ECs are a cross between private housing and public housing and offer state-subsidized housing. Many home buyers are attracted to ECs because of their affordability and value for money. Here are some things to consider when purchasing an EC: Read on to learn about the advantages and disadvantages of an EC, and how you can make the most of your investment.
ECs are a value buy
If you are looking for an investment property, you may want to consider ECs. These are condos with low starting prices that can be sold at a higher price once the development reaches its 11th year. They can be sold to a wider pool of potential buyers when their initial price falls below the interest rate floor. Most ECs are priced below the median price of privately-marketed private condominiums, making them a good value buy for property buyers.
As these units are cheaper than HDB flats, many Singaporeans prefer to invest in ECs. Furthermore, they do not have to pay additional buyer’s stamp duty. Some buyers choose to sell their ECs at a higher price or top up the 99-year lease instead. Nevertheless, you should know the benefits and disadvantages of purchasing an EC before making a decision.
They are a cross between public and private housing
While ECs typically have lower selling prices, they also tend to have higher capital appreciation potential. According to a Squarefoot research study, the gap narrows after five years. Another key difference between an EC and a private condominium is location. Most ECs are located away from the city and MRT stations, making them a more practical choice for buyers on a budget.
The government provides a subsidy to new Executive Condominium buyers who meet the minimum occupancy period. In addition, there is a mortgage servicing ratio (MSR) cap that prevents buyers from being in a risky financial situation. Currently, MSR caps are set at 30 percent of gross monthly income. As an alternative to private condos, executive condominiums offer the same physical features as private condominiums but come with fewer restrictions.
They are state-subsidized
State-subsidized executive condominiums are making their way to the public. These properties are priced slightly below those of ordinary condos but come with many benefits that aren’t available in normal condos. These include fully-equipped kitchens, similar finishings to private condos, and the ability to benefit from CPF Housing Grants. Additionally, these properties are eligible for foreign buyers, who are permitted to buy them from their 11th year onwards.
While State-subsidized Executive Condominiums aren’t exactly the hottest property in town, the fact that they are sold by developers with government backing makes them a bargain. They provide homeowners with a luxurious lifestyle without the high price tag. The only catch is that they have to be lived in for a minimum of five years. This means that if you’re unsure Champions Way Condo of how much time you’ll need to stay in your new residence, you won’t be able to resale it.
They are a good bargain
Unlike other types of properties, executive condominiums target a different audience, the middle class local families with no children. Moreover, they can serve as home offices as well. Plus, they offer wonderful in-house facilities and great design. Despite the low price tag, they have a high demand among property buyers.
Newly launched executive condominiums are a good investment option if you’re looking for an affordable condominium lifestyle. They can help you generate good profits while renting out as well. Depending on the point of entry, ROI could take up to 8 years to realize. Those who’d prefer a shorter holding period might be better off with resale condos or older launches.
Executive condominiums were first introduced in 1999 and were originally sold to the sandwich class of Singaporeans. However, the government subsidized these properties, and now they can be sold to Singaporeans or foreigners. As such, these properties have more buyers than private ones.
They face stiff competition
New launches are on the way. The second half of next year will see 10 new launches, including condos, executive condominiums, and en bloc properties. Besides the Liang Court development, which is currently under construction, there will also be the upcoming Parc Central Residences and Provence Residence.
New EC launches are popular among “sandwich class” buyers, as these buyers’ income levels are not sufficient to qualify for private condos but are too low for HDBs. As a result, ECs are designed to attract this type of buyer. These first-time buyers can buy the units at a lower price and enjoy increased profit potential upon selling.