Expected to still sell: ECs benefit from bigger buyer pool

Expected to still sell: ECs benefit from bigger buyer pool
Above photo is Footwear outside the Arc at Tampines showflat last year. It was the first EC launched after income cap changes were announced.

The many executive condominiums (ECs) heading to the market can be absorbed thanks to the expanded pool of buyers generated by changes to the income ceiling, a DTZ report said.

The Government increased the monthly household income ceiling from $10,000 to $12,000 in August last year so it is unlikely an oversupply will arise, the firm added.

Figures from the 2010 Census show how this policy change has expanded the buying pool.

There were 72,065 households in Housing Board (HDB) four-room flats or larger earning between $8,000 and $10,000 in 2010, noted consultancy DTZ on wednesday.

This segment used to be the target market for buyers of ECs as the income ceiling for HDB flats was $8,000 then.

Department of Statistics figures, also from 2010, show that there were around 46,000 households in HDB four-room flats or larger that earned between $10,000 and $12,000.

The increased income ceiling means these 46,000 households are also eligible for ECs.

This enlarged pool of buyers can soak up the supply from the string of new launches since the EC segment was reintroduced in 2010, say experts.

There were about 6,500 EC units in the pipeline as at Sept 30 with an additional 3,100 potentially in the mix from sites that could be sold in the land sales programme for the first half of next year.

There had been concerns that the bumper supply of EC plots pushed out by the Government to cater to the so-called "sandwiched class" might lead to a glut.

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