{"id":50271,"date":"2022-04-04T17:52:21","date_gmt":"2022-04-04T09:52:21","guid":{"rendered":"https:\/\/www.99.co\/singapore\/insider\/?p=50271"},"modified":"2022-06-13T18:10:55","modified_gmt":"2022-06-13T10:10:55","slug":"buy-ec-more-attractive-post-cooling-measures","status":"publish","type":"post","link":"https:\/\/www.99.co\/singapore\/insider\/buy-ec-more-attractive-post-cooling-measures\/","title":{"rendered":"Why it\u2019s more attractive to buy an EC post cooling measures"},"content":{"rendered":"
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For most of us, upgrading to a condo is the ultimate property goal. However, given the cooling measures announced last December<\/a>, many may find that doing so may not be as financially viable.<\/p>\n

Measures announced include raising the Additional Buyer\u2019s Stamp Duty (ABSD)<\/a> for Singaporeans buying a second property from 12% to 17%. The Total Debt Servicing Ratio (TDSR)<\/a> has also been lowered from 60% to 55%.<\/p>\n

Still, this doesn\u2019t mean all hope of achieving that dream is gone. A good option is to go for an Executive Condominium (EC)<\/a>.<\/p>\n

The thing about ECs is that they\u2019re designed for the sandwiched class. It\u2019s not just for those who bust the BTO income ceiling, but also for those who want to upgrade from an HDB flat, but find that buying a condo is too expensive.<\/p>\n

ECs are a public-private hybrid housing. They\u2019re built by private developers and come with condo facilities, allowing residents to enjoy condo living at a fraction of the cost. This is because new ECs are subsidised by HDB. Grants are also available for those who are eligible.<\/p>\n

\"Artist's<\/a>
Artist’s impression of North Gaia’s function room and pool.<\/figcaption><\/figure>\n

On the other hand, they\u2019re generally located in the suburbs<\/a> (and generally far from the MRT). Other caveats include meeting certain HDB requirements, such as a five-year MOP and a limited pool of buyers when they are allowed to be resold five years later.<\/p>\n

But once they\u2019re privatised 10 years after the TOP, they\u2019re no longer subjected to these HDB requirements. They can also be sold to foreigners, as they\u2019re considered condos.<\/p>\n

And with the recent cooling measures, we think ECs are becoming a more attractive option to consider these days.<\/p>\n

No ABSD to be paid upfront<\/h2>\n

Just like owning an HDB flat, when it comes to buying a new EC, you\u2019re not allowed to own any other properties. You\u2019ll have to dispose of it at least 30 months before you can buy a new EC.<\/p>\n

But if your current property is an HDB flat or EC bought from a developer, you don\u2019t have to dispose of it before buying a new EC<\/a>. Even though this means that you own two properties, you won\u2019t be subjected to ABSD. So if you\u2019re buying a S$1 million EC, you can save S$170,000 in ABSD.<\/p>\n

Just like buying another HDB flat, the ABSD remission will be automatic<\/a> upon HDB\u2019s approval of the EC purchase.<\/p>\n

Take note that you\u2019ll still have to dispose of your flat within six months<\/a> after collecting the keys to your new EC.<\/p>\n

Technically, you can still get this ABSD remission<\/a> if you\u2019re selling your flat within six months to upgrade to a condo. But this option can be more of a hassle and financially-draining, as you have to pay the ABSD upfront first, before applying for the remission to get the money back later. And with the higher ABSD rate, you\u2019ll have to fork out more money for it.<\/p>\n

However, by buying an EC instead, you don\u2019t have to deal with the ABSD at all, saving you some cash and CPF savings.<\/p>\n

Lower supply available<\/h2>\n

There are not a lot of new ECs available right now. As of Q4 2021, there are only 1,985 unsold units in the pipeline<\/a>.<\/p>\n

Currently, the new launch ECs are:<\/p>\n