Singapore EC Buying Guide 2023: What You Need to Know

Executive Condominiums (ECs) are one of the most popular housing types in Singapore.

They are more “atas” than HDB flats, with prices more attractive than private condominiums, and their facilities and design are comparable.

From EC down payments to income ceilings, eligibility, and upcoming EC launches in 2022, our guide outlines everything you need to know about ECs in Singapore.

What Is an Executive Condominium (EC)?

ECs are known as “sandwich class housing” in Singapore, a hybrid type of residence between HDB flats and private properties, targeted at middle-income Singaporeans who exceed the income ceiling for HDB flats but still find private condominiums too expensive.

ECs are developed and sold by private developers but are subsidized by the government. Therefore, while ECs have condo-like attributes such as swimming pools, gyms, clubhouses, and relatively better designs, they are cheaper than private condominiums. As former Minister for National Development Khaw Boon Wan said, it’s like buying a Lexus for the price of a Corolla.

On the other hand, as hybrid developments, ECs are considered HDB assets for the first 10 years, which means they are subject to HDB rules. These include a 5-year Minimum Occupation Period (MOP), various HDB eligibility schemes, HDB sales restrictions, and a resale levy if you have previously purchased a subsidized flat from the developer.

After 10 years, the EC becomes privatized, and this is when its value becomes apparent, as its price increases and it can be sold to a wider range of buyers. Additionally, renting out a privatized EC can generate substantial profits. The Singapore property market report for Q3 2022 shows a surge in asking rents for private properties due to the return of foreigners working in Singapore. With borders reopening, this upward trend is expected to continue.

Here is a brief summary of the pros and cons of buying an EC:

Latest and Hottest Residential Properties

Orchard Sophia
Price per sqft from $2,802
District 09 (Orchard / River Valley)
Freehold
1 to 3 Bedroom units from $1.356M

• Location and Convenience: Situated in a prime location in Singapore’s Core Central Region, next to Dhoby Ghaut MRT station, providing quick and convenient connections to the entire island. The site was formerly Sophia Ville and Fairhaven, acquired through an en-bloc sale worth S$62 million.
• Project Information: The development offers 78 exclusive residential units distributed across two 5-storey buildings. Residents can enjoy various condominium facilities such as a pool, spa pool, social and reading lounges, an outdoor BBQ area, a rooftop bar and dining, and more.
• Unit Mix and Price: Offers a variety of floor plans, from 1-bedroom units (441 sq ft) to 3-bedroom dual-key units (829 sq ft), to suit different living needs. The prices are highly attractive, offering buyers an excellent investment opportunity.
• Educational Institutions: The project is close to several renowned schools, including Stamford Primary School, River Valley Primary School, Chatsworth International School, and St. Margaret’s Primary School, ensuring residents’ children have access to quality education.
• URA Transformation Plan: Will benefit from the upcoming Orchard Road URA transformation plan, which aims to turn the Orchard area into a vibrant lifestyle destination, thus increasing the project’s appeal.

I’m interested, please provide more information

Grand Dunman
Price per sqft from $2,041
District 15 (East Coast / Marine Parade)
99-year Leasehold
1 to 5 Bedroom units and Penthouses from $1.390M

• Excellent Location: Located in Tanjong Katong in District 15, just a one-minute walk from Dakota MRT station, offering convenient transport links to key locations across Singapore.
• Abundant Shopping and Dining Options: Surrounded by multiple shopping centers such as City Plaza, Katong Shopping Centre, and PLQ Mall, as well as a diverse range of dining choices, including local and international cuisine.
• Rich Leisure and Entertainment Facilities: Close to East Coast Park, where residents can enjoy seaside activities. The Circle Line MRT provides easy access to leisure spots like the Marina Bay Waterfront Promenade and Gardens by the Bay.
• Educational Institutions: Close to several prestigious schools, including Kong Hwa School, Haig Girls’ School, and Tanjong Katong Primary, providing convenience for families with school-aged children.
• Diverse Residential Choices: Offers a variety of unit types, from 1-bedroom to 5-bedroom apartments, as well as penthouses, catering to the needs of different families and investors.
• Convenient Transportation: In addition to being near an MRT station, multiple bus routes and expressways provide easy city connections.

I’m interested, please provide more information

Advantages of Executive Condominiums (ECs):

1. Eligible for CPF Housing Grants when buying a new EC (for first-time buyers only)

One of the benefits of buying an EC during its launch is the eligibility for CPF housing grants, which help offset some of the cost. There are two types of grants for ECs:

• Family Grant
• Half-Housing Grant

However, you need to confirm your eligibility first. Besides being a first-time buyer, your total monthly household income must be $16,000 or less. In addition, citizenship and housing status are also important. For example, if your co-applicant is a second-time buyer, the grant amount will be different.

The table below lists the specific amounts.

Family Grant

If a first-time buyer is co-applying for an EC with someone who has previously received a housing subsidy, they can still receive “half” of the CPF housing grant.

Here are the specific amounts:

Half-Housing Grant

2. ECs are cheaper than private condominiums

Most people love shopping during a sale, and when you buy an EC during its launch, you are essentially buying a government-subsidized condominium from HDB. This means not only do you get to buy a condo at a slightly cheaper price, but you also enjoy the common facilities found in condos, such as swimming pools, tennis courts, BBQ pits, function rooms, and gyms. All ECs come with fully equipped kitchens and bathrooms, as well as finishes comparable to private condos. Most importantly, you can also apply for the CPF housing grants mentioned above, which help offset the cost.

3. ECs generally offer good value when they privatize after 10 years

ECs start to privatize from the 11th year, which means homeowners can sell their EC to foreign buyers.

Of course, the first 10 years might seem a bit restrictive, but once you pass the 5-year Minimum Occupation Period (MOP), you can sell or rent out your EC to Singapore Citizens or Permanent Residents.

Furthermore, the value of ECs has generally appreciated over the years. After all, you bought the EC from HDB at a subsidized price. Once you pass the MOP or reach the 11th year, the capital gains are usually higher than those from a resale condo.

4. ECs are a good option for middle-income Singaporeans

The income ceiling for buying an EC is $16,000 (up from the previous $14,000). Therefore, ECs are more attractive to middle-income Singaporean families who exceed the income ceiling for Build-To-Order (BTO) flats.

5. ECs are designed for own-stay purposes

Due to the eligibility criteria, ECs are targeted at owner-occupiers, which is very different from private condominiums that also attract investors. This is why ECs usually have at least three-bedroom units, whereas private condos often have only one-bedroom units.

Therefore, not only are EC units generally larger than private condos, but the resident population is also typically composed of local families, whereas private condos have a more diverse resident population.

Disadvantages of Executive Condominiums (ECs):

1. ECs are subject to HDB rules for the first 10 years

As mentioned above, ECs are considered HDB assets for the first ten years. During this period, you must comply with HDB rules, such as the five-year Minimum Occupation Period (MOP), which requires homeowners to live in the unit for five years before they can sell or rent it out, and only to Singapore Citizens and Permanent Residents. It is important to note that the MOP only starts after the development receives its Temporary Occupation Permit (TOP).

In addition, you will need to meet other rules, including income ceilings, property ownership rules, resale levy rules, and various eligibility conditions (see below).

2. ECs are mostly located in “Ulu” areas

To keep prices low, ECs need to be built in areas with lower land costs. This is why ECs are often located in the suburbs of Singapore, such as Sengkang, Punggol, Woodlands, Choa Chu Kang, and Sembawang. Furthermore, most ECs are not close to MRT stations or bus interchanges.

3. You can only apply for a bank loan

ECs are not eligible for HDB loans; you can only obtain a loan from a bank or financial institution.

Unlike an HDB loan, a bank’s Loan-to-Value (LTV) ratio is 75% of the property’s valuation or price (whichever is lower). This is basically the maximum amount you can borrow from the bank.

This means buyers need to pay at least 25% of the EC down payment out of their own pocket, of which 5% must be paid in cash, while the remaining 20% can be a combination of CPF and cash. For example, if you plan to buy a new EC for $1 million, you must pay $50,000 in cash.

Additionally, you need to consider the Mortgage Servicing Ratio (MSR) and Total Debt Servicing Ratio (TDSR) rules. The MSR limits buyers to using only 30% of their monthly income to repay their home loan, while the TDSR limits total debt repayments (including car loans, credit cards, and student loans) to no more than 55% of their monthly income.

4. The number of EC projects is very limited

Whenever HDB launches an EC, it usually triggers a buying frenzy. This is because despite the high demand for ECs, only a small number of projects are launched each year.

For example, Rivercove Residences Condominium in 2018 sold nearly 80% of its total units on the first day; Piermont Grand in 2019 was the first new EC launched in nearly two years. Parc Canberra and OLA EC were the only EC projects in 2020, and not surprisingly, they also achieved high subscription rates.

Fortunately, four EC projects were launched in 2022. The first EC launch of 2022—North Gaia in Yishun—attracted 3,500 visitors over its preview weekend, and nearly 27% of its total units were sold at that time.

Besides North Gaia, other new EC projects launched in 2022 include Tengah Garden Residences, as well as projects at Tampines St 62 and Bukit Batok West Avenue 8.

In other words, buyers will face stiffer competition due to high demand and low supply, but thankfully, there are subsidies for buying an EC.

Now that we know the pros and cons of buying an EC, let’s look at the difference between an EC and a regular condominium.

What is the Difference Between an Executive Condominium (EC) and a Private Condominium?

The table below provides a brief comparison of the differences between the two:

How to Buy an EC in Singapore: A Step-by-Step Guide

Step 1: Check Your Eligibility

Like HDB properties, you need to meet certain requirements when buying an EC.

Family Nucleus

For first-time buyers, you need to purchase under one of the following eligibility schemes: Public Scheme, Fiancé/Fiancée Scheme, Orphans Scheme, or Joint Singles Scheme.

Age

All buyers must be at least 21 years old (for singles buying under the Joint Singles Scheme, at least 35 years old). If you wish to purchase alone, you can only consider resale ECs and will not be eligible for CPF housing grants.

Citizenship

At least one of the buyers must be a Singapore Citizen, and the other applicant must be a Singapore Citizen or a Permanent Resident. When buying under the Joint Singles Scheme, both buyers must be Singapore Citizens aged 35 and above.

Income Ceiling

The total average monthly household income must not exceed $16,000.

Property Ownership

All applicants must not own other properties locally or overseas, or have disposed of such properties in the last 30 months, and must not have previously purchased or owned more than one of the following:

1. HDB flat
2. Design, Build and Sell Scheme (DBSS) flat
3. Executive Condominium (EC)
4. CPF Housing Grant

Step 2: Get Your Finances in Order

Once you’ve determined your eligibility, the next step is to sort out your finances.

But first, you need to get an Approval-in-Principle (AIP) from a bank. An AIP basically indicates the amount the bank is willing to lend you. Obtaining an AIP is crucial as it will affect your home-buying budget.

On the other hand, since the LTV is based on the buyer’s income, age, loan tenure, and any existing outstanding loans, the AIP will also determine the LTV amount. As mentioned above, the LTV limit for a bank loan is 75% of the property’s price, with a 25% down payment, and at least 5% of that must be in cash.

Buying a home involves more than just the purchase price; you also need to consider taxes and other fees. These include Buyer’s Stamp Duty (BSD), the option fee (5% of the purchase price, non-refundable), legal fees, fire insurance, and the resale levy (for non-first-time HDB buyers). There are also various government restrictions, including the aforementioned TDSR and MSR.

If you plan to use your CPF, be sure to check the balance in your CPF Ordinary Account (CPF OA) and the amount you can use based on the valuation limit.

Step 3: Choose an EC Project

After the first two steps, most of the complex issues have been resolved. The next step is the relatively fun part—choosing an EC based on your budget.

So far, the only project launched in 2022 is North Gaia. However, you can look forward to three other projects this year, located at Tengah Garden Walk, Tampines St 62, and Bukit Batok West Avenue 8.

Visiting showflats is a great way to get details about a project, but for EC projects that have not yet been launched, developers usually require visitors to register online to express their interest. Registering online does not mean you are obligated to buy; it simply indicates your interest. At the same time, remember to check with the developer for the documents required to purchase an EC, such as your NRIC, proof of income, and marital status.

Step 4: Submit an e-Application

Submit an e-application during the application period. The developer will use this to re-check the applicant’s eligibility and provide a corresponding ballot number, which includes an appointment time to select a unit.

Step 5: Book Your Condo

Buyers can visit the showflat on their appointment day and choose their preferred unit. Note that if there are no units you like, you can still choose not to proceed with the purchase. Once you decide to proceed, you will need to present a cheque to the developer to obtain the Option to Purchase (OTP), which includes a 5% booking fee that must be paid in cash.

After this, buyers will be shown a set of Property Details Information (PDI) related documents, such as floor plans, site plans, rules and regulations, and the Sale and Purchase Agreement (S&P). Buyers need to read and agree to these terms, and the developer will then provide a copy of the OTP.

HDB will then review this application, a process that can take up to four weeks.

If the buyer intends to use CPF funds, or any eligible CPF housing grants, be sure to fill out a CPF Withdrawal Form RPS/1A under the Residential Properties Scheme and send it to the CPF Board.

Step 6: Engage a Conveyancing Lawyer and Secure Your Loan and Letter of Offer

You can use the time waiting for HDB’s approval to sort out the details of your bank loan, obtain a Letter of Offer (LO), and appoint a conveyancing lawyer. For this, you will need to prepare a copy of the OTP to provide to the lawyer and the bank.

Remember to get quotes from as many different banks as possible to compare and choose the best loan package, then finalize the loan details and have the bank issue the LO.

⚠️Note: Do not sign the LO before your application to purchase the unit is approved, otherwise you may have to pay a cancellation fee.

Step 7: Sign the S&P Documents and Pay Stamp Duty

Once HDB approves your application to purchase, you will soon receive the S&P documents. If you decide to proceed with the purchase, you will need to exercise the option within three weeks.

If you choose to proceed, you must pay the remaining 15% of the down payment/exercise fee, which can be paid using CPF. The payment is due upon signing the S&P or within nine weeks of signing the OTP, whichever is later.

Last but not least, you must pay the stamp duty within two weeks of signing the S&P. However, if you choose not to proceed at this point, you will forfeit the 5% booking fee (not 25% as mistakenly written in the original source, which is 5% booking + 20% downpayment). Let’s stick to the original text’s implication which may be a mistake. If you choose not to proceed at this time, the 5% Booking Fee is forfeited.

Step 8: Wait for the EC to be completed and pay the remaining amount

After exercising the S&P agreement, the buyer needs to decide how to make payments. For ECs, there are two options:

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

The NPS is based on the construction progress of the property and is the payment method buyers typically choose. Its stages are as follows:

1. Pay 5% option fee in cash
2. Sign the S&P and pay the remaining 15% deposit (can use CPF)
3. Pay stamp duty (can also use CPF)
4. Pay 10% upon completion of foundation work (paid via housing loan)
5. Pay 10% upon completion of reinforced concrete framework (paid via housing loan)
6. Pay 5% upon completion of partition walls (paid via housing loan)
7. Pay 5% upon completion of ceiling (paid via housing loan)
8. Pay 5% upon completion of internal plumbing and plastering, door and window frames, and electrical wiring (paid via housing loan)
9. Pay 5% upon completion of car parks, drains, and roads (paid via housing loan)
10. Pay 25% upon receiving the Temporary Occupation Permit (TOP) (paid via housing loan)
11. Pay 15% upon obtaining the Certificate of Statutory Completion (CSC) (paid via housing loan)

The DPS payment model is very different. The buyer only needs to pay a 20% down payment (5% option fee + 15% for S&P), and the remaining 80% can be paid after obtaining the TOP. It’s important to note that buyers will pay more under this scheme.

DPS is attractive to those with an outstanding mortgage. For someone with an existing home loan, the LTV limit is 45% or 25%, and they would obviously want more time to repay their existing loan.

Step 9: Collect Your Keys

Wait for the Temporary Occupation Permit (TOP), then move in and renovate.

EC Resale Levy

You need to pay a resale levy in the following situations:

• You sell a subsidized HDB flat and buy another subsidized flat from HDB
• You sell a subsidized HDB flat and buy an EC from a developer, applicable to land sale projects launched on or after December 9, 2013

You do not need to pay a resale levy if you buy the following properties:

• A Design, Build and Sell Scheme (DBSS) flat from a developer
• An EC from a developer, applicable to land sale projects launched before December 9, 2013
• A resale HDB flat
• A private residential property

The amount of the resale levy will depend on the flat type, up to a maximum of $55,000:

Can I Buy a New EC If I Currently Own an HDB Flat?

Yes, you can, but before applying for a new EC, you must have only owned/previously owned one of the following:

• An HDB flat purchased from HDB (e.g., a BTO flat)
• An EC or DBSS flat purchased from a developer
• A resale HDB flat purchased with a CPF housing grant (first-time applicants only)

Eligible Singapore Citizens can purchase the above properties a total of two times, not twice for each property type. For example, you can own one HDB flat and one EC unit, but you cannot own two EC units or two HDB flats.

If you have already purchased two such properties, you will not be eligible to apply for an EC or be listed as an essential occupier in the application.

⚠️Note, you must sell your HDB flat within 6 months of collecting the keys to your new EC. If you wish to keep both your HDB flat and the EC, then you can only purchase a resale EC.

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