Useful Information About Executive Condo In Singapore
An executive Condo is a subsidised private condominium – a hybrid between private and public housing. Executive Condo Housing Scheme was launched in 1996. It is designed to cater to the needs of those whose household incomes exceed the ceiling for public housing but are not quite yet able to afford private property.
To ensure a fair housing system and affordability for this group of people, a set of stringent eligibility criteria is unavoidable. Also, EC buyers have to meet the 5-year minimum occupation period before they can sell their EC in the open market, and some resale restrictions from 6th to 10th year.
Our aim is to help EC buyers to make a wise decision when it comes to buying Executive Condo in Singapore. We will provide timely information on the following sections:
Proper Planning for Buying EC
- Why Buying Executive Condo Is A Better Choice? (EC Benefits)
- Financial Planning for Buying Executive Condo (EC Financing)
- Bridging Loan for EC Purchase
- Payment Schemes Available for Buying Executive Condo
- CPF Housing Grant for Buying HDB EC (CPF Grant for EC)
- Resale Levy for Second-Timer EC Applicants
Rules / Restrictions on Buying EC
- Their income levels clustered around the S$10,000 threshold. They tend to be more financially savvy. They have a choice between buying an EC or applying for a Build-to-Order HDB flat.
- They are eligible for a CPF family grant of up to S$30,000.
Second-timers (HDB upgraders)
- Their income levels clustered around the S$10,000 to $14,000 threshold.
- This group mainly consists of families with children, and they are looking to upgrade to between an EC or private development.
Executive Condo (HDB EC) has been getting so popular in these few years. What are the reasons behind it?
The “intention of EC” is to target home buyers who might not qualify for public housing but cannot afford private property. However, the true fact is, Executive Condo does not only attract this group of sandwich class Singaporean.
More and more people are buying EC. Take-up for New Executive Condominium in Singapore has been high. Many rich people also finding their ways to enter into the Executive Condo market. The government has to implement some EC cooling measures (on 9th Dec 2013) to cool down the EC market.
EC location is one of the key factors that must be considered carefully, be it the EC purchase is for your own stay or for investment.
When it comes to buying a new launch EC, there’s a minimum occupation period of 5 years upon TOP. As it is for your own stay by default at the beginning, ideally, the EC should be in a location that is matured, convenient, with plenty of amenities nearby, a place you and your family are familiar with.
However, if you do not want to miss the opportunity to enjoy the potential capital appreciation that an EC can bring to you, you should consider an EC that is located at somewhere yet to be fully developed, with full of future potential.
Executive Condos are performing quite in line with the performance of private condos. Let’s name a few reasons why Executive Condos in Singapore enjoy greater capital appreciation:
- HDB EC buyers need to fulfil several sales restrictions which are fully lifted after 10 years. The upfront discount for EC purchase is partly to compensate for the illiquidity during MOP, which is a significant benefit.
- As ECs are strictly not for sale or rent during MOP period, but for owner occupation, the opportunity to sell for a profit or collecting rental income is almost zero for at least five years.
- At the first launch, the pool of buyers for ECs is restricted to Singaporeans, earnings up to $14,000 per month.
Therefore, some form of extra return (greater capital appreciation) has to be in place to compensate for the three conditions, once these restrictions are partially or fully lifted.
First-timer households will also enjoy a CPF Housing Grant up to $30,000.
Apparently, the New EC Launch in Singapore that offers a very affordable and attractive, and comparable if not better facilities and services to a private condo, it is definitely something you can’t miss, especially if you are eligible for it.
The case for ECs as a value investment has become stronger!
Executive Condo can only be occupied when a TOP is granted.
The Executive Condominium (EC) owners who have occupied their EC and have yet to meet the 5-year minimum occupation period (MOP) cannot sell their EC in the open market.
Executive Condominium owners who have occupied their EC and met the 5-year minimum occupation period (MOP) can sell their EC in the open market. The 5-year MOP is computed from the date of issuance of Temporary Occupation Permit (TOP) in respect of each EC.
After the 5-year MOP, from 6th to 10th year, EC can be sold in the open market to those who can meet the following eligibility conditions.
- Citizenship – You must be a Singapore Citizen (SC) or a Singapore Permanent Resident (SPR) in order to buy an EC in the 6th to 10th year occupation period.
- Family Nucleus – You need not form a family nucleus to buy an EC from the open market.
- CPF Housing Grant – Buyers of resale EC are not eligible for CPF Housing Grant as such EC is treated as equivalent to “private housing”.
From 11th year, all restrictions will be lifted. Foreigners and corporate bodies can buy EC Executive Condominium in the open market from the 11th year of the EC project.
Resale Executive Condo (EC) is another spotlight in the residential property market.
A few top reasons why people want to buy Resale EC:
- You can’t wait up to several years to move into the New Launch Executive Condo (EC). Buying Resale EC, you can move into the unit within weeks.
- There’s more room for negotiation the Resale EC Price compared to the New Launch EC.
- There’s more room for negotiation the Resale EC Price compared to the Private Condo.
- You can visit a Resale EC to see the actual condition of the property. Seeing a floor plan or showroom isn’t the same as walking through a completed unit.
- Resale Executive Condos are generally cheaper than New Launch EC.
- Resale Executive Condos typically have more living space compared to New Launch EC.