Executive Condo (EC) bubble?

[tokidoki_sg]

EC if targeting at HDB upgraders then for sure gone case.
Cos upgrader usually will only sell the flat nearer to the key collection, make no sense to sell 1st, book an EC and rent a place for 3yrs which HDB policy do not require u to do so.
So the loaded part will only materialized in later part and not initial when booking EC.
Also, the initial CASH upfront is ridiculous for an upgrader compared to 1st timer. Not all will bite or can afford, the loan is lesser than 80% as well means u need more downpayment.

Furthermore, dun forget only 30% of the units can be sold to upgraders, still need to sell to the bulk of 70% first timer for EC.

 

[PingJun]

It's true on the 5 % and 15% initially. Very tough for young couples and upgraders. I saw people selling their hdb to pay the 15% and stay with parents, some more with kids squeeze in one room waiting for the TOP.

Now even harder as need pay say 25%?

25% of cash (or CPF) should be meant for PC.

I don't think EC is affected, ie, should be still remains as 20% (cash + CPF).

 

[dnsfpl]

20% is all cash ma

can use cpf meh

 

[kiatme]

payment should be the same as private
government adjusted the LTV ratio, so it should apply to ECs as well since you are taking loan from the bank

 

[PingJun]

Currently, the interest rate for bank loan is also getting higher.

This might be also one of the concerns for the buyers of EC.

 

[PingJun]

20% is all cash ma

can use cpf meh

I remember is 5% must be cash.

The rest can be either cash or CPF or both.

 

[infernolord]

1m ec = 200k cash = 100k each

few of my kaki loan from their parents

But again there are alot upgraders, you look at the recent MOP punggol bt0.
Just give an example, Punggol walk 5rm hdb, they bought bto at 350k, selling price now abt 550-650k. They made a total of 200k. That is 50k a year.

Damn seriously shocked when i look at the numbers.




That why alot of 5yrs MOP units on sales. With 200k profit, upgrade lo.

 

[Pokémon]

25% of cash (or CPF) should be meant for PC.

I don't think EC is affected, ie, should be still remains as 20% (cash + CPF).

As far as I know, as long as you choose to finance your HDB BTO, resale flat and any other residential properties with a bank loan, the new LTV limit applies.

 

[bojangle]

For upgraders better think carefully before commit, cos it involves your existing flat and 3 or 4yrs later TOP what will your flat worth at that time and accrued interest.
Especially after the recent hoohaa 99yrs zero value affecting all old flats resale price. Many upgraders missed out the value of their flat worth in later years, agents will only tells you how much your flat worth today and won't be able to predict future price. And accrued interest as of today as well.

Also, upgrader needs to pay the levy when book EC if I'm not wrong. The upfront total sum is just too huge and doesn't make sense comparing the selling price with levy added.

 

[dnsfpl]

But again there are alot upgraders, you look at the recent MOP punggol bt0.
Just give an example, Punggol walk 5rm hdb, they bought bto at 350k, selling price now abt 550-650k. They made a total of 200k. That is 50k a year.

Damn seriously shocked when i look at the numbers.




That why alot of 5yrs MOP units on sales. With 200k profit, upgrade lo.

profit is only when you sell your hdb lei, ie 3 years later
5% + 15% pay upon booking and exercising wor, ie now

plus buy 350k sell 550k is not 200k profit
you forget reno, incurred interest stamp duty legal fee and other misc cost?
i think max 120k, ie 60k each happy liao

 

[PingJun]

As far as I know, as long as you choose to finance your HDB BTO, resale flat and any other residential properties with a bank loan, the new LTV limit applies.

I'm unsure for 2nd timers.

This is more for 1st timers, who have no property, and of which majority are the buyers of EC....

 

[d5dude]

profit is only when you sell your hdb lei, ie 3 years later
5% + 15% pay upon booking and exercising wor, ie now

plus buy 350k sell 550k is not 200k profit
you forget reno, incurred interest stamp duty legal fee and other misc cost?
i think max 120k, ie 60k each happy liao

350k can sell 550k may not be 200k net profit but its a 50+% gain, its very good compared to ECs. Based on the recent transactions for some of the ECs that were launched back in 2010/2011 (when market prices were generally lower compared to now), the gain is really peanuts when you look at the big quantum involved. Apart from Prive, the other developments mostly only went up around 20%, the quantum is higher but the gain in dollar amount is about the same.

Good luck to whoever is buying these new ECs at 1k+ psf...

 

[Pokémon]

I'm unsure for 2nd timers.

This is more for 1st timers, who have no property, and of which majority are the buyers of EC....

No, how many 'timers' does not matter.

Source: http://www.mas.gov.sg/News-and-Publ...-Tightening-Loan-to-Value-Limits.aspx#content

 

[dleodleo]

profit is only when you sell your hdb lei, ie 3 years later
5% + 15% pay upon booking and exercising wor, ie now

plus buy 350k sell 550k is not 200k profit
you forget reno, incurred interest stamp duty legal fee and other misc cost?
i think max 120k, ie 60k each happy liao

Very true. Moreover HDB 5 rooms can't sell very well now. My neighbour sold his 5 rooms in Sengkang at $400,000 only.

If I were to upgrade to EC, I dun think I'll gain much profit cos I bought it at $300,000. Not forgetting I have to pay $45,000 for resale levy. With the high selling price of EC, I dun think 2nd timers can afford anymore.

 

[darknite84]

25% of cash (or CPF) should be meant for PC.

I don't think EC is affected, ie, should be still remains as 20% (cash + CPF).

EC cannot take HDB loan. Must take bank loan. But still subjected to MSR calculation.

 

[tomicaguy]

Isn't LTV further limited by MSR?

 

[birmingham123]

Very true. Moreover HDB 5 rooms can't sell very well now. My neighbour sold his 5 rooms in Sengkang at $400,000 only.

If I were to upgrade to EC, I dun think I'll gain much profit cos I bought it at $300,000. Not forgetting I have to pay $45,000 for resale levy. With the high selling price of EC, I dun think 2nd timers can afford anymore.

Serious ? 5 room HDB sell only for 400k ? How old is the unit ??

 

[annetyu]

Serious ? 5 room HDB sell only for 400k ? How old is the unit ??

I was curious and went to check briefly. First one I saw, nicely renovated 5rm at 450k only. I am sure there are many more. The recent frenzy in the condo market has probably made us neglect the HDB market or we assume that it is catching up as well.

 

[bojangle]

Very true. Moreover HDB 5 rooms can't sell very well now. My neighbour sold his 5 rooms in Sengkang at $400,000 only.

If I were to upgrade to EC, I dun think I'll gain much profit cos I bought it at $300,000. Not forgetting I have to pay $45,000 for resale levy. With the high selling price of EC, I dun think 2nd timers can afford anymore.

Fake news! 5rms sold at 1mil recently. just kidding

EC does not favour upgraders. Like your case, even if you can afford the resale levy, 4yrs later when EC TOP, you start selling your flat and it became 350k due to aging will be even worst. On the other hand, accrued interest increased another 4yrs as well.

If thinking to upgrade, only resale private is the better path. Nett downpayment (now is 25%), stamp duty and legal fees.

Buy EC pay resale levy, buy private no need.

if EC selling at 1k psf, with 50k levy is considering $1050psf based on 1000sqft, at this price u can maybe get freehold resale too.

 

[dleodleo]

Serious ? 5 room HDB sell only for 400k ? How old is the unit ??

18 years. Beside LRT and 8 mins walk to MRT somemore.