When is a Good Time to Sell Your Executive Condominium Unit?

(Photo: Lum Chang)

Over the last few months, you may have seen various headlines highlighting the profits that EC transactions have achieved. You may be wondering, could you sell your unit at a good profit too?

Your property may be reaching the end of the MOP or perhaps it is within the 5- and 10-year marks and you are wondering if you should wait till the 10th year before you sell the unit. In this post, we will analyze the historical profitability of various developments and highlight key things that EC owners and prospective owners should look out for.

1. What is an EC and who is it targeted at?

Introduced in 1997, EC is a hybrid form of property that is offered by the government to cater to the aspirations of Singaporeans, especially young graduates and professionals who are looking to live in private properties.

Private property developers bid for land that is set aside for EC developments via the Government Land Sales (“GLS”) programme and subsequently sell the units directly to eligible Singaporean households. For more information on the eligibility conditions and CPF grants available, click here.

2. Where are ECs in Singapore located?

ECs are mainly found in the heartland neighbourhoods such as Pasir Ris, Tampines, Seng Kang, Punggol, Yishun, Woodlands, Choa Chu Kang and Woodlands.

Scroll to the end for a complete map of all the ECs in Singapore, categorized by TOP year.

3. Who can I sell my EC to?

EC owners are required to fulfill the Minimum Occupation Period of 5 years. During the MOP, EC owners are not allowed to rent out the entire flat or purchase another property.

Selling your EC after 5 or 10 years:

4. What properties can I buy after selling my EC? Do I have to pay resale levy?

Do note that there are certain conditions to be met for EC owners looking to purchase an HDB flat:

Wait-out period

Resale Levy

5. Is it better to sell at 5-year mark or 10-year mark?

Many homeowners often have these questions when they hit the 5-year MOP mark:

“Should we sell now or wait for the price to increase further at the 10-year mark?” “Will the prices increase more after the 10-year mark?” “Maybe I should rent the unit out first then sell after full privatisation?”

To answer these questions, let’s examine the historical transaction prices of the several ECs that have achieved full privatisation. D19 – Hougang, Punggol, Seng Kang, Serangoon Garden

D23 – Choa Chu Kang, Bukit Batok, Dairy Farm, Hillview, Bukit Panjang

D18 – Simei, Tampines, Pasir Ris

While the transaction prices of ECs have a healthy growth after the MOP, the same cannot be said for the period after full privatisation. The key difference after 10 years is this: You can sell your EC unit to foreigners, or a company. However, is there a high demand for ECs from foreigners? Let’s take a look at the buyer profile by status.

Source: EdgeProp

Lack of demand from foreigners

Save for The Rivervale where foreigners account for 2.2% of the owners, foreign ownership in the remaining ECs only accounts for <1% of the owners. This could explain why prices generally do not experience exceptionally strong growth even after the 10-year mark as Singaporeans and PRs generally form the main pool of buyers.

This could be due to the fact that most ECs are in heartland areas away from the CBD and therefore may not be as popular among foreigners.

Increase in ABSD

The government had also increased the Additional Buyer’s Stamp Duty (ABSD) earlier in April 2023. The ABSD rate for foreigners purchasing any residential property was increased from 30% to 60%. With such a hefty stamp duty to be paid, foreigners might think twice and opt for rental instead.

6. Are HDB upgraders buying ECs? Why is that so?

More affordable than private condos

ECs have increasingly become more popular amongst HDB upgraders due to its affordability, offering an accessible option for buyers to enter the private market. New ECs are usually priced lower than its private condominium (all mentions of “condo” in this article refer to private condominiums) counterparts due to housing subsidies provided by the government. As such, first owners would be able to profit from the sale even if their units were marketed at a lower price as compared to condos in the vicinity.

Let’s take a look at the projects surrounding Buangkok MRT:

Note: Data based on transactions in the last 6 months Source: URA, Squarefoot as at 24 Aug 23 The Quartz was the first private condominium to be built in this area, followed by Esparina Residences and Jewel@Buangkok, two developments that are side by side, opposite Buangkok MRT. The average transaction price for Esparina Residences is at $1,500 psf while Jewel@Buangkok is at $1,611 psf. We also note that Sengkang Grand Residences, which is a condo that will TOP this year, is transacting at an average of $1,993 psf. For an HDB upgrader who is looking for an affordable condo that is relatively new (less than 10 years), they would most likely opt for Esparina Residences.

For investors who are looking to rent out their unit for rental income, they are more likely to choose the most affordable option to maximise their rental yield.

Larger living spaces

Aside from affordability, ECs generally have larger living spaces as compared to condos:

For larger families where ample living space is a priority, they would most likely select the EC layout.

In conclusion

ECs will likely remain a popular choice among homebuyers unless the price gap with private condos starts to narrow. However, we do not expect prices to jump after the 10-year mark due to the reasons we have shared in this article.

Of course, the growth of a project very much depends on factors such as timing, location, layout, as well as the supply and demand of the area.

Other than some of the key factors that we have highlighted above, there could be many considerations for you and your family when it comes to selling your EC (e.g. your age, proximity to your children’s school, financing requirements, etc.) Do make sure you have your next steps planned out before making your move. Feel free to speak to us, it’s free anyway 😉

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Complete map of ECs in Singapore

^ Certificate of Statutory Completion * Received phased TOP:

La Casa

Phase 1 TOP, 22 Feb 2008: Blocks 50, 52, 54, 56, and 58

Phase 2 TOP, 25 Apr 2008: Blocks 60, 62, 64, 66, and 68

Whitewater

Phase 1 TOP, 31 Jan 2005: Blocks 27, 29, 31, and 33

Phase 2 TOP, 1 Mar 2005: Blocks 21, 23, and 25

The Florida

Phase 1 TOP, 18 Feb 2000: Blocks 70 and 78

Phase 2 TOP, 30 May 2000: Blocks 72 and 76

Sol Acres

Phase 1 TOP

12 Mar 2018: Blocks 8, 16, 20, and 24

26 Apr 2018: Blocks 2, 6, and 14

Phase 2 TOP

12 Mar 2018: Blocks 18, 22, and 26

26 Apr 2018: Blocks 4, 10, and 12