The Executive Condominium Option

What is an executive condominium?

Executive condominiums are a form of unique hybrid public housing that is governed by the Executive Condominium Housing Act & Executive Condominium Housing Scheme Regulations.

It is unique in the sense that it starts off as a form of public housing supervised by the Housing and Development Board before before eventually becoming a private property. See section on rules below.

On the outside (& inside actually), an executive condominium looks exactly like a private condominium.

An executive condominium is gated and comes with facilities that are commonly found in a private condominium.

Executive condominiums only sit on 99-years leasehold land parcels, which is one of the more common land tenures for private condominiums.

Like private condominiums, the owners of executive condominiums have the option (10 years after TOP) to opt for a collective sale (en bloc sale) as a form of exit strategy further down the road as the buildings start to age.

They are also built by private developers.

The similarities end here.

What are the rules for executive condominiums?

These are the rules that are unique to the executive condominiums compared to private condominiums.

✅ Only Singaporeans (various forms of family nucleus) can purchase a brand new executive condominium under one of the following schemes – public scheme, fiance/fiancee scheme, orphans scheme, joint singles scheme.

✅ A married couple must be of the pairing Singaporean/Singaporean or Singaporean/Singapore Permanent Resident in order to be eligible to purchase.

✅ Only buyers with a combined household income of less than $16k (subject to change) are allowed to buy.

✅ Buyers of brand new executive condominiums are only allowed to sell after the executive condominiums turn 5 years old (from TOP date).

✅ Executive condominiums can be rented out only after crossing the 5 years old mark.

✅ Between the 5 and 10 years mark, the executive condominiums can only be sold to Singaporeans or Singapore permanent residents.

✅ After the 10 years mark, the executive condominium will become a full-fledged private condominium and foreigners would be eligible to purchase.

✅ The mortgage servicing ratio (MSR) & total debt servicing ratio (TDSR) are used to determine how much a buyer of a brand new executive condominium can borrow.

✅ Resale levy may be payable for certain buyers of executive condominiums.

Please visit the HDB website for the latest rules that are applicable for the purchase of executive condominiums.

Why buy brand new executive condominiums?

So many rules… why would a buyer want to buy an executive condominium then?

Why not consider other residential properties?

The answer lies in the attractive sale price during the initial sales launch.

Executive condominiums sit on land parcels that are sold at a subsidised rate by the government.

Hence they are priced cheaper than comparable private condominiums during the initial sales launch.

Besides a lower entry price, they also offer a very good chance of capital appreciation which I will touch on in the next section.

In addition, a couple who currently owns a HDB can purchase a brand new under construction executive condominium first (need to pay downpayment) without having to incur additional buyer stamp duty (ABSD). If their finances allow them to, they can continue to stay in the HDB and sell it closer to the date when the construction of the executive condominium is completed.

And as a side bonus, certain buyers of executive condominiums may be eligible for CPF housing grants.