Buying EC in Singapore: Income Ceiling Eligibility and How Much to Earn to Afford an Executive Condo? (2023)

PropertyGuru Editorial Team
Buying EC in Singapore: Income Ceiling Eligibility and How Much to Earn to Afford an Executive Condo? (2023)
Executive condos (ECs) are a hybrid between public housing and private condos, designed for the sandwich class of Singaporeans. ECs provide an affordable middle ground between HDB flats and fully private condos, offering all the frills of a typical condo with a subsidised price tag. Its affordability is why there is a high demand for ECs in Singapore. For instance, the first EC launch of 2022, North Gaia, received around 3,500 visitors during its preview weekend in April 2022. The later EC launches, Copen Grand in Tengah and Tenet in Tampines, performed well as expected too.
As such, many of you must have wondered, how much do you need to buy an EC in Singapore?
Considering the income ceiling of regular HDB flats and ECs, the target market for ECs is households who earn between $14,000 and $16,000 per month; the EC income ceiling is $16,000. But must you earn that much to be able to purchase an EC? We work backwards to find out how much, at minimum, you need to earn to own an executive condo in Singapore.

Watch Our Video on Financing Executive Condos in Singapore

Who Can Buy EC? EC Income Ceiling, Eligibility, and Rules

Executive condos are considered to be HDB properties for the first 10 years; as such ECs are called private-public properties. ECs are developed and sold by private real estate developers. But the Singapore government subsidises the price and allows the use of certain CPF housing grants (more on that below).
This is why executive condos are considered HDB properties in the first 10 years and are bound by certain HDB rules, just like HDB flats. These rules include, but are not limited to:
HDB’s five-year Minimum Occupation Period (MOP) ruleYou must wait five years before you’re allowed to sell and/or rent out your EC. After five years, you can sell to other Singaporeans. After 10 years, you can sell to anyone, including foreigners
EC income ceilingYour household cannot earn more than $16,000 a month
Property ownership ruleYou should not own or have disposed of any other property, whether in Singapore or overseas within the last 30 months, and you haven’t bought an EC, HDB and/or DBSS flat, or received a housing grant before applying to buy an EC

Financing Your EC Purchase: Things to Take Note of

Before we show you how to calculate the income you need to afford an EC, here are some important facts about ECs that will affect how you afford and pay for it.

1. EC Buyers Not Eligible for HDB Loans (Only Bank Loans)

It’s important to note that even though ECs are considered HDB properties in the first decade, you can only finance them through a bank loan. That means the Loan-to-Value (LTV) limit, or the maximum amount you can borrow is capped at 75% of the property price.
Since EC buyers cannot finance their house through HDB loans, they will need to fork out more cash for their downpayment. With a bank loan, EC buyers would need to pay for the remaining 25% as a downpayment (5% of which must be paid in cash, and the other 20% can be paid using your CPF OA savings and/or cash).

2. Debt Servicing Ratios: Both TDSR and MSR Apply for EC

Unlike private condos, where you only have to think about your Total Debt Servicing Ratio (TDSR), or the amount you use from your gross monthly income to pay for all your debts, there is an additional restriction for ECs. The Mortgage Servicing Ratio (MSR), which caps the proportion of your monthly income used for mortgage repayments to just 30%, applies.
With the announcement of the September 2022 property cooling measures, the interest rate floor has been increased by 0.5%. Likely, the amount you can borrow from the bank will be affected, meaning you may have to adjust your budget accordingly to how much loan you can get.

CPF Housing Grants for Executive Condos in Singapore

Another thing that sets an EC apart from a private condo is that homebuyers of a new EC may be eligible for CPF housing grants such as the Family Grant and the Half-Housing Grant. However, the caveat is that your monthly gross income shouldn’t exceed $12,000 to apply. Your citizenship and your income range would also affect the amount you can receive.
Now, onto the fun part: figuring out how much ECs cost and calculating how much salary you need to earn based on the average price of ECs.

How Much Does an Executive Condo (EC) Cost?

ECs are more affordable than private condos for two main reasons: firstly, they are usually built at less accessible locations, typically further away from existing MRT stations and malls. Secondly, the land prices are subsidized by the Government. Generally, ECs are located in the Outside Central Region (OCR) and are 25% to 30% cheaper than their private counterparts at launch.
For this guide, we’ll focus on the prices of 3-bedroom ECs (one of the most popular sizes for an average Singaporean household).
Depending on the floor area, a typical 3-bedder EC can cost from $800,000 to $1,200,000. For example, for a recent EC launch – Parc Central Residences at Tampines Avenue 10 – the 3-bedroom units are priced at around $956,000 to $1,069,000.

How Much Do You Need to Earn to Buy an EC?

Now that we know how much an EC will cost let’s work backwards to calculate how much we need to earn.
Here’s how to do it:
Disclaimer: In this example, we can only work backwards based on the rules and regulations. However, when we assess affordability, you should consider not just your debt servicing limits, but also your cash flow situation. After all, it wouldn’t make sense even if you pass the legal hurdles but fail to consider your daily living expenses.

1. Calculate EC Downpayment and Loan Quantum

Break down the price of the EC into two: the downpayment and the home loan. If you are eligible and want to borrow as much as possible from the bank, the maximum LTV is 75% (i.e. 25% downpayment).
EC priceBreakdown
$800,000$200,000 downpayment, $600,000 loan
$1,200,000$300,000 downpayment, $900,000 loan

2. Work Out Your EC’s Monthly Mortgage Instalments

Now that you know how much you intend to borrow, you’ll need to calculate your estimated mortgage repayments based on your preferred interest rate and loan tenure. You may use our mortgage calculator to do this.
For this example, let’s plan for an interest rate of 2.68% p.a. (best interest rate for 12 October 2022, according to the mortgage calculator tool) and a 25-year tenure.
EC priceMonthly mortgage repayments (1.6% p.a., 25 years)
$800,000 (i.e. $600,000 loan)$2,746 per month
$1,200,000 (i.e. $900,000 loan)$4,120 per month

3. Factor in the Mortgage Servicing Ratio for Financing Your EC

As mentioned, the MSR cap of 30% will apply to all EC purchases. Also, note that you can make repayments using the Normal Payment Scheme or a Deferred Payment Scheme, but for the latter, you will need to factor in an additional 2% to 3% to the purchase price before calculation.
For this example, let’s assume you intend to use 30% MSR and pay by the Normal Payment Scheme.
EC priceMinimum income needed (based on 30% MSR)
$800,000 (i.e. $800,000 loan, $2,746 monthly mortgage)$9,153 per month
$1,200,000 (i.e. $900,000 loan, $4,120 monthly mortgage)$13,733 per month
This is assuming you don’t have any other outstanding debts to pay (e.g. student loan, car loan, etc.). And even though it is possible to devote 55% of your income to repayments, it is not necessarily advisable.
All in all, financing an EC may require higher earning power than affording a private condo because of the additional MSR rule. However, comparing apples to apples, if you only use 30% of your income to pay for the monthly instalments, an EC is much more affordable.
It is possible to afford an EC while earning below $10,000 per month; you’ll just need to get a smaller unit in an area that is more budget-friendly. If you want to improve affordability further, you can even consider the smaller units, such as the two-bedroom ones.

Second-timer? Don’t Forget About the HDB Resale Levy

If this is your first property purchase, the above pretty much sums it up.
However, many EC buyers are second-timers who have bought an HDB flat once before and are now upgrading to an affordably ‘private’ property. If you fall into this group, there is one more consideration when calculating your costs: the HDB resale levy.
The resale levy is payable when you buy a subsidised home (e.g. BTO, balance flat), then sell it and buy another subsidised flat or EC. How much you need to pay depends on your previous housing type.
2-room flat
3-room flat
4-room flat
5-room flat
Executive flat
Executive Condominium
Not applicable
Say you are selling your 4-room flat to upgrade to an EC. Based on the table above, you will need to pay $40,000 (household) or $20,000 (if you bought it and are selling it as an individual).

Do You Have Questions About Buying an EC?

As with purchasing any property, you’ll still need to pay Buyer’s Stamp Duty (BSD) and other relevant taxes. This will require you to set aside and have on hand more cash. If this EC purchase is for own-stay and you only have this one property, an $800,000 EC will set you back by $18,600 in BSD; a $1,200,000 EC will require you to fork out $32,600 for BSD.
If you’re interested in purchasing an EC, whether a 3-bedder or otherwise, but you still have a lot of questions with regards to finding the most suitable mortgage, applying for a loan and/or housing grants, planning your monthly repayments and the like, please don’t hesitate to get in touch with PropertyGuru Finance’s mortgage experts.
We can help you analyse your situation and align your property purchase with your financial goals, all at no cost. All the best!
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Disclaimer: The information is provided for general information only. PropertyGuru Pte Ltd makes no representations or warranties in relation to the information, including but not limited to any representation or warranty as to the fitness for any particular purpose of the information to the fullest extent permitted by law. While every effort has been made to ensure that the information provided in this article is accurate, reliable, and complete as of the time of writing, the information provided in this article should not be relied upon to make any financial, investment, real estate or legal decisions. Additionally, the information should not substitute advice from a trained professional who can take into account your personal facts and circumstances, and we accept no liability if you use the information to form decisions.

More FAQs About Executive Condos

The price of ECs will vary between projects. However, they are usually 25% to 30% cheaper than private condos.

This depends on your priorities, but generally, if you're looking for an affordable private property, executive condos are a good option. They offer the same experience for a subsidised price.

The household income ceiling is $16,000, but if you have no other liabilities, you can comfortably afford an EC with less.

You will need to pay for the downpayment, and the various legal fees and stamp duties. There's also the HDB resale levy (if applicable).