As interest rates rise and loan restrictions increase, EC buyers are turning to resale properties to pay down debt. These properties are cheaper than private condos and come with free DPS. These properties also don’t have the MOP restriction.
ECs are a hybrid between public and private housing
ECs are hybrid housing units that are both public and private in nature. They are aimed at the sandwich class of home buyers, and their prices and designs are comparable to private condos. ECs are available for sale from private developers, and are open to Singapore citizens and foreigners who form a family unit. To qualify for an EC, the household’s average gross monthly income must be at least $12,000, although resale units are exempt from this requirement.
The government has been committed to building more ECs, which are hybrids of public and private housing. More than 14,600 EC units are already available on the market, and another 3,000 are expected to go on sale in the coming year. While most Singaporeans will continue to live in public housing, the Government’s goal is to ensure that first-time buyers, newly-wed couples and HDB second-timers have access to affordable housing. To achieve this goal, the Government has introduced four rounds of cooling measures since 2009. The latest measures introduced in December 2011 include an additional 10 per cent buyers stamp duty on foreign buyers.
They are cheaper than private condos
Resale properties for EC buyers are typically cheaper than private condos for a number of reasons. First, they are built on more affordable land and have lower land costs than private condominiums. Second, ECs are not subject to the price spikes experienced by mass-market condos. Third, the HDB limits EC buyers to citizens. The income ceiling was recently increased to $12,000 psf per month, so first-time buyers may still qualify for housing grants.
The price difference between ECs and private condos is substantial. The median resale price in 2020 was 50.8 percent lower than that of new condos. By contrast, the median resale price for private condominiums was just under forty percent. This large gap is likely to remain, and it will continue to attract buyers seeking a more affordable private home in the suburbs.
They offer DPS
As interest rates go up and ECs become more expensive, many EC buyers are looking to resale their properties. This way, they can still access the equity in their EC. This is especially beneficial for upgraders who want to upgrade from flat to EC.
ECs have a lower starting price than private condos but still include the typical amenities of private condos. In addition, ECs are eligible for the CPF Housing Grants and are sold to foreign buyers as early as their eleventh year.
They have no MOP restriction
Resale properties are an excellent choice for people with limited budgets and a volatile financial situation. ECs are typically restricted to HDB flat owners, but you can buy a resale EC with a 5-year MOP. This type of property is perfect for people who are looking for a more premium residence, but want to maintain the same level of amenities as a HDB.
Resale ECs have several advantages over new properties. They may be a bit more expensive, but they’ll have lower MOPs and are no longer subject to government restrictions. And unlike new housing, resale ECs are not subject to CPF housing grants, so you’ll be able to sell them for a much higher price.
They have no upfront ABSD
As loan eligibility restrictions get tighter, EC Buyers are turning to resale properties to buy their new home. They can enjoy benefits such as no ABSD or DPS, which helps them alleviate cash flow problems. However, there are several factors to consider before purchasing an EC.
ECs are private property, and are generally expensive. Singles are unable to qualify for housing grants when they purchase ECs. In addition, buying an EC is similar to buying a BTO flat. Moreover, buyers must wait two to three years before moving in.
ECs are financed by bank loans and become private after the first ten years. Once the ten years have passed, the pool of buyers expands to include foreign buyers. ECs can be bought by foreigners if they meet the income ceiling, but buyers who want to buy an EC from the first owner can enjoy a guaranteed tenure in the property.