Major Changes To Exec Condo Rules

Source : TODAY, Wednesday, November 21, 2007

IT HAS just become much more attractive to own an Executive Condominium (EC).

For a start, second-time flat buyers who buy a new EC will no longer have to pay the resale levy.

The policy change, announced yesterday by the Housing and Development Board (HDB), will apply to those who buy the new EC units to be built on a site at the junction of Punggol Road and Punggol Field.

The site was released under the Reserve List of the Government Land Sales programme.

"The new rules will increase the demand for ECs," said Mr Donald Han, managing director of property consultancy Cushman and Wakefield.

"At the entry level, it will help new purchasers and upgraders to consider an EC as their first choice … plus Punggol has been targeted as a waterfront township in the future, so there will be keen interest among developers and contractors for this site," he added.

The HDB also announced yesterday that first-time buyers of new ECs can now buy a second new EC, HDB or a Design, Build, Sell Scheme (DBSS) flat.

However, they have to wait 30 months after the sale of their first EC before they can apply to buy a new EC, HDB or DBSS flat. There is no moratorium for a HDB resale flat.

While the scrapping of the debarment will increase demand for new ECs, the change is likely to have a limited impact, analysts said.

"The 30-month waiting period is a bit of a hindrance because most buyers of EC tend to be newlyweds. After five years, they would probably have children, who would be just about to go to kindergarten," said Mr Nicholas Mak, director, Consultancy and Research Department at Knight Frank.

"You expect them to sell their EC and wait for 30 months; where are they going to stay for 30 months? Not many people might take this up."