When 1^st Time Buyers Should Choose Private Condo over Executive Condo (4 Situations)

Executive condo (EC) is a public-private housing that is popular among middle-income Singaporeans. EC has many attractive features and also very strict buying restrictions: Singles, Permanent Residents (PR) and High-Income earners will not qualify. This article will attempt to list 4 situations when qualified 1^st time buyers should choose private condo over executive condo

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     Table of Content

• You Prefer a Shorter Holding Period
• You Want More Rental Flexibility
• To Avoid Locking Down 2 Names 
• More Choices with Better Capital Appreciation

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 📌1. You Prefer a Shorter Holding Period

• An EC takes 5 years to build and complete
• You can sell to PR after completing the 5 years Minimum Occupation Period (MOP).
• Foreigners can buy an EC when it becomes fully privatized after 10 years.
• The whole process takes about 15 years.
• Many EC buyers are HDB upgraders or owner occupiers who are ready to hold long term.
• If you prefer a shorter holding period, you should choose to buy a private condo instead.
• For private condo, you can sell after 3 years without seller stamp duty (SSD).
• SSD is calculated from the day your sign your Sales & Purchase (S&P) agreement, not Move-In Date.
• This applies to both new launch and resale condos

📌2. You Want More Rental Flexibility

• When buying EC, you can only take bank loans, same when buying a private condo.
• If you know that you are unlikely to stay in the EC for the next entire 5 years, it may be better to buy a private condo.
• For example, you can rent out your private condo anytime and use the rent to cover your bank mortgage.
• Renting out whole EC unit is not allowed within the 5 years MOP

📌3. To Avoid Locking Down 2 Names

• You need to form a family nucleus (e.g., couple) to buy an EC
• You cannot decouple before fulfilling the 5 years MOP.
• This means that 2 names will be locked down for 10 years (construction time + MOP)
• For couples who aspire to own 2 private properties earlier, then an EC may not be suitable

📌4. More Choices with Better Capital Appreciation

• There will only be 4 EC launches in 2022.
• EC is relatively cheaper than a private condo but they are usually in remote locations.
• Buyers who choose private condo will have more options.
• Selected condos that are nearer to MRT stations, popular schools or in prime city fringe locations may have better capital appreciation potential than EC.

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