Singapore is known for having one of the most expensive car ownership costs in the world. With high taxes, fees, and strict regulations, owning a car in this city-state can be a considerable expense. Here’s what to expect when you THINK you want to own a car in Singapore.

The Cost of Buying a Car

The first expense that a car owner in Singapore needs to consider is the cost of buying a car. In Singapore, there are two types of taxes that must be paid on top of the cost of the car itself. These taxes are the Additional Registration Fee (ARF) and the Certificate of Entitlement (COE).

  • The ARF is a tax that ranges from 100% to 180% of the car’s Open Market Value (OMV). The OMV is the price paid for the car before any taxes or fees are added. The higher the OMV, the higher the ARF.
  • The COE is a quota system that allows the government to control the number of cars on the road. It is essentially a license that allows the owner to use the car on Singaporean roads for ten years. The price of the COE is determined through a bidding process, and it can range from SGD 1 to SGD 100,000 or more. As of March, the average price of a mid-range car in Singapore is around SGD 100,000.

Monthly Fixed Costs

After purchasing a car, there are several fixed costs that car owners must pay each month. These costs include the car loan repayment, insurance, road tax, and parking fees.

Car Loan Repayment: Many Singaporeans opt for a car loan to finance their vehicle purchase. The monthly repayment amount depends on the loan amount, interest rate, and loan tenure. For example, a SGD 200,000 loan at a 2.5% interest rate for five years would result in a monthly repayment of SGD 3,611. But normally, you don’t have to because you will need to fork out a downpayment of 40%. So, your monthly should be around SGD 1,500. Then again, it’s still your money just paying in different modes.

Insurance: Car owners in Singapore are required to have car insurance, which covers damages to the car and third-party liabilities. The cost of insurance varies depending on the type of car, age and driving experience of the owner, and other factors. As an example, the average annual cost of comprehensive car insurance for a mid-range car is around SGD 1,200. When spread over 12 months, the monthly cost would be SGD 100. Note that if you just got your license, your insurance can cost more than SGD 2,000.

Road Tax: Road tax is an annual fee that must be paid to use the car on Singaporean roads. The amount of road tax is determined by the engine capacity of the car. For a mid-range car with an engine capacity of 1,600cc, the road tax is SGD 742 per year, or SGD 62 per month.

Parking Fees: Parking in Singapore can be quite expensive, especially in central areas. The cost of parking depends on the location and duration of parking. As a rough estimate, parking fees for a car in Central Business District can range from SGD 4 to SGD 8 per hour. Assuming an average of 2 hours of parking per day, the monthly cost of parking would be SGD 240. Pro tip: Season parking can be much cheaper if you work there. You can park whole day and even come during the weekends to pak tor!

Variable Costs

In addition to the fixed costs, there are also variable costs associated with car ownership. These costs include fuel, maintenance, and repairs.

Fuel: The cost of fuel in Singapore is relatively high, with the average price of petrol currently around SGD 2.78 per liter. The amount of fuel used depends on the car’s fuel efficiency and the owner’s driving habits. As an estimate, a mid-range car with an average fuel consumption of 10km/L and a monthly distance of 500km, will cost approximately SGD 139.

Maintenance and Repairs: Regular maintenance is necessary to keep the car in good condition and avoid costly repairs in the future. The cost of maintenance and repairs varies depending on the car’s age, model, and usage. As a rough estimate, the monthly cost of maintenance and repairs for a mid-range car would be around SGD 100 to SGD 200. If you maintain your car well, you probably only need to spend this much every 10,000 km or every 6 months.

Total Cost of Car Ownership

When all the costs are added up, the total cost of owning a mid-range car in Singapore can be quite staggering. Here is a breakdown of the monthly expenses:

  • Car loan repayment: SGD 3,611
  • Insurance: SGD 100 (Usually paid annually)
  • Road tax: SGD 62 (Usually paid annually)
  • Parking fees: SGD 240
  • Fuel: SGD 139
  • Maintenance and repairs: SGD 100 to SGD 200

Total: SGD 4,252 to SGD 4,352

Keep in mind that these costs are based on a mid-range car and can vary depending on the car’s make and model, usage, and other factors. Also, this does not include the initial cost of buying a car, which can add up to hundreds of thousands of dollars.

Alternatives to Car Ownership

Given the high cost of car ownership in Singapore, many people opt for alternative transportation options. Singapore has a well-developed public transportation system, including buses, trains, and taxis, that can be much more affordable than owning a car. Many people also choose to cycle or walk for short distances.

In recent years, ride-sharing services such as Grab and Gojek have become increasingly popular in Singapore, providing a convenient and affordable way to get around the city without the expense of car ownership.


Owning a car in Singapore can be an expensive proposition. With high taxes, fees, and strict regulations, the cost of buying and maintaining a car can add up quickly. While owning a car can provide convenience and freedom, it may not be worth the high expense for many Singaporeans. Alternatives such as public transportation, cycling, walking, and ride-sharing can provide a more cost-effective and sustainable way to get around the city.

So, do you still want to buy a car?

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