It’s obvious that Singaporeans are still enormously status-conscious regarding the public-private housing divide. And this is possibly why the Rivercove Residences Executive Condominium (EC) came into existence. This is a public-private hybrid property type. It allows homebuyers make the most of CPF Housing Grants while at the same time enjoying condo services. ECs also fulfill the desires of Singaporeans who may otherwise have traded their flats and moved up the ladder to private property as soon as they could afford it.
The biggest pull for ECs is definitely the fact that while they are initially HDB property, in 10 years’ time they can be formally recognized as private property.
Apart from the bragging rights you’d get for finally being a private property owner, your flat could end up being a better investment, as you’d no longer be under the control of HDB limitations on selling. You can now sell your flats to PRs and foreigners, and buys won’t be bound by HDB rules on who can or who can’t buy.
In contrast, one disadvantage is that potential buyers will not be able to access CPF Housing Grants once the EC becomes private property, which could, perhaps, negatively impact your sale.
Considerations for Buying Executive Condominiums
Now, in order to experience the benefits of owning an executive condominium, here are the following factors that you should take into consideration:
1. Lesser amount of money to pay
Rest assured that you are still eligible for the CPF housing grants even if you have a low income. But it doesn’t necessarily mean that you can’t afford the EC anymore because you still can. Most of the Singaporean applicants that apply as a couple have over $30,000 CPF grants assuming that their income each is $12,000 or below. The EC’s price is lower compared to any full-fledged condo units but rest assured that you have all the same amenities such as fitness gym, swimming pool, bar, and the like.
2. You have the luxury of a private condo.’
Your EC may be still under the HBD for the first ten years but rest assured that you’ll be able to experience all the amenities such as swimming pool, tennis court, fitness gym, or a night bar. While some people simply ignore these amenities because of their age, some residents enjoy these amenities after a busy day at work. It still has the vibes of a private condo.
3. Single people are denied of EC
Since we are talking about family housing here, you should apply as a couple or with your husband or wife-to-be, with your parents, or any of your kids. Even if you are divorced, as long as you have a family with some kids running around you are qualified for the EC. However, if you are a single parent, technically single in your papers because you were never married in the first place, even if you have a lot of kids you will not be approved of purchasing an EC.
4. Manage your bank loan first
It is important that you manage your bank loan first especially if you are deeply concerned with the amount of interest that you are going to pay. However, when it comes to EC, there are limited options. Bank loans may offer you lower interest rates, but you need to provide a down payment first. Aside from that, they will limit you to up to 80% maximum only for the HBD loans.
5. Extra payment in mind
The HBD declared last December 2013 that all EC buyers are under the Resale Levy where they are required to pay the sum payment should they wish to repurchase another subsidized home. Resale Levy is already considered a reduction of subsidies if you’re going to have your second subsidized home. Also, keep in mind that this rule is only applicable on December 9, 2013, only.
These are the factors that you need to consider should you wish to buy an executive condominium in Singapore. Keep these tips in mind and rest assured that you’ll be able to buy the right unit for your family. Property investments are one of the most expensive investments you could make. Hence, you need to make sure every single cent is worth it.