Home buyers have picked a substantial number of executive condos in 2016, a total of 4000 ECs marking a 56.82% increase compared to units sold in 2015. The demand for executive condos continues to steadily increase since the fall in supply of this type of housing due to the introduction of cooling measures in 2014. Let’s look at some of the top reason why more buyers are going for ECs in Singapore.
The increase of some ECs sold in 2016 can be attributed to the overwhelming response of better prices thanks to competition between private contractors. For example, Sim Lian sold a398 units in Treasure Crest, out of 500 units in a month upon its launch. The average cost of EC at Treasure Crest was S$737, a lower price compared to projects done by The Vales and Belleswater before.
Possibility of further decline is low
Prices of ECs have substantially decreased since late 2014 and early 2015. This makes the possibility of the prices going down limited with buyers wanting to take advantage of the price shoots back up. For example, in 2017 only a few ECs were launched with another one late in the year. Fewer executive condos mean the demand will go high, and the price will follow suit.
More EC nearing TOP
When new executive condos reach their TOP dates, they will become more attractive to those wanting to upgrade their homes or to the 1st time buyers who need a home soon. For home upgrades, this will ease the financial burden of buying a second property while 1st homeowners will need a new place as getting a house form resale market.
Limited choices by location in Singapore
There are upcoming executive condos by Choa Chu Kang, Anchorvale and Yoi Chu Kang. Buyers preferring other location have no choice. For instance, if you are looking to stay in Jurong, Lakelife and Westwood residences are the only ECs available. For Canberra, you have to choose between The Visionaries and Brownstone.
EC is a safer and wiser investment option
In today’s property market, commercial, industrial properties, and private residential are facing times of uncertainties making ECs a more reliable choice and a better investment choice. According to research by OrangeTee, first-hand owners of private EC are bound to make considerable gains however it’s important to note that 21 ECs studied were purchased before the Asian financial crisis. Therefore if you plan to hand on your EC, you are highly likely to enjoy a proper capital appreciation.
This gain is even better when you own a new executive condominium, a primary reason being new ECs are priced up to 20% lower than private condos during the launch. After 5 years the price can between private condos and ECs narrows to 9%. After 10 years, this gap drops down to 5%.
So what do we expect this year? More upgraders are expected to come into ECs that for sure. Therefore, if you are interested in owning one, it’s high time you start looking for one that works for your property budget.