle ownership and the use of limited road space for around 10 years.
2. Determine your Budget
Singapore is one of the most expensive cities in the world, and cars are no exception. The cost of owning a car in Singapore is significantly higher than in many other countries due to the strict regulations and high taxes. Therefore, it is essential to clearly understand your financial situation and determine how much you can offer to spend on a car price in Singapore.
3. Loans and Installments
You may not have a total amount in cold hard cash to pay to a car dealership. Evaluating a car’s price in Singapore is essential, so we have installment loans and payments. For vehicles with an Open Market Value (OMV) of less than $20,000, the maximum loan tenure is seven years at 70℅ of the car price. But if your OMV is higher than $20,000, the whole car loan is at 60℅of the car price.
4. Choose your Car
Once you have determined your budget, the next step is to choose the type of car you want to buy. Singapore has many car models available, from small hatchbacks to luxury sports cars. It is essential to consider your lifestyle and needs when choosing a car. If you have a family, feel a larger car that can accommodate everyone comfortably. If you are looking for a vehicle for daily commuting, a smaller car with good fuel efficiency may be a better option.
5. Road tax
After buying a car in Singapore, there is also a mandatory tax that all vehicle owners should pay before their vehicles go on the road. Mostly, road tax options are renewable either yearly or on a six-month basis. Besides, before the road tax renewal, car owners should tick off prerequisites such as getting motor insurance coverage, passing the vehicle inspection, and clearing any outstanding fines.
6. Car Insurance
While buying a car in Singapore, you can opt for comprehensive car insurance, which includes fire coverage, theft, death or injury to other parties, medical costs, damages, and many more, depending on the provider.
7. Research Dealerships
Singapore has many car dealerships, each offering different prices and services. There are many new cars in Singapore, so it is essential to research the dealerships in your area to find one that offers fair prices and good customer service. You can also consider buying a car from a parallel importer, which may offer lower prices than authorized dealerships. As car prices in Singapore vary for different reasons, it is advisable to research a dealership that offers cars at a fair price.
8. Test Drive
Before buying a car in Singapore, taking the car for a test drive is essential. This will give you a feel for the vehicle and ensure it meets your needs and preferences. It is also logical to take the car on different types of roads to see how it performs in other conditions.
9. Negotiate the Price
Once you have found a car you like, it is time to negotiate the price. It is crucial to precisely understand the vehicle’s market value and current COE prices before entering into negotiations. You can also consider negotiating other aspects of the purchase, such as free servicing or an extended warranty.
10. Complete the Purchase
Once you have agreed on the price and other terms of the purchase, it is time to complete the transaction. This will involve filling out paperwork and making the necessary payments. It is essential to ensure that all the paperwork is in order and that you clearly understand the terms and conditions of the purchase.
Cost of buying a car in Singapore
A sedan costs between S$80,000 to S$150,000, including COE. Road tax is planned based on the engine capacity, but it can be around S$2 000 per year.
Besides, cars are exempt from inspection for the first 2 years and subject to biennial review from the 3rd to 10th year. Each inspection costs S$ 62.06, and subsequent re-inspection costs S$13.03.
Petrol prices differ between S$2 to S$2.50. Parking rates start at S$0.60 and reach S$5 per 30 minutes in the CBD. Singapore employs electronic road pricing (ERP) along busy roads and charges between S$0.50 to S$3 depending on the area and time of day.
Buying a car in Singapore can be complex and challenging, but with the proper knowledge and preparation, it can also be a rewarding experience. By following these seven steps, you can confidently navigate the car buying process and ensure you get the best possible deal on your new car. Remember to research, take your time, and negotiate the price to get the best possible value for your money.