Why EC Remains the Best Buy in Singapore Property Market ? In the highly competitive Singapore property market, executive condos (ECs) have emerged as the preferred choice for astute investors seeking a blend of luxury and affordability.
With prices significantly lower than private condos, ECs offer an enticing option for those looking to enter the market without compromising on quality.
Boasting an array of amenities and the potential for appreciation, ECs continue to be a solid investment choice for discerning individuals seeking a high standard of living.
Discover why ECs remain the best buy in the dynamic Singapore property market. Find out why ECs like Altura in Bukit Batok are so attractive. ECs like Tenet and Copen Grand are all sold out !
Table of Contents
Why EC Remains the Best Buy in Singapore Property Market : Key Takeaways
- Executive Condos in Singapore are a more affordable option compared to private condos, making them attractive to the upper middle class and high net worth individuals.
- Executive Condos offer the potential for appreciation as they are sold like private properties, even though they are bought as subsidized units with grants.
- Executive Condos provide convenience and access to amenities such as swimming pools and concierge services.
- Despite some disadvantages like higher price tags and maintenance requirements, Executive Condos remain a popular choice due to their affordability, flexibility, and luxury features.
Why EC Remains the Best Buy in Singapore Property Market : Reasons for ECs’ Appeal
One of the main reasons for the appeal of executive condos (ECs) in Singapore is their affordability compared to private condominiums. With a price gap of 47% between ECs and new private condos, ECs provide a more accessible option for individuals in the upper middle class and high net worth bracket.
Additionally, buyers may be eligible for a subsidy of up to S$30,000 under the CPF Housing Grant Scheme, further enhancing the affordability of ECs.
The potential for future gains through resale after the five-year minimum occupation period (MOP) or full privatisation also adds to the appeal of ECs. This combination of affordability and potential for appreciation makes ECs a desirable choice for those looking to invest in the Singapore property market and belong to a luxurious residential environment.
Why EC Remains the Best Buy in Singapore Property Market : Capital Gains from EC Resales
With the potential for healthy profits upon resale, executive condos (ECs) in Singapore have proven to be a lucrative investment option for buyers. The 10 biggest estimated capital gains from EC resales ranged from S$840,000 to nearly S$1.2 million. The Tampines Trilliant had the highest average capital gains by quantum on a project basis.
Ease of exit and potential upgrader demand in areas like Tengah contribute to capital gains. Additionally, the lower purchase price compared to private condos in the same area may result in higher rental yields. Past trends show healthy profits for first owners of new ECs upon resale. These impressive capital gains make investing in ECs an attractive option for individuals seeking to build wealth and secure their financial future.
| Executive Condo (EC) | Estimated Capital Gains (S$) |
|---|---|
| Tampines Trilliant | S$1.2 million |
| Other ECs | S$840,000 – S$1.2 million |
Why EC Remains the Best Buy in Singapore Property Market : Stable Demand Pool and Limited Stock
The stable demand pool and limited stock of executive condos (ECs) in Singapore contribute to their desirability in the property market. The following factors highlight why ECs are a sought-after choice for homebuyers:
- Limited supply creates scarcity, driving up demand and potential capital appreciation.
- The owner-occupier requirement ensures a stable demand pool, reducing the risk of speculative activity.
- HDB upgraders, with approximately 15,750 flats reaching the end of their five-year Minimum Occupation Period in 2023, will further support EC demand.
- The government’s limited release of new EC plots adds to the pent-up demand for these properties.
- The high demand and limited supply dynamics make ECs an attractive option for those seeking a sense of belonging and exclusivity in the property market.
As a result, ECs continue to be a favored choice for homebuyers looking for a balance between affordability and luxury living.
Why EC Remains the Best Buy in Singapore Property Market : Affordability Threshold
Rising EC prices may test the affordability threshold of potential buyers, as they grapple with the 30% mortgage servicing ratio (MSR) limit and financing constraints. Buyers can borrow just over S$900,000 from banks for their purchase, which may limit their options in the current market. However, there is still a significant number of new EC transactions priced below S$1.5 million, with 65% falling within this range. Despite the affordability challenges, buyers may seek help from their parents or rely on the proceeds from the sale of their HDB flats to make their purchase more feasible. The table below highlights the affordability of ECs in Singapore, showcasing the range of prices and the corresponding percentage of transactions.
| EC Price Range (S$) | Percentage of Transactions |
|---|---|
| Below 1 million | 15% |
| 1 million – 1.2 million | 20% |
| 1.2 million – 1.4 million | 30% |
| 1.4 million – 1.6 million | 15% |
| Above 1.6 million | 20% |
This table demonstrates that there are still affordable options available within the EC market, catering to the needs of potential buyers who may have budget constraints.
ECs’ Relevance in Singapore’s Housing System
ECs offer an alternative housing option for middle-income Singaporeans who are not eligible for HDB flats and find private condominiums too expensive. The relevance of ECs in Singapore’s housing system can be seen through the following points:
- Affordable homeownership: ECs provide an avenue for middle-income individuals to own a private property at a more affordable price compared to private condominiums.
- Social mobility: ECs improve social mobility by offering the sandwiched class an opportunity to upgrade from public housing to a higher-end living environment.
- Access to amenities: Residents of ECs enjoy access to facilities such as swimming pools, clubhouses, and security services, enhancing their quality of life.
- Potential for appreciation: ECs have the potential for appreciation in value, allowing homeowners to build wealth over time.
- Community living: ECs foster a sense of belonging and community, providing an environment where residents can connect and build relationships.
Conclusion
In conclusion, executive condos (ECs) continue to be the best buy in the Singapore property market due to their unique blend of affordability and luxury.
With prices significantly lower than private condos and the potential for appreciation, ECs offer an attractive option for investors.
Additionally, the range of features and amenities provided by ECs ensure a high standard of living for residents.
Despite potential disadvantages, ECs remain a solid investment choice in the dynamic Singapore property market.
Read more about what are the common questions on buying an executive condo in Singapore.
