How to book a new Executive Condominium in 2017?

Eligibility Conditions & Schemes

To qualify, all applicants need to be at least 21 years old (35 years if you’re applying under the Joint Singles Scheme). One of you must also be a Singapore Citizen, with at least one other applicant being either a Singapore Citizen or Permanent Resident. In addition, your combined gross monthly household income cannot exceed $14,000, plus, you’ll be required to fall under one of the following HDB eligibility schemes:

• Public Scheme
• Fiancé/Fiancée Scheme
• Orphans Scheme
• Joint Singles Scheme

Other Restrictions to your Executive Condominium ownership:

You’ll also be prevented from purchasing an EC if you or your co-applicants:

• own non-HDB property (overseas or locally), or have disposed of such property within the last 30 month.
• own/have owned more than 1 of the following: (i) flat bought from HDB; (ii) EC/DBSS flat bought from a developer; or (iii) HDB resale flat bought with a CPF Housing Grant
• haven’t met the minimum occupation period on your current subsidised HDB flat. If it’s an executive condominium, you’ll need to wait a further 30 months from its date of disposal, before you can apply for a new one
• are a divorcee – for 3 years from the date of divorce, only 1 party of the divorce can own a subsidised flat
• have previously cancelled an HDB application or terminated the Sales & Purchase Agreement (S&P) for a DBSS flat/EC using a CPF Housing Grant, in which case you’ll be barred for 1 year or 5 years respectively.

So you are eligible to purchase a new executive condominium. The question now is – are you able to fund for it?
When buying a new home, it is also important for you to evaluate your financial situation so you know what you can or cannot buy. It isn’t just about the purchase. There are also other costs and taxes you will need to factor into this purchase decision.

Get an Approval-in-Principle (AIP) from a Bank

Approach a bank and get yourself an Approval-in-Principle done. That should allow you to know how much the bank can loan you and your monthly mortgage payments.
Note that your loan will be subjected to the regulations such as Total Debt Servicing Ratio and Mortgage Servicing Ratio – so depending on your existing loans and lines of credit, your total loan might be lower than you expect.

Do you have sufficient CPF Funds?

If you have the intent to fund the purchase using your CPF, do remember that for your first property, you should be able to use all the savings in your Ordinary Account. But if it’s your second or subsequent property, you’re required to set aside at least the current Basic Retirement Sum (As time of article in 2017 – it is $83,000) in your Ordinary Account and only use any savings in excess of that.

Check for other fees and resale levy

You will not be able to take up a HDB Loan if you are buying an executive condominium, you will need to secure a loan from the bank. For bank loan, you will be eligible up to a maximum of 80 percent of the property purchase price. Legally, you must pay for at least 20 percent of the property (referred to as the down payment) in a mixture of cash or CPF savings (this includes a 5 percent Option Fee and a 15 percent Exercise Fee).

Not only that, you should factor in incidental costs like legal fees and Buyer’s Stamp Duty (BSD), all of which can come up to quite a sizeable sum.

Example: Let’s take the example of a property purchase price of $800,000. You will need to pay:

• Option Fee (5%) : $40,000
• Exercise Fee (15%) : $120,000
• Buyer’s Stamp Duty : $18,600

Points to highlight:

• You will be able to utilize your CPF savings to pay these costs, but if you don’t have enough to cover the total amount, you’ll need to pay in cash.
• If you’ve previously purchased a flat from HDB, or received a CPF Housing Grant, you may also have to pay an additional resale levy of $55,000 when purchasing your new executive condominium.
• Also, if this isn’t your first property, or you’re a Singapore Permanent Resident applicant, you’ll be liable to pay an Additional Buyer’s Stamp Duty as well.

Shop

Shortlist the ones you’re interested in and contact the developers to get more information about the executive condominium. Unlike regular HDB apartment, an executive condominium is sold directly by the developer. For the latest Executive Condominium updates, you may contact us here.

Apply

It’s now to submit your application once you have shortlisted your ideal development. This by no means obligates you to purchase the flat; it’s more a registration of your interest. The benefit of completing an eApp is that when the development is officially launched, you’ll be given priority to view and book a unit.

Book

On the development’s sales launch, registered applicants will be invited to view the show units and proceed to book. The developer can opt to go about this with a ballot such that applicants are invited to view and book in order of the ballot number. This means the lower your ballot number, the greater the choice of units you have and the higher your chances of getting the unit of your choice.

Depending on how high your ballot number is, you might want to have a few shortlisted units in mind, just in case your first few choices get snapped up by those ahead. Once that’s over, the launch is officially open to the general public.