Singapore Executive Condominium (EC) significantly underperform condominiums when referring to investment return for at least first 5 years, according to OrangeTee Research report.
Being a public-private residential structures, sales for EC are restricted by some rules, like the Minimum Occupation Period or MOP requirement. Owner cannot rented out EC within the first 5 years after being bought, it can only sell in the open market 10 years after its first sale.
If buyer bought EC purely for investment and has no intention of staying for the entire holding period, ECs proves inferior investment as to condominiums, according to report.
Compared to private condominiums, Singapore ECs are much cheaper by 20 percent which likely to appreciate in value in a long run. These developments bear higher costs of holding for the first 5 years considering the MOP requirement.
However, if property investor plan to wait for 10 years period or until that EC project can be sold in the open market, then investing an Executive Condominium (EC) might be better than purchasing a condominium property.
EC projects such as The Criterion EC, The Terrace EC and Parc Life EC, would be better investment in the longer term due to the lower basic purchase price and cash inflow due to rental income from year 6 to year 10.