Why do Executive Condominiums appeal to Buyers?
-
A status of achievement
-
Necessities within arms’ reach
-
Luxurious amenities to enjoy within the development
-
Greater upside for capital appreciation
Why are ECs cheaper than other Mass Market Condominiums?
-
Foreigners are not allowed to buy ECs directly from developers.
-
Income ceiling set at $12,000 and MSR of 30% set by the government. As such, EC developers are mindful of the affordability of the buyers who are eligible to purchase an EC.
-
Lower land costs (compared to mass market land sites). Prices for EC sites seem rather unaffected by the upward spiral of other private residential sites and have risen by a smaller margin. Over the past 2 year, bids have largely been range-bound between $300 and $350 psf per plot ration on average, which translates to an average selling price of between $730 to $800 pst (compared to $950 to $1,200 pst for mass market condominiums).
-
EC lands are mostly bidder by construction firms who are also developer. As such, there is no double layer profit between a developer n da construction firm.
Given these restrictions, ECs are typically priced t a discount compared to nearby private condos. In recent months, the demand of new ECs has, however, reached new highs, with units oversubscribed at launch.
Why are ECs Popular? A more in-depth analysis
-
Additional Buyer’s Stamp Duty (ABSD) is NOT applicable.
-
Seller’s Stamp Duty (SSD) is NOT applicable for EC as owners have to fulfill 5 years minimum occupation period (MOP).
-
Deferred payment is available. 20% down payment, 65% upon TOP and final 15% upon legal completion.
-
There is no restriction to invest in commercial/industrial property as long as there is no residential accommodation component in the commercial unit.
-
Improved design and features. EC developers are now offering more to attract buyers wishing to upgrade to a ‘subsidized’ private residential lifestyle living.
-
Great lifestyle (Enjoy the same lifestyle and facilities as other condominiums).
-
Possible CPF Housing Grant $20,000/$30,000 for 1st Timers.
-
Budget-friendly entry price (Lower quantum compared to mass market condominiums.
-
Comparable, or better potential future capital appreciation to condominiums (more likely to be sold at a good profit after MOP).
-
Can be sold under private property status after MOP of 5 years to Singapore Citizens and PRs, and to foreigners after 10 years – hence a larger pool of potential buyers.
-
Good potential rental yield as design and facilities are similar to any private condominiums.