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An executive condominium (EC) is a popular type of housing in Singapore. They are a step above HDB flats and when you compare them with private condos, ECs cost less even though their design is not much different, nor are the facilities.

So, without further ado this article will cover everything you need to know before you venture out to buy an executive condo.

Table of Contents

What are Executive Condominiums (ECs)?

Pros:

1. New ECs Qualify for CPF Housing Grants (Only by First-Time Buyers)

2. Executive Condos Are Less Expensive Than Private Condos

3. Potential to Appreciate in Value

Cons: 

1. For 10 Years EC Owners Must Abide by HDB Rules

2. Executive Condos Are Primarily Located in the Outskirts

3. You Can Only Get Financing from a Bank

4. EC Launches Are Rare

5. People Who Buy Resale ECs Do Not Qualify for a CPF Housing Grant

How Executive Condos & Private Condos Differ:

Step-by-Step Guide for Buying an EC in Singapore

Can I Purchase a New EC Even Though I Already Own an HDB Flat?

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What are Executive Condominiums (ECs)?

Executive Condos (ECs) are an integral form of housing in Singapore and have been since the ‘90s. Sometimes referred to as “sandwich flats,” ECs are a public-private form of housing that works for the middle-class in Singapore. Those looking for an EC do not qualify for an HDB flat as their income exceeds the ceiling cap ($7,000 for a single buyer, and $14,000 for a couple) but find private condos too expensive. At the time this article is being written, the total household income for buying an EC is capped at $16,000.

Private property developers build ECs and sell them under the supervision of the Housing and Development Board (HDB). Although they are well-designed and have some of the same amenities as private condos, like clubhouses and swimming pools, they are more affordable. Khaw Boon, Singapore’s former National Development Minister said, “It’s like buying a Lexus for the same price as a Corolla.”

ECs are certainly a good buy, but there are some strings attached. First, not everyone is allowed to buy an EC from the developer. If you want to learn more about whether you would meet the eligibility criteria to buy an EC, please contact us.

Secondly, the 5-year Minimum Occupancy Period (MOP) must be met before an EC owner is allowed to rent out or sell the unit. After this, the owner can sell the unit only to Singapore Citizens and Singapore Permanent Residents. It takes 5 more years before an EC development becomes totally privatised, which is when the owner would be allowed to sell the unit to foreigners.

So, once your EC is privatised in its 11th year it becomes more valuable because you are now allowed to sell it to a much larger pool of potential buyers.

Here’s a chart outlining the pros and cons of purchasing an EC in Singapore:

Pros	Cons
New ECs qualify for CPF housing grants	Must follow HDB’s rules for the first10 years
Less expensive than private condos	Usually located more on the outskirts of town
Potential to appreciate in value	Not eligible for a housing loan from HDB
	Resale ECs not eligible to receive CPF housing grants
	Much fewer EC launches

Pros:

1. New ECs Qualify for CPF Housing Grants (Only by First-Time Buyers)

One of the best things about ECs is that first-time buyers are eligible to receive CPF Housing Grants, which can be a huge financial help. CPF offers two types of grants for those eligible to buy an EC:

• Family Grant
• Half-Housing Grant

There are a few catches besides having to be a first-time buyer: your gross monthly income cannot exceed $14,000, and you must qualify in terms of your citizenship and housing status, so it matters if your co-applicant is a second-time buyer.

The chart below shows how much is available from the CPF Family Grant as well as the Half-Housing Grant:

Family & Half-Housing Grant

Average gross monthly household income of all persons in application, i.e. occupants and occupiers	Family Grant		Half-housing Grant
	Singapore Citizen (SC / SC) Household	SC / Singapore Permanent Resident (SC/SPR Household	If you are a first-timer (FT) SC and your co-applicant is a second-timer (ST) who has previously taken 1 housing subsidy, i.e. FT / ST couple
$10,000 or lower	$30,000	$20,000	$15,000
$10,001 to $11,000	$20,000	$10,000	$10,000
$11,001 to $12,000	$10,000	Nil	$5,000
$12,001 to $14,000	Nil	Nil	Nil

2. Executive Condos Are Less Expensive Than Private Condos

In researching the 2020 cost of new ECs compared to the cost of new launches of non-landed private condos located in the Outside Central Region (OCR), we found that median unit prices of ECs were almost 39% less expensive than mass-marketed private condos.

Therefore, ECs offer a chance to purchase a “future private condo” while still benefitting from government subsidies. These could even reach as much as $30,000 for a Singaporean household if the income level qualifies.

At a less expensive price, plus a government subsidy, buyers are able to enjoy the types of amenities that typically come with a private condo, like BBQ pits, gyms, tennis courts, clubhouses, and swimming pools. ECs have fully equipped bathrooms and kitchens, along with finishes that resemble those of private condos.

3. Potential to Appreciate in Value

When you buy a property, the price you pay directly determines the chances of future gain or possibly losses when you eventually sell. When buying an EC, some think that the relatively less expensive price paid at launch may offer the potential for higher gains in the future. This would be after the 5-year MOP when the unit can be sold on the resale market and especially in the 11th year and later once the development has been privatised.

Everyone knows the goal is to buy low and sell high, but no one can guarantee that. A lot depends on what the housing market looks like, as well as the overall economy at the time of resale. Even so, many EC owners have made a tidy sum when they resold their home. Some of the largest EC transactions in 2020 occurred in developments like Bishan Loft, 1 Canberra, Esparina Residences, and The Tampines Trilliant.

Of 2020’s Top 5 EC resale transactions in terms of quantum, two deals that closed at Bishan Loft made their owners over $1 million in profits. After holding the unit for about 19 years, owners of a condo on the 25th floor sold it in April for $1.75 million, making them almost $1.1 million in profits. In November, the owner of a condo on the 15th floor of Bishan Loft made a profit of over $1.1 million upon selling the unit. Two owners of condos at The Tampines Trilliant recorded capital gains of more than $530,000 after a relatively brief holding period of approximately eight years.

Top 5 EC Resale Transactions by Quantum in 2020

	Project Name	Resale Date	Transacted Resale Price ($)	Resale Price ($PSF)	Holding Period From	Purchase Price ($)	Purchase Price ($PSF)	Capital Gains ($)
1	Esparina Residenes #18-XX	30 Mar 2020	1,808,000	700	29 Nov 2010	1,300,000	503	508,000
2	The Tampines Trilliant #15-XX	22 Jul 2020	1,800,000	904	No Prior Transaction for Unit
	1 Canberra #13-XX	05 Nov 2020	1,800,000	743	21 Dec 2012	1,408,600	582	391,400
3	The Tampines Trilliant #15-XX	27 Nov 2020	1,758,888	893	03 Oct 2012	1,210,000	614	548,888
4	Bishan Loft #25-XX	29 Apr 2020	1,750,000	1,195	06 Sep 2001	656,820	449	1,093,180
	The Tampines Trilliant #15-XX	11 Jun 2020	1,750,000	825	11 Apr 2012	1,219,000	575	531,000
	Bishan Loft #15-XX	05 Nov 2020	1,750,000	1,195	29 Aug 2001	620,930	424	1,129,070
5	Bishan Loft #23-XX	21 Jul 2020	1,720,000	1,229	30 Apr 2009	861,000	615	859,000

Source: Pinnacle Research, REALIS

The truth is that people who bought an EC when the project was first launched could already be sitting on profits as prices typically increase as sales gain momentum. For example, the median price for an EC at Rivercove Residences in Q2 2018 was $973 psf., but by Q1 2021 it had risen to $1,143 psf. with seven caveats having been lodged. Also, the median price for an EC at Hundred Palms Residences in Q3 2017 was $843 psf. But according to URA Realis caveats, just three years later in Q3 2020 a unit was sold there at a median price of $1,195 psf. Although the prices of new launch ECs have been higher in recent years, the resilient prices of private condos have been inching up as well. Since prices of new launch ECs are so low, the chances of making decent gains in the future once the EC is fully privatised are great. By then, prices of resale ECs will surely be substantiated by the prices of private condos in surrounding areas.

Cons: 

1. For 10 Years EC Owners Must Abide by HDB Rules

As discussed earlier, ECs are essentially HDB properties during the first 10 years, therefore you as an owner must comply with HDB rules. There is a 5-year MOP, which means you must reside in the condo for at least five years before you are allowed to rent it or sell it, but only to a Singapore citizen or Permanent Resident. Also, the MOP only starts after the development gets its Temporary Occupation Permit (TOP).

Aside from the MOP, you’ll need to abide by all of HDB’s other rules, which are the property ownership rule, income ceiling cap, resale levy rule, plus all of the eligibility conditions.

2. Executive Condos Are Primarily Located in the Outskirts

To keep the prices of ECs low, they’re located in areas where the land costs less, which is usually in the outskirts. These include places like Choa Chu Kang, Punggol, Sembawang, Sengkang, and Woodlands. This means that most ECs are not located near bus interchanges or MRT stations.

3. You Can Only Get Financing from a Bank

If you plan on buying an EC, you would not be eligible for an HDB loan. Therefore, you would need to borrow from a bank or another financial institution.

Banks have a loan-to-value ratio (LTV) that they follow when lending on property. So, the most you can borrow from a bank to finance your EC is 75% of the sale price or the property’s valuation (whichever is lower).

This leaves a down payment of at least 25% that you would need to pay yourself. Of this amount, 5% must be in cash, with the other 20% being paid with monies from CPF plus cash. Therefore, if you’re buying an EC priced at $1 million, you will be expected to come up with $50,000 at the very least in cash.

Furthermore, you’ll be faced with fluctuating interest rates when getting a home loan from a bank. However, that might benefit you at the moment since interest rates are now at record lows due to the COVID-19 pandemic.

Additionally, you’ll need to consider the Mortgage Servicing Ratio (MSR) and Total Debt Servicing Ratio (TDSR) restrictions. To comply with MSR, you are only allowed to spend 30% of your monthly income on your mortgage payment. When it comes to TDSR, the total amount you can use for debt repayments, like on your student loans, credit cards and car loans, cannot exceed 55% of what you bring in every month.

4. EC Launches Are Rare

When an EC launch takes place, people flock there to buy the available units. There is always high demand for ECs because there are very few launches taking place each year. For example, in 2019 Piermont Grand EC was launched after almost two years of no EC launches. In 2020 there were only two EC launches, OLA EC and Parc Canberra and there was a mad rush to buy those units as well.

So, although the competition will be stiff you can count on high demand in the face of little supply.

5. People Who Buy Resale ECs Do Not Qualify for a CPF Housing Grant

Unlike HDB flats on the resale market, resale ECs are considered private properties, which means buyers are not eligible for a CPF Housing Grant.

Now that you understand the pros and cons of buying/owning an EC, let’s look at the differences between ECs and private condos:

How Executive Condos & Private Condos Differ:

Here’s a quick table comparison between ECs and condos:

Housing Type	Executive condo	Private condo
Pricing	More expensive than HDB flats	More expensive than executive condos
Lease	99-year leasehold	99-year leasehold or freehold
Status	Public for the first 10 years	Private
Who can buy	Only SC + SC or SC + PR households	Anyone
Are singles eligible?	Yes, only if the single is at least 35 years old and buy with another single	Yes
Minimum Occupation Period (MOP)	Five years	Not applicable
Income ceiling	$16,000	No income ceiling
CPF Housing Grants Eligibility	Yes (first-timers only). Not applicable for resale unlike that of HDB resale	No
Selling / renting restrictions	Yes. Sell to SC & SPR after 5 years, and anyone after 5 more years. Rent only after MOP.	No
Location	Usually in outskirt locations that are not near MRT stations	Any
Launch frequency	Fewer, about 1 to 2 per year	More, usually over 20 per year

Step-by-Step Guide for Buying an EC in Singapore

Step #1:

Check to Make Sure You’re Eligible

Just like HDB properties, there are certain requirements that you must fulfil when you set out to purchase a brand new executive condo.

Summary of Eligibility Requirements

Nuclear Family	To qualify to buy an EC you must meet the requirements for one of these eligibility schemes: Public Scheme Fiancé/Fiancée Scheme Orphans Scheme Joint Singles Scheme
Citizenship	You must have Singapore Citizenship At least one of the other applicants must also be a Singapore Citizen (SC) or a Singapore Permanent Resident (SPR) All singles are required to be Singapore Citizens if their application is under the Joint Singles Scheme
Age	Must be at least 21 years of age Must be at least 35 years of age, if the application is under the Joint Singles Scheme
Income Ceiling	Your total household income must not be over the $16,000 ceiling.
Property Ownership	You are not the owner of any other property, locally or overseas, or have not gotten rid of any property within the last 30 months You have not purchased a new HDB/DBSS flat or EC, or been given a CPF Housing Grant before; or have bought just one of these properties/been given just one CPF Housing Grant so far

Nuclear Family

You are required use one of the eligibility schemes when buying, which are the Public Scheme, Fiancé/Fiancée Scheme, Orphans Scheme or Joint Singles Scheme as described below:

The Scheme	Who Qualifies
Public Scheme	You create a nuclear family with any of the following: your spouse, children, siblings, parents, or the children you have legal custody of (if you’re divorced or widowed)
Fiancé/Fiancée Scheme	You are purchasing with your future spouse
Orphans Scheme	You are purchasing with your siblings (all must be single and orphaned)
Joint Singles Scheme	You are purchasing with no more than three other co-applicants who are all SCs. Every applicant must be single, at least 35 years of age, and must be a co-applicant

Step #2:

Organize Your Finances

Once you know you’re eligible, it’s time to get your finances in order. This starts with getting your bank to give you an Approval-in-Principle (AIP) for a loan.

This is important because your AIP essentially determines the budget you’ll need to abide by when buying the property.

It also sets out the LTV amount based on your age, monthly income, loan duration and outstanding loans if any. As discussed earlier, the LTV amount for your first loan maxes out at 75% of the property’s valuation or sale price, whichever is lower. Your down payment would then be 25%, with at least 5% required to be in cash.

Don’t forget that buying a home involves a lot more than paying the purchase price because you’ll also be responsible for other fees, including tax. These can quickly add up when you figure in the legal fees, Buyer’s Stamp Duty (BSD), resale levy (if this would not be your first HDB purchase), and fire insurance. For further information, you may want to read Cost of Purchasing and Owning a Property in Singapore.

Also, you need to consider the government’s restrictions, which you are required to comply with, like the TDSR and MSR, which were discussed earlier.

If you intend to withdraw monies from your CPF Ordinary Account (CPF OA) to help pay for your EC, now would be the time to see how much you have in your account and how much you’re allowed to use, which is determined by the valuation limit.

Step #3:

Choose an EC Development

Once you’ve successfully navigated the first two steps, it’s time for some fun, choosing an EC that is within your budget. Two EC projects that you may want to look into would be Parc Central Residences and Provence Residence. We invite you to contact us if you’re interested in either one or both. For resale ECs, start by looking through the listings on PropertyGuru.com.sg and 99.co.

Once you find some resale ECs that interest you, it would be wise to hire a reputable real estate agent. An experienced agent will help speed up your search by narrowing down your choices, setting up viewings, voicing their opinions on each EC, pointing out the pros and cons, negotiating prices and ultimately closing the deal on the EC of your choice.

In addition, your agent will refer you to trusted professionals whose work they can vouch for. These include conveyancing lawyers, reputable mortgage bankers, and experienced renovation contractors. In most cases, buyer’s agents do not charge their clients because they receive a share of the commission paid to the seller’s agent, which means you benefit from their expertise at no cost to you.

For EC projects that have not launched yet, the developer will likely ask you to go online and register your interest. This in no way obligates you to buy, it just indicates that you’re interested. You can get a good feel for a project by visiting the showflat.

Step #4:

Submit an Online Application

Are you eyeing a specific EC project? If so, go online and submit an e-application as soon as they start accepting submissions. The developer will review your application to make sure you’re eligible. You will be given a ballot number with an appointment date for choosing the unit you prefer.

Step #5:

Reserve Your EC

On your appointment date, you will make an in-person visit to the showflat to choose your unit. If the unit you have your heart set on is no longer available, you do not have to proceed with the transaction.

But if you do decide to go ahead, you must give the developer a cheque to secure the OTP, including a cash payment for the 5% booking fee.

Next, you’ll be given a set of documents, which are Property Details Information (PDI) that include the site plan, floor plans, the project’s rules and regulations, plus the sale and purchase agreement (S&P). It’s important that you read all of this information and agree to all the terms. You will then be given a copy of the OTP. For more details, you may want to read Ultimate Guide to Purchasing Residential New Launches.

At this point, HDB will review your application, which could take as long as four weeks.

Remember to complete the CPF Withdrawal Form RPS/1A (Residential Properties Scheme) and mail it to CPF if you are planning to use monies from your CPF OA (or a CPF Housing Grant you qualify for).

Step #6:

Get Your Financing Lined Up, Obtain the Letter of Offer, and Engage a Conveyancing Lawyer

While waiting to receive HDB approval of your application, take this time to get your bank loan lined up, obtain the Letter of Offer (LO), and engage a reputable conveyancing lawyer.

It makes sense to get quotes from a variety of banks and compare the rates, so that you can choose the best home loan package. Check online at Pinnacle Mortgage for the lowest rates. Get your loan approved and have your banker issue the LO.

Note: Do not sign the LO without first having your application for the unit approved, otherwise your mortgage cancellation fees are at risk of being forfeited.

Step #7:

Sign the Sale and Purchase Agreement & Pay the Stamp Duties

Once your application has received HDB approval, you can expect to receive the S&P Agreement soon after. This is when you’ll exercise your option, which must be done within three weeks if you want to proceed with the purchase.

If you’re moving forward to buy the unit, this is when you’ll need to pay the rest of the down payment, along with the fee for exercising your option, which comes to 15%. This is payable when you sign the S&P or within nine weeks from signing the option, whichever comes later.

Finally, you must pay Stamp Duties within two weeks of signing the S&P. If you decide to back out at this point, you will forfeit 25% of the 5% Booking Fee, which is 1.5% of the sale price.

Step #8:

Wait for Completion of the EC, and Make the Payments When Due

After signing the S&P documents, it’s time to determine how you’re going to pay for your condo. When buying an EC, you have two options:

1. Normal Payment Scheme (NPS), or Progressive Payment Scheme (PPS)
2. Deferred Payment Scheme (DPS)

NPS is how buyers normally pay for their EC, which is determined by the property’s process of completion. This is how it works:

1. Pay cash for the 5% option fee
2. Sign the Sale & Purchase Agreement and pay the 15% remaining on the down payment (you can use CPF funds)
3. Pay Stamp Duties owed (you can use CPF funds)
4. Pay 10% after the foundation is completed (pay with your home loan)
5. Pay 10% after the framework of reinforced concrete is completed (pay with your home loan)
6. Pay 5% after the partition and walls are completed (pay with your home loan)
7. Pay 5% after the ceiling is finished (pay with your home loan)
8. Pay 5% upon completion of internal plumbing, plastering, electrical wiring, and door and window frames (pay with your home loan)
9. Pay 5% upon completion of the drains, carparks, and road (pay with your home loan)
10. Pay 25% once you get your TOP (pay with your home loan)
11. Pay 15% once you receive the Certificate of Statutory Completion (CSC) (pay with your home loan)

On the other hand, DPS proceeds very differently.

You are only required to make a 20% down payment, which consists of a 15% payment when signing the Sale and Purchase Agreement, plus a 5% option fee.

You can pay the 80% remaining once the development gets its TOP. However, there is a caveat, which is that you will be paying more for your EC.

The DPS option appeals to those who already have mortgage loans and would like additional time to repay their current mortgage (the LTV limit for second home loan is 45% or 25% depending on loan tenure such as if it is more than 30 years or extends past the borrower's age of 65).

Step #9:

Pick up Your Keys

At this point all you’re doing is waiting for EC to get its TOP, at which time you can take possession and start renovations.

Rules Regarding the Resale Levy for ECs

You would only be required to pay the resale levy if you had purchased a subsidised property in the past, whether it was an EC that you bought from a developer (if the land sale launch occurred on or after 9 December 2013) or a BTO flat.

Putting it simply, you must pay the resale levy when:

• Selling your subsidised flat, then purchasing another one from HDB
• Selling your subsidised flat, then purchasing an EC from a developer whose land sale launch occurred on or after 9 December 2013.

You are not required to pay the resale levy when:

• Buying a flat under the Design, Build & Sell Scheme (DBSS) from a developer
• Buying an Executive Condo (EC) from a developer whose land sale launch occurred before 9 December 2013
• Buying a private residential property
• Buying an HDB resale flat

The amount your resale levy could be all depends on the type of flat it is, but it could be as much as $55,000:

First Subsidised Flat	Amount of Resale Levy*
2-room flat	$15,000 for households and $7,500 for singles
3-room flat	$30,000 for households and $15,000 for singles
4-room flat	$40,000 for households and $20,000 for singles
5-room flat	$45,000 for households and $22,500 for singles
Executive flat	$50,000 for households and $22,500 for singles
Executive condo	$55,000 for households, does not apply for singles

*Note: The amount of the resale levy depends on the price the flat sold for, or it’s based on 90% of the flat’s market value, whichever is highest.

Can I Purchase a New EC Even Though I Already Own an HDB Flat?

Yes, but you are only allowed to have owned or currently own one of the following prior to applying:

• A flat purchased from HDB (i.e., BTO flat)
• A DBSS/EC purchased from a developer
• A Resale HDB flat purchased with a CPF Housing Grant (for first-time applicants only)

Singapore Citizens who are eligible can only buy the above types of properties a total of two times, and not two times per type of property. So, you are allowed to own an HDB flat while owning an EC, but you can’t own two HDB flats along with two ECs.

Therefore, if you’ve already purchased two such properties, you cannot apply to buy an EC, or have your name listed on an application as an essential occupier.

For a lot of Singaporeans, owning an EC allows them to enjoy the condo experience without having to stretch their budget beyond what they can comfortably afford.

Thinking about this long-term, some buyers feel peace of mind since they may have the chance to sell their unit in an en bloc sale down the road, and/or find themselves dealing with lease decay at some point in the future, giving them a chance to apply to top up their 99-year lease. 

If you are seriously considering buying an EC, you may want to know about some interesting new options, aside from Parc Canberra, Piermont Grand, and OLA. Last January, a new launch in Tampines took place called Parc Central Residences. About 60% of the 700 units have already been sold. Also, Parc Greenwich in Fernvale Lane and Provence Residences in Canberra Link are two that we can look forward to. Both are expected to attract a lot of interest, given the current state of few mass-market offerings this year.

Disclaimer: The information provided in this article does not constitute legal advice. We recommend that you get the specific legal advice you need from an experienced attorney prior to taking any legal action. While we try our best to make sure that the information provided on our website is accurate, you take a risk by relying on it.

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At Pinnacle Estate Agency, we strongly believe in sharing our real estate knowledge to the public.⁠ For more content like this article, check out our Singapore Property Guides.