Should a HDB upgrader consider an EC over private resale property?

By EdgeProp Singapore / EdgeProp | June 24, 2018 8:00 AM SGT
Looking to upgrade? The 597-unit The Santorini made our list of one of the most affordable condos for HDB upgraders in 2018.
The growing disparity in condo and HDB home prices have made it increasingly difficult for HDB homeowners to make the jump toward private properties.
The price gap is expected to grow wider as HDB resale prices continue on a downtrend, with the ongoing supply of new Build-To-Order (BTO) projects and the recent announcement that not all older HDB flats will be eligible for Selective En bloc Redevelopment Scheme.
On the other hand, private property prices have been on a steady uptrend, spurred by strong collective sale activities and bullish bids for land sales by developers.
For those with budget constraints, the surge in private home prices may push them in the direction of the executive condominium (EC) market or the resale market for older condos in the suburbs, where prices have not risen as quickly as newer projects.
Prices of new homes in Outside Central Region (OCR) rose to an average of $1,360 in 2018 from $1,228 in 2017. In comparison, resale home prices for OCR properties averaged at $968 psf in 2018 from $925 psf in 2017.
EC or older resale condos – what are some considerations?
1) Pricing
ECs are a public-private hybrid type of housing that caters to the sandwiched class. They’re a lot like condominiums, but come with added restrictions.
However, because they fall under the HDB umbrella, EC applicants are eligible for certain CPF Housing Grants. For instance, first-time applicants who are Singapore citizens and are applying as a couple can get up to $30,000 worth of housing grants (full list of grants here).
Of course, the main appeal is that ECs are typically priced significantly lower than private properties, but tend to come with similar amenities such as a swimming pool, a gym and BBQ pits.
In 1H2018, prices of resale condos that were completed up to 10 years ago in the Outside Central Region (OCR) averaged at $1,068 psf.
In comparison, EC resale prices averaged at $813 psf within the same time period in 2018. However, the April 2018 launch of the new EC, Rivercove Residences has set a new...