SINGAPORE: Which option offers better value in Singapore’s property market—a Build-To-Order (BTO) flat or an Executive Condominium (EC)?
According to the Singapore Business Review, DBS has advised considering factors like resale conditions, personal goals, affordability, and housing supply when choosing between a BTO flat and an EC.
1. Personal goals
If your goal is to get capital gains from assets, DBS said ECs are the way to go. DBS noted that ECs tend to “have the potential for higher price appreciation” than BTO flats.
EC projects reaching their Minimum Occupation Period (MOP) in 2023-2024 saw median price increases of 60% to 90%, with 900 square feet (sq ft) units gaining over S$500,000, DBS said.
Based on historical data, DBS added that the median price of new private launches could serve as a “proxy” for the resale price of ECs once they reach MOP.
They noted that the current median price of new launches reflects the potential resale price of ECs eight years later.
In 2016, the median price of new private launches was S$1,384 per square foot, while resale ECs in October 2024 averaged S$1,331 per square foot.
DBS added that the current median price of S$2,200 per square foot for new private launches could provide an estimate of potential future resale prices for ECs, assuming household income growth supports future demand.
2. Affordability
When it comes to cost, DBS highlighted that BTO flats require a smaller down payment of 10%, usually covered by an HDB loan.
On the other hand, ECs need a larger initial payment of 25%, typically financed through a bank loan.
DBS said that because the overall cost is high, the difference in the down payment is “significant.” “Buyers should carefully assess their financial capacity before making a decision,” DBS said.
For example, the most expensive BTO flat to date, a five-room unit at Central Weave in Ang Mo Kio, costs S$877,000, with a down payment of under S$90,000.
Meanwhile, a typical EC, priced at S$1.4 million, requires a down payment of around S$350,000—about four times more than the BTO.
DBS said public housing is generally the most affordable option in Singapore’s property market.
However, there are income limits: families must earn no more than S$14,000 per month, and singles no more than S$7,000 to qualify for subsidies for new flats.
DBS added that people selling their HDB flats and making a profit will likely be interested in buying ECs.
3. Resale Conditions
For those interested in reselling later, DBS explained that standard BTO flats and ECs have the same five-year MOP.
However, BTO flats in the Plus and Prime categories have stricter rules, including a 10-year MOP, no renting out the whole flat after the MOP, a 6% to 9% resale subsidy clawback, income caps for resale eligibility, and a 30% Mortgage Servicing Ratio (MSR) limit for resale buyers.
DBS noted that EC resale units are more affordable because they have no income cap and a 55% Total Debt Servicing Ratio (TDSR) limit, making them available to a broader range of buyers, including foreigners and companies.
4. Supply
Also, Singapore homebuyers need to consider that BTO flats are available more frequently, with new units launched three times a year. In October, 8,573 units were launched.
ECs, however, are released less frequently, with only one or two projects a year. This means it is significantly more limited. /TISG
Read also: 2-room flexi BTO flats in October launch sees overwhelming demand from first-time single home buyers
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