Singapore
How the COE System Works for Expats in Singapore
Quick answer: To buy a car in Singapore, you first need a Certificate of Entitlement (COE) — a government-issued quota licence that gives you the right to own a vehicle for 10 years. Without one, you can't register a car. COE prices are set by open bidding twice a month and move constantly: in the July 2026 second bidding exercise, which closed on 22 July 2026, Category A closed at S$126,000 and Category B at S$129,890. That is on top of the car, the taxes and the dealer's margin.
➜ Want the number for a specific car? Use our free Singapore car on-road price calculator. Enter an OMV and a COE premium — or the advertised price, and it works backwards to show you how much of that price is tax.
When I first arrived in Singapore and asked about buying a car, a colleague looked at me with something between sympathy and amusement. "You know about the COE, right?" I didn't. What followed was one of the more expensive education sessions of my life.
The Certificate of Entitlement is unlike anything most expats have encountered before. It's not a tax, exactly. It's not a registration fee. It's a government quota system designed to control the number of vehicles on Singapore's roads — and it means that before you can even think about buying a car, you need to win one at auction.
Here's how it actually works.
What Is a COE and Why Does Singapore Have It?
Singapore is a tiny island. About 736 square kilometres. In the 1990s, traffic was becoming a serious problem — not future-problem serious, but gridlock-now serious. The government's solution was characteristically direct: limit the number of cars that can exist on the road at any one time.
The COE system was introduced in 1990. It works like this:
- The government decides how many new vehicles can be registered each month
- That number is divided into categories (more on this below)
- Buyers submit bids in fortnightly open auctions
- The lowest successful bid in each auction sets the COE price for that round
- Win a COE, and you have the right to register a vehicle for 10 years
At the end of 10 years, you either scrap the vehicle, export it, or pay to renew the COE for another 5 or 10 years (at the Prevailing Quota Premium — which is also set by market price).
COE Categories Explained
There are five COE categories. As an expat buying a family car, you'll almost certainly be looking at:
Category A — Cars with engines up to 1,600cc and power output not exceeding 97kW. Think Toyota Vios, Honda Jazz, Mazda 2. This category typically has lower COE prices because it attracts higher demand and more supply.
Category B — Cars above 1,600cc or above 97kW. BMWs, larger SUVs, most European family cars. Higher COE prices. Premium manufacturers tend to sit here.
Category E — Open category. Any vehicle type can bid here. Prices tend to be the highest because competition is broadest.
For most expats, Category A is the practical choice. The cars are reliable, practical for Singapore's roads, and the total cost of ownership is more manageable.
What Does a COE Actually Cost?
This is where expats get a shock.
Through 2026 Category A has traded between S$102,009 (January, first bidding) and S$129,000 (July, first bidding). Category B has run at a similar level — the two categories have converged, and Cat A has closed above Cat B in several rounds.
These prices fluctuate significantly based on supply and quota allocations. In 2020, during COVID, COE prices dropped to S$30,000–S$40,000 for Category A. By 2023 they had surged above S$100,000. The market moves.
You don't bid for COEs yourself in most cases. When you buy through a dealer, the dealer bids on your behalf and includes the COE cost in the total vehicle price. That said, you should always ask your dealer to show you the COE component separately — it affects the depreciation calculation significantly.
This article contains affiliate links. If you click through and buy or sign up, we may earn a small commission at no extra cost to you. We only recommend tools and services we'd suggest to a friend.
If you're not yet sold on the idea of dropping S$130,000+ on a 10-year COE, it's worth pricing a car subscription as an alternative — for short postings it often wins on total cost. We walk through the maths in car subscription vs ownership in Singapore, including which operators are worth quoting and what the all-in monthly figure typically covers.
The Full Cost of a Car in Singapore: What Expats Actually Pay
The COE is one piece of a bigger cost puzzle. Here's the real breakdown for a mid-range family sedan. Every figure below is LTA's own, from its Car Cost Update for cars registered in June 2026 — a Honda Civic 2.0 e:HEV, Category B:
Yes. A Honda Civic costs S$240,000 in Singapore, of which about S$35,500 is the car and roughly S$180,000 is tax and COE. The exact same car costs £22,000 in the UK.
You can run any car through the same arithmetic with our on-road price calculator.
This isn't a uniquely Singapore rip-off — it's deliberate policy. The government does not want unlimited car ownership on a tiny island, and the pricing mechanism enforces that.
Should You Buy a Car as an Expat?
Honestly? For many expats, the answer is no — or at least, not immediately.
Singapore has excellent public transport. The MRT is clean, reliable, air-conditioned, and covers most of the island. Grab (Southeast Asia's Uber) is cheap by Western standards. Monthly public transport costs are typically S$100–S$150.
Car ownership in Singapore typically costs S$1,500–S$2,500 per month when you factor in loan repayments, insurance, road tax, parking, and ERP tolls.
That said, if you have young children, live in areas with less MRT coverage (parts of the East Coast, Holland Village area, Bukit Timah), or frequently travel between cities in Malaysia, car ownership makes practical sense.
How to Buy a Car as an Expat in Singapore
- Check your employment pass validity — Lenders typically want at least 1 year remaining on your pass to approve a car loan. More detail on expat-specific loan rules in our Singapore car loans + MAS LTV guide.
- Move your cash into SGD properly — transfers via UK/US high-street banks often strip S$500–S$1,500 on a typical deposit due to poor FX rates. A specialist FX provider such as Wise is the standard fix for expats funding an SGD deposit or COE bid.
- Choose your car and category — Test drive at dealerships; Category A for most expats
- Arrange financing — Singapore banks (DBS, OCBC, UOB) offer car loans up to the MAS cap of 70% of purchase price (OMV ≤ S$20,000) or 60% (OMV above that); loan tenure up to 7 years; flat interest rates typically around 2.5–3.5% per annum
- Dealer submits COE bid — You'll pay a deposit; the dealer bids on your behalf at the next fortnightly exercise
- COE confirmed — Collection of vehicle typically within a few weeks of successful bid
What to Watch Out For
Hidden dealer margins on COE. Some dealers quote an artificially high COE cost and pocket the difference if they secure the COE at a lower price. Always ask for documentation showing the actual COE bid result.
Short remaining COE on used cars. Singapore has a thriving used car market. Cars with fewer than 5 years of COE remaining are much cheaper — but you'll face a large renewal cost or scrapping decision sooner than you expect.
Depreciation is steep. New cars in Singapore depreciate heavily in the early years. A car bought for S$150,000 today might be worth S$70,000 in five years. Budget for this from day one.
Loan limits are strict. MAS — not LTA — caps car loans at 70% of the purchase price for cars with an OMV of S$20,000 or below, and 60% for cars above that, over a maximum seven-year tenure. These caps have been in force since May 2016. You'll need a significant cash deposit.
Affiliate disclosure: We work with a small number of vetted partners whose products we'd genuinely recommend to a friend in the same situation. Commissions help us keep this site free to read and independent of advertiser pressure. We never recommend a product we wouldn't use ourselves, and we update pricing and terms as soon as we find them changed.
Frequently Asked Questions
Can I use a foreign driving licence in Singapore? Yes, for up to 12 months if you hold a valid foreign licence. After that, you'll need a Singapore driving licence. Nationals of most Western countries can convert their licence without retaking the full test — but you may need a conversion test depending on your home country.
Can I buy a car on a short-term employment pass? Technically yes, but financing will be difficult. Banks typically want a minimum 12 months remaining on your employment pass to approve a loan.
Is it better to buy new or used? Used cars can offer better value if you find one with sufficient COE remaining (7+ years ideally). New cars come with warranties and the assurance of full COE tenure. Both have merits.
What happens to my car if I leave Singapore? You can sell it (through a dealer or privately), export it, or scrap it. If the car still has PARF eligibility (original COE, less than 10 years old), you'll receive a PARF rebate — which can be substantial. Time your departure and sale carefully.
Do I need a COE to buy a motorcycle or van? Yes — all vehicles in Singapore require a COE. Motorcycles (Category D) and commercial vehicles (Category C) have their own quota pools and separate pricing.
Related guides: Car Insurance for Expats in Singapore | Converting Your Foreign Driving Licence | Should Expats Buy or Lease a Car in Singapore?
Last updated: August 2026 | COE figures verified against LTA bidding results, 5 August 2026