The price gap between new and resale apartments also narrowed in the third quarter of this year.
Executive condominium (EC) prices in Singapore are climbing due to their limited supply and increasing popularity among young families and public housing upgraders, according to a market report by Singapore Realtors Inc (SRI). This trend is part of the broader landscape of Singapore New Property Launches, which continues to attract significant interest.
Released on Thursday (Nov 7), the report revealed that the average price of newly launched ECs was S$1,460 per square foot (psf) for the first nine months of this year, marking a 24.1% increase from 2021’s S$1,176 psf.
Over half of these newly launched ECs were sold at over S$1,500 psf this year. Approximately 20% were transacted at S$1,300 to S$1,400 psf, and another 20% at S$1,400 to S$1,500 psf. The remaining 8.8% were sold for under S$1,300 psf.
The highest transaction was for a 925.7 square foot unit at Parc Central Residences in Tampines, sold for S$1.6 million or S$1,680 psf in March. This is the highest price per square foot for a new EC unit to date, according to SRI head of research and data analytics Mohan Sandrasegeran.
These trends reflect a growing willingness among EC buyers to invest at these price points, driven by the perceived value and strategic location of these projects, noted Sandrasegeran.
“Buyers are increasingly prioritising strategic positioning, lifestyle amenities, and the unique attributes of ECs, which offer a hybrid between public and private housing,” he said. “These factors contribute to the sustained attractiveness of ECs, even in an environment where price levels are on the rise.”
This also demonstrates buyers’ confidence in the long-term value appreciation potential of ECs, he added.
This confidence is bolstered by government regulations that allow developers to start selling EC units only 15 months after the site is awarded, or upon the completion of foundation works, whichever comes first. “By carefully controlling EC availability, the authorities foster steady price growth, preserving ECs’ long-term value and viability within Singapore’s residential landscape,” he added.
Meanwhile, the price gap between new and resale ECs has narrowed in recent quarters. In Q3, the price gap between new and resale flats was just S$97 psf or 6.9%. In comparison, it was S$109 psf or 7.7% in Q2, and S$214 psf or 14.4% in Q1.
Sandrasegeran attributed the narrowing price gap to a limited “active supply” of new ECs, as well as the five-year minimum occupation period for homebuyers, and the 10-year period for a development to attain privatised status.
On the resale front, demand for ECs aged 10 years or more rose by 63.8% year on year to 375 units in the first nine months of 2024. Sales volume of ECs aged 10 years or less saw a more modest growth of 1.8% to 1,181 units.
Consequently, the average price of older ECs rose by 15.5% to S$1,171 psf in the first nine months of this year, while that of ECs aged 10 years or less grew 5.7% year on year to S$1,350 psf.
Sandrasegeran said buyers were likely drawn to mature ECs that had already privatised.
These flats could also have “strategic locations within well-established neighbourhoods” that offer a balanced mix of amenities and convenient transportation options, he said.
Overall, he believes that ECs will continue to serve as a unique asset class, attracting aspiring homeowners due to their relative affordability, exclusivity, and potential for capital appreciation.
New EC projects, such as Novo Place in Tengah, are likely to see strong enthusiasm from potential buyers, similar to recent EC projects, he said. For instance, Lumina Grand in Bukit Batok, which launched in Q1, has already sold 426, or 83.2%, of its 512 units at a median price of S$1,524 psf.
Source: The Straitstimes