7 min read
Two common expressions you’ll hear in Singapore are “What? Why is an EC so expensive?” followed by “What? The EC sold out again?”
Few market watchers will ever forget the famed Piermont Grand EC. When it first came on the scene, we heard one criticism after another: it’s too expensive, Sumang Walk is not convenient, there’s no MRT station, etc. And yet, Piermont Grand was one of the better selling projects after all; some would say because of its EC status (it was the only EC launched in its year).For those curious, it has sold 86% of its 820 units at the time of writing.
And in 2021, if you head to an EC show flat, you’re bound to notice a large throng of buyers who are upgrading from their HDB flat. This often leads to the question of why so many upgraders prefer ECs – and we’ll tell you right away, it’s about more than just the price:
HDB upgraders seem to love ECs and resale ECs
As an example, let’s look at some recent resale EC transactions, from developments completed in 2015 (to account for the the usual five-year Minimum Occupation Period, or MOP)
1. Waterwoods (Punggol)
| Date | Unit Size | Price | Buyer address |
| 15 Jan 2021 | 1,044 sq.ft. | $1,050,000 | HDB |
| 7 Jan 2021 | 807 sq.ft. | $775,00 | HDB |
| 6 Jan 2021 | 1,044 sq. ft. | $990,000 | HDB |
| 4 Jan 2021 | 1,044 sq. ft. | $1,016,800 | HDB |
| 15 Dec 2020 | 1,044 sq. ft. | $970,000 | Private |
2. Heron Bay (Hougang)
| Date | Unit Size | Price | Buyer address |
| 11 Jan 2021 | 1,281 sq. ft. | $1,300,000 | HDB |
| 5 Jan 2021 | 1,281 sq. ft.. | $1,250,00 | HDB |
| 30 Dec 2020 | 1,389 sq. ft. | $1,370,000 | Private |
| 28 Dec 2020 | 1,023 sq. ft. | $942,000 | HDB |
| 22 Dec 2020 | 775 sq. ft. | $760,000 | Private |
3. 1 Canberra (Yishun)
| Date | Unit Size | Price | Buyer address |
| 15 Jan 2021 | 1,442 sq. ft. | $1,300,000 | HDB |
| 8 Jan 2021 | 1,270 sq. ft.. | $1,250,00 | HDB |
| 7 Jan 2021 | 1,055 sq. ft. | $1,370,000 | HDB |
| 4 Jan 2021 | 1,582 sq. ft. | $942,000 | HDB |
| 29 Dec 2020 | 947 sq. ft. | $840,000 | HDB |
While we don’t have data for buyers of new ECs yet, we’re certain that a quick visit to any show flat – along with conversations with some agents – will also reveal the popularity of ECs with HDB upgraders.
You may be wondering why that is, given that private condos tend to have more accessible locations (ECs are often further from MRT stations, barring the occasional exception like Parc Canberra). These are the reasons to consider:
- Price
- Additional Buyers Stamp Duty (ABSD)
- The HDB-like restrictions are immaterial to these buyers
- Increasing number of ECs in better locations
1. Price and financing
Let’s get the most obvious factor out of the way: ECs are priced lower. This matters a great deal for HDB upgraders, especially as they need to take bank loans (there’s no HDB loan for ECs).
As of December last year, the island-wide average price for condos was about $1.63 million, while the average for ECs was around $1.066 million; a price difference of about 34.6 per cent (do note that the gap has narrowed from five years ago though).
With a bank loan, the average EC has a minimum down payment of about $266,500, of which at least $53,300 must be in cash (the rest can come from CPF). This can usually be covered by the sale of, say, a 4-room flat at $350,000.
For the average condo, the minimum down payment is about $407,500, of which at least $81,500 needs to be in cash. There’s a higher chance that the sale proceeds from a flat won’t cover the full amount, especially the cash portion after refunding CPF.
In addition to the price difference, there is up to $30,000 in grant for ECs. Not a huge amount, but every little bit helps.
But to give you a clearer idea of the EC vs private condo price gap, let me show you the average prices from 2020.
| Project | District | Average Price | District Average Price | District Average New Launch Price |
| Ola | 19 | $1,138 | $1,279 | $1,437 |
| Parc Canberra | 27 | $1,102 | $985 | $1,131 |
| Piermont Grand | 19 | $1,105 | $1,279 | $1,437 |
| Rivercove | 19 | $978 | $1,279 | $1,437 |
For those wondering about the low prices of District 27, it’s worth noting that there weren’t a lot of transactions in 2020 for resale condos, and the bulk of new sales were due to Parc Canberra.
2. Additional Buyers Stamp Duty (ABSD)
When you upgrade to a condo, you can either sell your flat first, or buy the condo first. For most families, it’s more convenient to buy the condo first – this allows them to live in their flat until the condo unit is ready to move into.
However, buying the condo while still owning your flat will incur the ABSD; the condo counts as the second property. At present, this is 12 per cent for Singapore Citizens, and 15 per cent for Permanent Residents.
So if you want to upgrade to a $1.63 million condo, for instance, this incurs ABSD of $195,600. Note that if you purchase the condo with a non-citizen spouse, the higher ABSD rate will apply; so if your spouse is a Permanent Resident, this means paying $244,500.
You can apply for ABSD remission later, if you meet the requirements and also sell your flat within the next six months. But at the immediate moment, the ABSD must be paid two weeks after completing the transaction.
This compounds the problem in point 1: the down payment on a private condo is already more substantial, and the addition of upfront ABSD can make it even more unmanageable.
There is, further, the stress of having to sell your flat within the time limit.
But with an EC, there’s no need to pay the upfront ABSD. That means the upgraders can still live in their flat while waiting to collect the keys to the EC; and that they don’t have to worry about ABSD remission deadlines.
Additionally, HDB upgraders who are moving from “difficult” units – such as units where a neighbour is targeted by loan sharks – also face higher risks with the six-month ABSD time limit.
3. The HDB-like restrictions are immaterial to these buyers
As HDB upgraders previously qualified for a flat, they can most likely qualify for an EC also – the only issue is the income ceiling (ECs still have an income ceiling, but it’s $16,000 instead of $14,000).
Restrictions such as ethnic quotas, or meeting eligibility requirements, are thresholds through which HDB upgraders have already passed, and can probably pass again.
As most HDB upgraders are owner-occupiers rather than investors, the disadvantage of waiting 10 years* for privatisation isn’t too significant to them. In addition, there’s no MOP for the second batch of EC buyers anyway, so they can already sell to PRs or rent out the unit.
*Less if it’s a resale EC.
4. Increasing number of ECs in better locations
While ECs have a reputation for being more inaccessible, launches in recent years have shown significant improvement.
For example, ECs like The Brownstone, Esparina Residences, Parc Canberra, etc. are all within walking distance to an MRT station. We were able to locate 26 ECs in which residents are close to a train station.
To be clear, ECs are still not the most accessible developments in general – but we have seen a marked improvement over the past few years. In addition, the decentralisation of Singapore, along with the appearance of more and more MRT stations, is gradually eroding this drawback of ECs.
We can think of ECs as yet another intermediary step, between an HDB flat and a condo
With loan curbs and the ABSD in place, the jump from an HDB flat to a condo is a much wider hurdle compared to the early 2000’s. This is what makes ECs such a favourite among many HDB upgraders today – it’s a “bridge” between their HDB flat and a full-fledged private condo; and we think the appeal will rise even further in a Covid-19 economy.
This isn’t to say every HDB upgrader should immediately pick an EC first; different financial situations and goals may dictate otherwise. But it does mean that upgraders who can’t make the jump to a condo just yet – or who want to exercise greater prudence – might do well to examine EC offerings first.
You can find out more about new and resale ECs from the in-depth reviews we do at Stacked; or contact us directly, so we can help determine whether an EC is right for you.
FAQs
4 Reasons Why HDB Upgraders Prefer Executive Condos To Private Condos? ›
In addition, ECs are subsidized by the government thus not everyone can just walk in and buy executive condominiums. There are restrictions, rules, and regulations that need to be followed. Private condominiums, on the other hand, comes with little to no restrictions at all, it is the epitome of modern-day living.
How do people upgrade HDB to condo? ›- Keep your HDB flat and buy condo.
- Buy condo first then sell your HDB flat.
- Sell your HDB flat first then buy condo.
- Sell your HDB flat and buy condo concurrently.
In addition, ECs are subsidized by the government thus not everyone can just walk in and buy executive condominiums. There are restrictions, rules, and regulations that need to be followed. Private condominiums, on the other hand, comes with little to no restrictions at all, it is the epitome of modern-day living.
Is executive condo a HDB? ›Executive Condos Are Bound by HDB's Rules for 10 Years
As mentioned above, ECs are considered as HDB properties in the first decade. During this period, you must abide by HDB rules, such as HDB's MOP, where you'll need to reside in your home for five years before you can sell/rent it out (only to SCs and PRs).
The Executive Apartment is an HDB flat which comes with an additional space that can be used as a study room or a living room. In addition to this, some of the executive apartments even come with a balcony space.
Is it worth to upgrade from HDB to condo? ›So it could be worth upgrading now if you believe that condo growth will still outpace HDB prices, you have an advantage with a longer loan tenure, and your cash proceeds won't be reduced as much because of accrued interest (and more importantly, you have good job security and progression).
Do I need to sell my HDB if I buy EC? ›Disposal of existing HDB flat
You and your family members listed in the application for the EC unit must dispose of any existing flat within 6 months of taking possession of the EC unit.
You will need to meet the Minimum Occupation Period (MOP) of 5 years before you can sell your EC. The MOP is calculated from the Temporary Occupation Permit (TOP) date for your EC. To find out if you have met the MOP, you may wish to check the TOP date for your EC or contact HDB.
What is the meaning of executive condo? ›Executive Condominium (EC) are strata-titled apartments which are built and sold by property developers to eligible Singaporean households. There are eligibility conditions and ownership restrictions in the first 5 years. Find out more about buying an EC unit from a property developer.
What are the two types of condos? ›There are two primary kinds of condos: freehold and leasehold. With freehold condos, the unit is owned by the tenant outright. Leasehold condos have tenants with contracts with their landlord instead of owning the unit.
Is EC or HDB better? ›
HDB flats have a significant price advantage over Executive Condominiums and are the preferred choice for many young couples. There are also cases where couples upgrade from HDB to EC, depending on a couples' financial situation and planning.
Is HDB better than condo? ›Affordability: HDB flats are more affordable, and offer a better value for money. Community: HDB flats offer a sense of community and a strong social network, which can be lacking in a condo.
What is the average price of an executive condo in Singapore? ›Median resale EC prices gained 31.9 per cent to $1,129 psf in 2022, from $856 psf in 2019. New EC prices, in contrast, grew 21.5 per cent to $1,338 psf, from $1,101 psf over the same period.
What does Executive HDB mean? ›Unlike the Executive Maisonette which have two storeys, executive apartments are single-floor units. Apart from their spaciousness, another unique feature of executive apartments lies in their unit layout, which comprises a study room and a balcony.
What is the difference between HDB and EC in Singapore? ›EC units have 99-years lease while resale HDB flats have leases that are below 99 years. To use CPF to buy HDB flats, the flat units must have at least a 20-year lease. The remaining lease of the flat unit determines the amount of loan you can get to finance your purchase.
What is the most common HDB type? ›If you are purchasing a Build-to-Order (BTO) flat from HDB, you can choose from 2-room Flexi, 3-, 4-, 5-room, to 3Gen flats. One of the most common HDB BTO flat types is the 4-room flat, which offers a comfortable living space for young couples and families. With 3 bedrooms, there is adequate space for rest and play.
Why do people upgrade to condo? ›Probably the main reason for most people to upgrade to a condo will be the benefits for the family. Whether it be safer grounds for kids to run around, kids swimming pools, playgrounds or sporting facilities – these are all tough things to put a price on.
Are higher floors better in condos? ›Living on the higher floors provides more safety as opposed to lower floors. You can open your windows during the night without the worry of an unwanted circumstance. Higher resale value. Living higher up offers more privacy, better views and appreciates faster than a condo on the ground floor.
What renovations increase condo value the most? ›Upgrade the kitchen
Improvements to the kitchen often yield the highest return for condo owners. The kitchen holds many areas for improvement including cabinets, countertops, sinks, faucets, and lighting. Often considered the heart of the home, the kitchen can make or break the perceived value of a condo. Our pro tip?
If you own a condo, you cannot own an HDB flat at the same time. You would need to sell your condo before buying an HDB flat. You may buy a resale flat if you sell your condo within six months of moving in.
How long can I buy HDB after selling condo? ›
As part of the property cooling measures introduced on 30 Sep 2022, private residential property owners (PPOs) and ex-PPOs are required to serve a wait-out period of 15 months after the disposal of their private properties before they are eligible to buy a non-subsidised resale flat.
What is the difference between HDB and condo in Singapore? ›Condominiums, or “condos” for short, are privately-owned buildings and unlike HDB flats, they can be purchased by foreign citizens. There are usually fewer eligiblity requirements to purchase condos in Singapore—if you have the financial means, your age range and marital status are practically irrelevant.
Can I buy resale executive condominium? ›You must be a Singapore Citizens (SC) or Singapore Permanent Residents (SPR) in order to buy a EC from 6th year occupation period. You need not to form a family nucleus to buy a EC from the open market. For e.g. a single person SC or SPR above 21 can buy a EC from the open market.
Do condos hold their resale value? ›Condos tend to appreciate steadily in value and offer a solid return on investment — but they come with their share of drawbacks too. Our goal is to give you the tools and confidence you need to improve your finances.
How much can I profit from EC? ›Nearly all ECs resold in the past 15 years made a profit averaging S$300k. 4,263 or 99.9% of the Executive Condominium (EC) units sold in the resale market between 2007 and end-August 2022 yielded an average gross profit of S$295,904 each.
What are the features of executive condo? ›It usually consists of multi-story buildings consisting of apartments and often shares common facilities like swimming pools, clubhouses, parking lots, etc., It is typically built by developers and sold exclusively through commercial real estate agencies; some units are rented out while others remain unoccupied most of ...
What is the top level of condo called? ›A penthouse is an apartment or unit on the highest floor of an apartment building, condominium, hotel or tower.
How many rooms does an executive apartment have? ›Executive Apartment
In terms of design and size, they have three bedrooms and two bathrooms (similar to 5-room flats).
The biggest difference between a condo and an apartment is ownership. An apartment is defined as a residence that is rented, often as part of a larger residential building. A condo can be similar in structure to an apartment — usually a unit within a larger residential building — but condos are owned instead of rented.
What's the difference between a condo and a complex? ›Apartments are typically housed within a complex of dozens or hundreds of similar units, and the units are owned by a single entity and leased out. A condo is owned by one individual (or couple, etc) and is either owner-occupied or rented out.
What are the different classification of condos? ›
Types of Condominiums
Condominiums are classified into two types: freehold and leasehold. With freehold condominiums, the tenant owns the unit outright. Leasehold condominiums require tenants to enter into contracts with their landlord rather than own the unit.
If you're planning to buy a condo or HDB flat, then one of the biggest considerations is deciding between a high-floor or low-floor unit. Generally, many prefer units on higher floors because the consensus is that they are 'better' since they offer more privacy and better views, among other things.
Is HDB worth it? ›Thus, HDB resale flats are a good option if you don't want to waste time waiting or renting. However, with prices at a record high, do consider if the price you're paying is worth it based on the remaining years left on the lease.
Which floor is best in condo? ›Pros of Purchasing a Condo on an Upper Floor
On a higher floor, you won't have to have to deal with street noise. In addition to this, you can enjoy a great view. You'll also have a financial benefit because a condo unit on the higher floors usually has a higher resale value because of the amazing views.
Higher-floor condo units are generally cited as peaceful and noise-free, but that's not always the case. It really depends on which floor your building's facilities are located on. For ground-floor facilities, the lower floors are definitely more susceptible to the noise, given the higher footfall.
Is HDB higher floor more expensive? ›Units on higher floors are generally more expensive than those on lower floors. This is because they offer better views and more privacy, which are desirable features for many buyers.
Can foreigners buy EC in Singapore? ›Can foreigners buy an executive condo? Yes, foreigners can buy an executive condo (EC) in Singapore. For HDB eligibility guidelines, more information is here or email HDB at hdbsales@mailbox.hdb.gov.sg.
What is the income ceiling for executive condo in Singapore? ›Your monthly household income must not exceed $16,000.
Who can buy executive condo in Singapore? ›Eligibility to buy an Executive Condominium
At least one of the applicants needs to be a Singapore Citizen (SC), with the other being a SC or Singapore Permanent Resident, and both applicants need to be a SC if they are making a purchase under the Singles scheme. The monthly household income must not exceed $16,000.
An essential occupier, as defined by HDB, “is a family member who forms a family nucleus with the applicant to qualify for a flat from HDB”. This can be a spouse, child, parent or sibling. He/she does not have any share in the flat, even if he has paid cash for it.
What is the income ceiling for HDB? ›
There is no income restriction for the purchase of a resale HDB flat on the open market. 4. HDB is committed to helping Singaporeans, particularly first-timers and lower to middle-income families, to own a home.
How big is an executive house? ›In the real estate industry the term commonly denotes large four to six bedroom houses, often older homes but sometimes high-cost new developments.
Can I upgrade from HDB to EC? ›Yes: if your TOP happens to be 3 to 4 years later, you won't have to service any mortgage loan for the EC over those 3 to 4 years. Deferred payment scheme gives you ample time to accumulate your cash and CPF, and then sell your HDB flat closer to your EC key collection date.
What is the difference between executive condo and condo? ›An executive condo is a type of housing unit that is developed and sold by a private developer but which comes with certain restrictions. ECs are typically more spacious and luxurious than HDB flats, offering amenities such as swimming pools and gyms.
Which is the best EC in Singapore? ›| EC Name | Planning Area | MRT < 1 km |
|---|---|---|
| Hundred Palms Residences | Hougang | Serangoon North (U/C, 2029) |
| iNz Residence | Choa Chu Kang | Choa Chu Kang West (U/C, 2026) |
| Northwave | Woodlands | Nil |
| Treasure Crest | Sengkang | Sengkang |
Completed in 1981, The Clover @ Kebun Baru was HDB's experimental attempt to infuse a unique identity in each of the town, to inject life and interest in the otherwise monotonous public housing architecture. This landmark design is in the shape of a clover and the first and the only circular HDB flat in Singapore.
What is the most luxury HDB? ›| # | Towns | 5-Room |
|---|---|---|
| 1 | Bukit Merah | $899,000 |
| 2 | Bishan | $877,500 |
| 3 | Ang Mo Kio | $868,000 |
| 4 | Toa Payoh | $865,000 |
| Upgrading from | Top up required |
|---|---|
| HDB to EC | $58,720 |
| HDB to condo | $183,720 |
| HDB to landed house | $558,720 |
Minimum Occupation Period (MOP) To be able to upgrade to a condo or landed property from your HDB flat, you need to have completed the Minimum Occupation Period (MOP) for your HDB flat. Typically, you need to have been living in your HDB flat for a minimum period of 5 years before you can upgrade to private property.
Can I buy condo after having HDB? ›Yes. After the 5-year minimum occupancy period (MOP), if you're a HDB owner and want to own a private condominium. If you want to buy a condominium, you need to purchase a condo at least 5 years from the date you buy your HDB flat.
What renovations add the most value to a condo? ›
Improvements to the kitchen often yield the highest return for condo owners. The kitchen holds many areas for improvement including cabinets, countertops, sinks, faucets, and lighting. Often considered the heart of the home, the kitchen can make or break the perceived value of a condo. Our pro tip?
Is it worth upgrading a condo? ›Are Condo Upgrades Worth It? Upgrading a condo can be a worthwhile investment. Keep in mind that you don't want to spend more than what people would expect the features to be worth and more than the condo demands – meaning don't put low-quality fixtures into the kitchen of a luxury condo.
Can I change the windows in my condo Singapore? ›A renovation permit from HDB is required for all windows replacement work. A BCA Approved Window Contractor (AWC) who is listed in HDB's Directory of Renovation Contractors needs to apply a renovation permit from HDB before carrying out the window replacement works.
Can I buy a HDB if I own a private property? ›Owners of private property or owners who have disposed of a private property within the last 15 months may take over the ownership of an HDB flat if they meet the following: The existing flat owner has fulfilled the requisite occupation period. At least 1 of the proposed owners is a Singapore Citizen.
Can I buy HDB if I have overseas property? ›In Singapore, it is prohibited to buy a Housing Development Board (HDB) flat if you already own real estate. In this context, real estate includes other HDB flats and both local and overseas private properties.
How can I make my condo more luxurious? ›Enhance the Space with Color & Lighting
Whites, neutrals, and lighter shades of paint make smaller rooms look and feel larger, and using pops of color for nooks, trim, and smaller walls makes the space feel more inviting. Hues of gray or silver are popular for luxury condos and add a sense of elegance to the unit.