Guide to Buying a Car in Singapore: Tips and Tricks of the Trade

Owning a car may be a long-time dream for some, but when you’re living in Singapore or are planning to move in this charming island, you may need to re-examine the pros and cons of having a private car in light of the government’s vision as far as city transportation is concerned.

Here we outline some tips and things to know when buying a car in SG. We hope you find this guide useful as we share some terms and insights about the process and how it’s like to own a vehicle in this city.

car purchase sg

How to Buy a Car in Singapore: Things You Should Know

So here’s the deal, whether you’re buying a car for practical reasons, just to be fancy, or simply for the heck of it, understand that owning a private car in Singapore is ridiculously expensive as compared to other parts of the world. This is mainly because importing cars into the island comes at a hefty cost, not to mention the additional prices which the government imposes for tax measures and to regulate the number of private cars on this tiny island.

And if you haven’t heard, Singapore has one of the best public transportation systems in its region with fully air-conditioned trains and buses reaching virtually every part of the city – the very reason why most Singaporeans drop the idea of buying a private car for unbelievable prices.

If that’s not enough to convince you, then take a look at some of the fees you’ll have to deal with just for purchasing a car in Singapore:

  • Basic administrative fees ($140) – this is only for the paperwork to register your own car.
  • The Open Market Value (OMV) – this is the value price of the vehicle which includes all sale and shipment fees involved when importing a car into Singapore.
  • Additional Registration Fee (ARF) – This is added tax placed upon registering a vehicle. The tax value is calculated on a percentage-tierred rate depending on the vehicle’s OMV.
  • Excise Duty – valued at 20% of the OMV of the car to be purchased. So, the higher the car’s OMV (luxury or sports car), the higher this gets along with the ARF. Surprise!
  • Certificate of Entitlement – this is why having your own car in this country is considered a privilege. Each month, the Land Transportation Authority (LTA) only releases a limited number of COEs which will be up for bidding through an open bidding system. Successful bidders get a COE that is valid for up to 10 years from the date the vehicle was registered.


If the above list of fees seems a lot, the big news is those are just for purchasing a vehicle. There are still other fees that you need to pay to actually drive a car which include car insurance fees, road taxes, and Electronic Road Pricing (ERP).


Now if you are truly bent to have that car to drive around the city despite all the costs you need to deal with, we give you the following tips to help you make that good purchase:

  1. Do not let over-the-top sales talk get the better of you.

You should know by now that when something’s too good to be true, then it probably isn’t.

Talk is cheap but it could cost you more than what it’s really worth if you aren’t careful – remember, these salespeople could shower you with minor promotions and offer appealing deals just to get you cornered to get their sales up and earn higher commissions. Those who’ve been in the car dealing industry for a long time can easily sense minor body cues and speech inflections which could hint your preference for a particular type of vehicle and they may take advantage of your emotions to get you to buying that car without much thought.


  1. Do some background research on car specifications and pricing to avoid coming across as a complete newbie.

While it’s not important to know a lot about cars, it does help to come across as someone who knows and understands what he/she wants when it comes to purchasing a car. Car salespeople are eager to pounce on unsuspecting “greenhorns” so as to take full advantage of the sales and commission they can make out of them. Some things to consider:

  • Get the basic specifications that you want for a vehicle. This can be easily done through simple research. This will keep you focused on what you’re looking for in a car and will help you narrow down your choices to make a good purchase.
  • If someone asks you if you are financing, they mean to know if you are getting a car loan for your car purchase which you’ll be paying on a monthly basis. In such cases, always say that you haven’t made up your mind yet. Salespeople get more out of loans. On that note, be careful not to declare that you’re paying cash so that negotiations won’t become inflexible right off the bat.
  • Do not ask for their best price. This is a major giveaway for salespeople that you have little idea on negotiating and they can totally steer you the way which benefit them the most.
  • Take the car out for a test drive. You may know how good a car is on paper but not in a similar way as driving it on your own.
  • Finally, factor in the after costs of owning a car- including maintenance and other running expenses that you’ll have to deal with in the long run.
  • Important: Even when you’ve chosen a suitable car, salespersons won’t let you off that easily. They will offer more add-ons to embellish your ride and to increase their sales which can potentially leave you with an overpriced bill. If you’ve noticed, you will need to be more firm and assertive when going through this kind of negotiations for your own good.
  1.     Be proactive and make smart comparisons among various car dealers.

It’s important to go out there and compare deals and offers from various dealers because investing in a private car in Singapore is no joke. Expect car salespeople to swoon you with grand and irresistible offers but the smart buyer does not easily settle for what’s in front of him. You need to come up with an objective and a plan to make excellent decisions and to end up with a smart purchase that you won’t regret later on.


With all the aforementioned tips in mind, you are ready to invest your money on the car of your dreams. Buying a car in a country such as Singapore is certainly not for everyone, but for the informed and able, it will definitely be a rewarding experience considering the city’s first-class traffic systems, public infrastructures and road conditions.