Property analysts said subscription rates for executive condominiums (ECs), remain healthy in spite of the uncertain economic outlook. And it is also precisely because of the economic climate that analysts said demand for such housing is likely to stay.
In January, about 1,000 people had indicated their interest to buy one of the 670 units at The Tampines Trilliant – which analysts said was a healthy 1.5 subscription rate. A balloting process was held on Saturday.
Steven Tan, Managing Director of OrangeTee, a real estate agency, said: “We have a very good mixture of first timers and second timers, and we do see that there’s a very strong demand from young couples staying near their parents in the area, so they want to buy an EC which is convenient to visit their family in future.”
Developer Sim Lian Group said prices start from S$682,000 for a three-bedroom unit, and S$971,000 for a four-bedroom unit.
However, compared to private condominiums, property analyst Chris Koh said buying an EC may be a worthwhile investment if one does not mind the restrictions imposed, and waiting 10 years for it to be privatised.
He said: “It may be one ticket to getting your private condominium. I’ve had friends who have bought an EC before. While condominiums were going for S$800,000 to S$900,000, they bought it at S$600,000. But today, 10 years later, when the EC has privatised, it’s now worth S$1 million. So prices have escalated over the 10 years by easily 40 to 50 per cent, or even more.
“But the point is this, in absolute terms, they paid a lot lesser than one who had bought a condominium in that area. So that’s really the savings that one makes when they buy an EC. And if they hold it for 10 years, they would have got the private property that they wanted.”
Even with the uncertain global economic outlook, analysts said demand for ECs is likely to stay.
Mr Koh said: “If the economic situation is not favourable, then all the more they would not be so daring to jump into the private property and buy a brand new condo, or even a resale condo. So what would they do? They’ll fall back and say ‘Perhaps I’ll buy an EC’. So I foresee there will still be a demand.”
Mr Koh added that ECs are attractive to buyers because they are very similar to condominiums.
He said: “In terms of finishings, in terms of facilities, an EC doesn’t lose out to a condominium at all. One, it’s developed by a private developer, so you know he will put in all the facilities to make that EC as classy as a condominium.”
Mr Koh added that most EC buyers are not speculators because there is a minimum occupation period of five years.
Source : Channel NewsAsia – 4 Feb 2012