What is Executive Condominium (EC)?
Executive Condominiums (ECs) are a hybrid form of property development in Singapore where it is a private condominium but purchaser have to follow HDB rules and regulations for the first 10 years. A 5-year Minimum Occupation Period (MOP) of the unit prevents an EC owner from leasing or selling during that time. After the MOP period, this unit can be sold back to Singaporeans or PRs, and an EC project is only fully privatised after 10 years – meaning that they will be open for all buyers after that. ECs were first introduced in the 1990s and the aim of EC’s is to provide housing for middle-to-high income earners, but not the very wealthy. Affordability is the key reason as they are are much cheaper than private condos because as a public-private housing hybrid, ECs are heavily subsidised by the government. There will always be robust demand for them whenever a new EC projects hits the market.
If you’re looking into private property instead of public property for your next move, an Executive Condominium (EC) could be the perfect choice for you. With the Singapore’s housing market on the rise, ECs are becoming more and more of a hot topic. Today’s entry level prices have risen significantly in recent years making it increasingly difficult for young Singaporeans or HDB upgrader to purchase a private property. As former National Development Minister Khaw Boon Wan aptly put it back in 2013 – “buying an EC is like buying a Lexus at the price of a Corolla”. Depends on income level, Singaporeans get government subsidies of up to $30,000 when they purchase a EC.
The 6 criteria to buy EC
Age:
⦁ At least 21 years old
⦁ At least 35 years old for Joint Single Scheme
Minimum occupation Period (MOP):
⦁ 5 years for HDB flat
Citizenship:
⦁ Singapore citizen with another Singapore citizen or Permanent Resident (PR). All singles have to be Singapore citizen for Joint Single Scheme.
Family Nucleus:
⦁ Public Scheme
⦁ Fiancé/Fiancée Scheme
⦁ Orphans Scheme
⦁ Joint Singles Scheme
Income Ceiling:
⦁ Have a gross household income of not exceeding $16,000
Property ownership:
⦁ You do not own other property locally or overseas, or have not disposed of any property within the last 30 months.
⦁ You have not bought a new HDB/ DBSS flat or EC, or received a CPF Housing Grant before (1st-Timer); or, have only bought 1 of these properties/ received 1 CPF Housing Grant thus far (2nd-Timer).
5 Key reasons to buy EC
Upside potential
⦁ EC can be sold after a MOP of 5 years period to Singapore citizens and permanent residents. It will becomes a full fledged private condominium in 10 years, this give EC the values as a good investment vehicle for capital gains, no restrictions for selling as compare to HDB flats, not forgetting that you will be enjoying the facilities all this years as well.
Entry price
⦁ EC is priced much lower as compared to a normal condominium because of subsidization by the government and the conditions that comes with purchasing it, hence making it a private property where only the priviledge can own.
Housing grant
⦁ EC is the only private property where HDB grant is given for first timer purchaser.
No ABSD
⦁ Additional Buyer Stamp Duty (ABSD) does not applys for purchasing EC. You can even loan up to 75% LTV even if you owns a HDB at the moment.
Deferred payment
⦁ Deferred Payment Scheme (DPS) is available for all EC, this is something you will not see in the private property market. DPS enable the buyer to pay just 20% in down payment and pay the rest upon receiving Notice of Vacant Procession (TOP).
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