Are Ecs Still Good Buy
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Retiree Mr Chong has been a supportive father to his three sons when they were setting up their homes. His eldest son bought a private condo while the younger brothers purchased executive condos (ECs). According to Mr Chong, buying an EC at a new launch is a smart decision. Even if you buy shortly after the five-year minimum occupation period (MOP), it is still a good entry price.
Mr Chong has first-hand experience with this scenario. His second son bought a three-bedroom unit at the 531-unit Hundred Palms Residences in July 2017. However, he wanted a four-bedroom unit which was sold out quickly. The project was launched by Hoi Hup Realty and received 2,000 e-applications. It was sold out on the first day of launch at an average price of $841 psf. The EC on Yio Chu Kang Road was completed in 2019. Based on caveats lodged in January and February 2025, the average price of units sold was $1,769 psf, translating to a 110% price gain in eight years.
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Mr Chong’s second son bought a 1,055 sq ft, three-bedroom unit at Hundred Palms for $1.95 million ($1,849 psf) in February. He estimates that his son’s EC unit has appreciated by about $1 million since its launch. This significant increase in capital gains has motivated many to upgrade to private housing, according to Mr Chong.
Three years ago, when Mr Chong’s youngest son decided to set up his own home, Chong sold his three-bedroom unit at The Interlace. It was their family home for ten years. In 2021, the Chongs bought a four-bedroom, dual-key resale unit at Twin Fountains. This 418-unit EC in Woodlands was launched in 2013 by a joint venture between Frasers Property and Lum Chang, and completed in 2016.
ECs are only open to Singapore citizen or permanent residents at launch, and after the five-year MOP, foreigners can buy ECs in the resale market only after ten years of obtaining Temporary Occupation Permit (TOP). The twin-key unit allows Chong privacy as he occupies the one-bedroom studio while his son and family occupy the three-bedroom apartment. The main entrance is shared, but each apartment has its own separate entrance.
Even though they paid $1,000 psf for the Twin Fountains unit in 2021, which was considered a new high at the time, recent resale prices are even higher, according to Mr Chong. Based on the latest transaction in February, a 1,206 sq ft, four-bedroom unit was sold for $1.62 million ($1,344 psf). Mr Chong notes that this reflects a 30% increase in resale prices compared to when they bought it.
Last October, City Developments launched Norwood Grand, a 348-unit private condo at Champions Way in Woodlands. About 84% of the units were sold during its launch weekend at an average price of $2,067 psf, setting a new benchmark for Woodlands. Mr Chong believes that this launch has been significant for the region, given the announcement of revitalisation and new infrastructure, including the Johor Bahru-Singapore Rapid Transit System with its Singapore terminus in Woodlands North.
However, the rising EC prices and caps on loan quantum mean that buyers will have to pay a higher upfront cost, according to Eugene Lim, key executive officer at ERA Singapore. The monthly household income ceiling for ECs is $16,000, and buyers must meet the Mortgage Servicing Ratio (MSR) of 30% and Total Debt Servicing Ratio (TDSR) of 55%. This means that buyers can only take a maximum loan amount of around $1 million for a 30-year tenure, assuming a 30-year-old EC buyer with a household income of $16,000.
Despite the higher upfront costs, Mr Lim believes that buyers are not deterred by the higher prices of ECs. This is because there is still a 42% median price gap between similar-sized homes in the EC market and 99-year leasehold private condos in the Outside Central Region (OCR). For instance, the median price of an EC unit sized at 900-1,000 sq ft is about $1.48 million, while a similar-sized unit in a private condo is about $2.1 million. Mr Lim believes that this presents value for buyers, especially HDB upgraders.
The affordability and lower price psf compared to private condos in the same area, along with the Deferred Payment Scheme, makes ECs a sustainable and desirable option for buyers, according to Christine Sun, OrangeTee Group chief researcher and strategist. She notes that the median price gap between new ECs and new private condos in the OCR has narrowed in recent years, with EC prices rising at a faster pace compared to non-landed home prices in the OCR.
However, the narrowing price gap does not deter buyers, as they do not need to dispose of their existing home before buying an EC. HDB upgraders also do not need to pay additional buyer’s stamp duty when purchasing a new EC. Mr Lim adds that buyers can also opt for the Deferred Payment Scheme, where they only pay a deposit, and their loan is deferred until after the completion of the EC. This means that buyers do not have to service two mortgages while waiting for their new home to be completed.
Despite three new EC launches expected this year, Mr Lim believes that the strategic spacing across different locations will cater to the housing needs of Singaporeans across the island.