Progressive Payment Scheme Breakdown For Singapore Homes

Understanding how payment works for new homes in Singapore isn’t just useful—it’s critical. If you’re planning to buy a property that’s still under construction, you’ll most likely encounter something known as the Progressive Payment Scheme (PPS). This structure is designed to reduce upfront financial pressure and spread out the costs over the different stages of the construction process.

In this article, I’ll walk you through how the scheme works, what to expect at each stage, and how it affects your cash flow and mortgage. We’ll also touch on real examples, to show how PPS applies in actual property scenarios.

Key Highlights

• Progressive Payment Scheme (PPS) applies to properties bought under construction (BCA).
• Payments are broken down and linked to project completion stages.
• Buyers only start repaying their home loan gradually.
• Useful for cash flow management during the building phase.
• Interest-only payments may apply during early stages of disbursement.
• Developments like River Green adopt this scheme for buyer flexibility.

What Is The Progressive Payment Scheme?

The Progressive Payment Scheme is a payment structure regulated by Singapore’s Urban Redevelopment Authority (URA). It’s available for properties sold under the Building Under Construction (BUC) status, such as condominiums and some landed developments. Instead of paying the full sum upfront, buyers pay in stages as the construction progresses.

This scheme is not only logical from a financial perspective, but it also provides some breathing room to prepare for full mortgage payments later on. Many buyers appreciate that their financial commitments align closely with the physical progress of their home.

Payment Stages Under PPS

The scheme is executed in structured stages, from booking the unit to the moment you receive your keys. Here’s how it typically works:

Each percentage represents a portion of the total purchase price. Your bank or financial institution will disburse the corresponding amount of your housing loan during each phase, so you’re only paying interest on the amount already released.

Managing Mortgage Under PPS

One of the major benefits of PPS is that it minimizes your loan interest payments in the early stages. Here’s how it generally works:

• When the loan is partially disbursed, you pay interest only.
• As more of the loan is released, your monthly payments increase.
• Full principal-plus-interest repayments only begin after full disbursement, usually post-TOP.

This setup can be ideal if you’re still renting or managing other financial commitments while waiting for your new home to be completed.

Let’s say you’re buying a unit at River Green, a new luxury condo development. When you book a unit, you pay 5% in cash upfront as the option fee. The rest follows the standard PPS breakdown. River Green, like many high-end projects, provides a clear timeline of construction phases, which helps buyers plan financially.

More importantly, developments like River Green often collaborate closely with banks to streamline the disbursement process. This keeps things transparent and reduces delays between construction milestones and loan disbursements.

When PPS Makes Sense

Not all homebuyers benefit equally from PPS. It’s most suitable for:

• First-time buyers who need time to build up reserves
• Upgraders waiting for their current home to be sold
• Investors who plan to resell or lease the unit post-TOP
• Buyers still paying rent and needing gradual cash flow adjustments

This is a flexible structure—but it’s still a commitment. Before entering into a PPS agreement, review your monthly income, CPF balance, and timeline for relocation.

Hidden Costs To Watch Out For

Though PPS helps with staged payments, it’s important to watch out for:

• Accruing interest: While early stages involve low interest, it can add up over time.
• Delay risks: Construction delays may push your move-in date, affecting other plans like rental contracts.
• Legal and administrative fees: Each disbursement stage may incur valuation checks and legal paperwork.

These aren’t deal-breakers, but they’re worth calculating ahead of time.

Like many niche projects in Singapore, Springleaf Residence follows the PPS model, giving homeowners a better handle on their finances while awaiting TOP.

This is especially beneficial for larger homes where the total quantum is higher, and cash flow management becomes more critical. Instead of paying, say, $3 million upfront, you spread it over several stages.

Alternatives To Progressive Payment Scheme

While PPS is the standard for BUC units, you might consider these options:

• Deferred Payment Scheme (DPS): Only available for completed properties. It allows buyers to defer payments for a set time (usually 2–3 years).
• Normal Payment Scheme: A variation where full disbursement may happen faster than under PPS, depending on the agreement.
• No loan needed: If you’re a cash buyer, the scheme may be irrelevant—but the timeline still applies for payment release.

Each option has its pros and cons, and the best fit depends on your personal timeline and financial structure.

Final Thoughts ─ Is PPS Right For You?

The Progressive Payment Scheme is not just about convenience—it’s about planning ahead. By understanding how and when your money is used in the purchase of a new home, you’ll be in a better position to manage your debt, cash flow, and overall financial health.

If you’re buying a unit under construction in Singapore, especially in developments like River Green or Springleaf Residence, PPS is the default option—and for good reason. It’s buyer-friendly, flexible, and designed for the long-term homeownership journey.

But like any financial commitment, it requires foresight. So don’t just look at what you’ll pay today—map out what’s coming 6, 12, even 24 months down the line.

Tip: Use a loan calculator that includes disbursement staging to project your repayment timeline more accurately. It can be an eye-opener.