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

Private Condo over Executive Condo

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 1st 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
condo over executive condo

📌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
condo over executive condo

📌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
condo over executive condo

📌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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Dennis Lim

Dennis has more than a decade of experience investing in real estate. Like many fellow Singaporeans, he grew up in a HDB flat with dreams to live in a condominium. Through careful financial planning & hardwork, this became a reality when he was 30. He now owns 3 private properties in Singapore and has helped hundreds of Singaporeans to achieve their goal of upgrading their homes in land-scarce Singapore.

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