It is just natural to be seduced by the idea of driving a state-of-the-art car each few years for a small month-to-month fee but this does not work for every person that is wanting to get a brand new car.
To make certain that you do not get caught out by means of signing up for a deal that is not suitable for you or one that you may not be able to afford at all, you should always contemplate on this.
There may be no such component as getting an amazing vehicle deal that makes financial sense in SIngapore. A vehicle is a luxurious thing that the average Singaporeans would want to have, even the cheap ones, and will struggle to afford. Even a number of the upper middle class in Singapore are having a hard time owning a car.
How much is a car worth in Singapore?
Purchasing a car in Singapore can be quite expensive as there are a lot of expenses that come with it but first and foremost, you need to consider the cost of the car itself.
You should count on spending within the range of S$106,000 for a simple sedan, about S$107,000 for a small SUV or crossover, and about S$183,000 for a luxury car in Singapore on an average. This is based on the 2017 data.
Singapore wants to regulate the whole quantity of cars in the country to keep traffic jam manageable that is why the purchasing fee consists of the value of the car itself that is decided by means of its OMV as well as the amount that you should pay to gain a Certificate of Entitlement (COE) or the right to buy and own a vehicle.
While you still need to worry about the purchase price of the car you are interested to buy, there are other fees that you need to take care of besides that and that includes
Registration fee, additional registration fee and the initial payment for the road tax. You may also be subject to a CEVS fee depending on the carbon emissions of the car that you are purchasing.
Additional Costs of getting a Car
Singapore has managed the number of vehicles in their roads because the government has pushed the price of car ownership through the fees and taxes. These are as follows?
Certificate of Entitlement or COE
This is basically the document that will give you the legal right to own, register and use the car in Singapore for 10 years. Most of the time, COE for a simple sedan would cost you approximately S$30,000 to S$50,000.
This is also the main reason why the price of vehicles in Singapore are expensive. The COE rate will definitely be different depending on the car that you have and the supply and demand.
Open Market Value or OMV
This is determined by the Customs department of Singapore and will be based on the actual price of the vehicle. This includes the purchase price, the freight fees, insurance and other charges that were added to the shipment of the vehicle.
Additional Registration Fee or ARF
This is a tax that is imposed and mandated upon the registration of a new car. This is being calculated based on the percentage of the open market value of the car.
This is another tax that is being applied by the Singaporean customs and is 20% of the open market value of the vehicle.
This is mandated by the Land Transportation Authority in Singapore and is priced at $220 upon the car registration.
Vehicular Emissions Scheme Surcharge or VES
This is another taxation scheme that was implemented to reduce the carbon emission and pollutants like hydrocarbons, nitrogen oxide, particulate matter and carbon monoxide. This also encourages the people in Singapore to purchase cars that are environment friendly.
On top of all these, they also charge road tax, IU fee, dealer’s commission and car plate number fee.
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How much do you need to repay monthly?
Probably the cheapest new car in the market now is the Perodua Bezza 1.3 Premium X (Automatic) that is at S$57,800.
This will mean that you need to pay S$1,604.49 every month with a downpayment of S$17,340 that you need to pay in cash. You would probably need a S$7,511.23 income to be able to live comfortably and pay the cheapest car.
Vehicles with OMV surpassing S$20,000 will be entitled to a maximum loan amount of 60% of the car value and a 40% minimum down payment. If you are uncertain whether you could come up with the money for that certain car, study how much cash you can commit for the downpayment and see how it will work from there.
You can also use up a car loan calculator for you to know how much money you will need and be ready for the expenses of purchasing the vehicle.
Worth it or Not?
If you are ready for the expenses of getting a car and you have the money to finance it, then it will all be worth it because you will have the convenience of having your own car and go wherever you want to go. It will still all be up to you.
If you are determined to get a brand new car and you would like to get a car loan to finance for you, make sure you are ready to deal with your monthly installment loans as well as the car maintenance.
1 Fullerton Credit a licensed money lender will be more than happy to assist you with all your car loan needs with their huge variety of options for you to choose from.