## S$300,000 Profit! When should you sell your BTO? There’s a reason why many Singaporeans equate balloting for Build-To-Order (BTO) flats to a lucky draw. It’s not just because there’s always almost an oversubscription of hopeful buyers to obtain their first or second HDB flat; rather, it’s because up until now, BTO flats have almost always been sold at a profit. This lies largely with just how subsidized the flats are in the first place – the government sells them way below market price. Up until this point, this is all common knowledge; what we want to analyze is, when is the best time to sell your BTO flat to maximize its profits? We’ll explore this article in 3 parts: ## 1. BTO resale transaction over a 5 year period Firstly, we’ll talk about the hard data regarding the average psf of BTO flats, and analyze, based on the trends of 8 BTO estates, when exactly BTO flats can be sold at its peak price. ## 2. BTO Hard Profit Secondly, we’ll talk about when you should sell your BTO flat based on how you paid for your BTO flat in the first place. ## 3. The reasons why you may not want to sell your BTO flat, even for a large profit? Thirdly, we’ll conclude by giving our opinions on why you may not want to sell your BTO flat, even if you can sell it at a profit. ## 1.BTO resale transaction over a 5 year period Many Singaporeans tend to sell their BTO flats immediately after the 5-year Minimum Occupation Period (MOP) is reached. Let’s take a look at the following table that includes the sale transactions of 8 BTO flats to see if this decision is the correct one to maximize the sale profits of BTO flats. Highlighted in red are the peak BTO sale transaction prices within 5 years after its MOP period. As we can see from the table, 6 out of 8 BTO estates saw the prices of their units peak either on the year of MOP, or within 1 year of that, with only Sri Geylang Serai and Treelodge@Punggol continuing to appreciate over the 5 years. We should note that for Treelodge@Punggol, its average psf increased only by$10 5 years after its MOP period; as for Sri Geylang Serai, its location is pretty much unmatched, and is definitely an outlier in the charts due to its location.

Sri Geylang Serai Source: Archnet

We can see that in most cases, maximum profit can be made when the BTO flat is sold early, right after it MOP. In any case, let’s zoom in on an actual example, highlighting the clear profits and how the exact calculations go down.

## 2. BTO Hard Profit

Let’s assume you and your spouse or fiancée are fresh graduates who have been offered starting pay, and you work for about two to three years before deciding to apply for a BTO flat together. On average, your individual salaries would be between 3.5 to 4 thousand dollars each.

Enhanced Housing Grant(EHG) Source:HDB

In this case, couples would be eligible for a HDB Enhanced Housing Grant (EHG) worth 15 thousand dollars, that counts as Central Provision Fund (CPF) savings in their Ordinary Account (OA) when used to buy their BTO.

With that out of the way, let’s calculate what happens after five years, when the couple is ready to sell their BTO flat. Assuming they use a HDB loan, and using Coralinus as an example.

The final hard profit that a couple selling their BTO flat would earn in this case, is $46,850. Who wouldn’t jump at the chance to earn such a sum of money, in just a span of 5 years? The thing is, things aren’t always as simple as that. As such, ## 3. The reasons why you may not want to sell your BTO flat, even for a large profit? To answer this question, end goal plays a huge part. We’ll split this segment into three parts. ### A. Large Condominium Firstly, let’s say that your end goal is to upgrade to a large condominium that your entire family can live in. A property like that with a good location doesn’t come cheap – 10 or 20 years later, it’s probably only going to be more expensive. The calculations come in if you choose to sell your property now for its maximum profit, and relocate to a resale HDB flat or a smaller condominium using that profit. Even if your BTO flat can generate profit, it doesn’t mean that your next property will. With how the resale HDB market has been looking lately. You may either just breakeven, or sell at a price lower than what you bought it for in the future. In this case, it may benefit you to be a little more prudent and continue holding on to your BTO flat until you’re ready to upgrade to a condominium. Because like we’ve said before, it’s almost impossible for BTO flats not to be sold at a profit. In any case, maximizing your profits doesn’t just mean selling your property at the highest price possible. It can also mean maximizing the use of your profits. ### B. Large Resale HDB Flat Secondly, your end goal may actually be to live in a large resale HDB flat in a prime location, because of how affordable it is for its size and location, as compared to condominiums. In this case, you may as well sell your BTO flat and immediately upgrade to the resale HDB flat you are eyeing, putting the entirety of your profits into your next resale HDB flat. ### C. M.O.P Period Lastly, your end goal might actually change after you’ve moved in to your BTO flat. 5 years waiting for it to MOP is a long time. In those 5 years, you may have started a family, made friends, or maybe your elderly parents have joined you to live in that particular estate. Moreover, you have to factor in the fact that you have to spend about 4-6 years waiting for your BTO flat to even be ready. After waiting for such a long time for your flat, it is inevitable that you might feel some hesitation towards selling your flat after a measly five years. There have been some people that were content enough with their lives in their BTO flat that, even though they could have sold it at a profit, have chosen not to. In simple terms, money isn’t everything. ## Conclusion The question of when you should sell your BTO flat isn’t as simple as it seems. Sure, the simple answer is right after it MOP, but there’s a lot more financial calculations, future goals, and personal priorities that come with it. At Home Quarters, we take all these factors into account before we advise you on how to sell your property, or what property we believe you should buy. We’d be happy to provide you with various analyses, advice, and any sort of assistance you may require, whether you’re a buyer or a seller. Leave your contact details and any queries down below, and we’ll contact you ASAP. ## Contact Us If you have any opinions regarding this article, you can let us know through commenting on our YouTube that we did on this article, sending us a quick email, or hitting us up on our Facebook and Instagram pages to shoot us a quick direct message. If you have questions or if you are thinking about properly showcasing your house for sale, whatsapp message or call KC from Home Quarters and begin finding your new home today: +65 8809 2889! That’s all for this article! Stay safe, and remember, call Home Quarters and start packing! ## Which Executive Condominium earn up to S$1,127,000 ?

In our previous article about when you should sell your Executive Condominium (EC). We discussed Bishan Loft as a major anomaly. Its average price psf has increased by about 167% since it first obtained its Temporary Occupation Permit (TOP) in 2003: from an average of $440.80 psf in 2003, to an average of$1176.30 psf in 2020.

Bishan Loft Source: Propertyguru

Amongst all its Executive Condominium counterparts, it has experienced the most explosive growth thus far. And this growth may not stop anytime soon. Well, that’s nice and all, but we sure this is the question that everyone is wondering. Why has it done so well?

In this article, we’ll be exploring several factors that may have contributed to Bishan Loft’s insane profit margin over the past 17 years, in hopes that we know what exactly to look out for when buying a property that we hope will experience large capital appreciation in the future, just as Bishan Loft is experiencing.

## 1.Demand and Supply

Demand and supply is an economic concept that we’re all familiar with. And it’s one that applies to property as well. When we talk about D&S with regards to Bishan Loft, we’d like to discuss the number of condominiums in close proximity to Bishan MRT station.

Bishan MRT Surrounding Private Property Source: URA

Looking at the Urban Redevelopment Authority (URA) private property map, we see that there are only six condominiums near Bishan MRT, including Bishan Loft. Let’s compare this to a similar region that’s also within the Rest of Central Region (RCR) circumference that’s also considered a mature estate like Bishan – Paya Lebar.

Paya Lebar MRT Surrounding Private Property Source: URA

There are more than twenty condominiums in the vicinity of Paya Lebar MRT. We can see from this comparison that there’s a huge difference in supply between Bishan and Paya Lebar MRT stations when it comes to condominiums.

And where supply is limited and demand is high, we see prices soar. A lack of condominiums in the area around Bishan MRT has directly contributed to the high prices of Bishan Loft.

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## 2. Floor Plan

As a follow-up to the previous point, we’ll be directly comparing Bishan Loft to the other five condominiums in its vicinity.

Bishan 8 floor plan Source:SRX

One thing stands out when we compare Bishan Loft to its condominium counterparts, Rafflesia and Bishan 8, which were also built around the same time period: the two other condominiums have extremely odd-shaped units. Compared to them, Bishan Loft’s regular rectangular-shaped floor plans would be much more appealing to buyers.

Similarly, in 2012, Clover By The Park was launched with floor plans that were slightly atypical. While there isn’t much to say about Sky Habitat and Sky Vue, launched in 2015 and 2017 respectively, we can see that based on floor plan alone, we can confidently say that the measly five condominium competitors in the vicinity have already been narrowed down to simply two.

## 3. Location

It is arguable that Bishan Loft is located in one of the most enviable areas in a mature estate. As mentioned above, not only is it located less than 10 minutes away from Bishan MRT by foot, and thus also within walking distance of the shopping mall Junction 8, it’s also located extremely close to Raffles Institution (RI), Catholic High School, and also Eunoia Junior College.

Bishan surrounding amenities Source: openstreetmap

And again, as mentioned, it’s located in the RCR, and also a mature estate. Other than that, Bishan Loft is surrounded by HDB flats, and consequently has many childcare centres surrounding it. For the same reason, there’s a plethora of neighborhood coffee shops surrounding the property.

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## 4.Initial price

The three above factors talk mostly about why the current average psf of Bishan Loft is so high as compared to its other counterparts or alternatives; however, what contributes to profit margin isn’t just its final selling price, but also its initial price.

There are two factors that have contributed the most to its low starting average psf. First and foremost, Bishan Loft is an executive condominium, which means that most of its prices are sold at a discount as compared to its condominium counterparts.

Executive Condominium Eligibility Source: HDB

This is because Executive Condominiums can only be sold to Singaporeans and Permanent Residents (PRs), and the Minimum Occupation Period (MOP) of five years has to be fulfilled, much like a Housing Development Board (HDB) flat.

We see this clearly when we compare the starting average price psf of Bishan Loft, an Executive Condominium, and Rafflesia, a condominium, both with similar characteristics. Bishan Loft saw a starting average psf of $440.80, while Rafflesia saw a starting average psf of$708.00

Secondly, the launch of Bishan Loft in 2001 occurred right when the property market was experiencing a slight downturn.

Private Residential Prices Source: Edgeprop

From the graph above, we can see that in 2001, property prices were slowly declining, and market outlook didn’t seem too optimistic. We can assume that Bishan Loft units were sold at a slightly lower average psf so as to attract more buyers during that period.

With these two factors in mind, we can see why the average starting psf of Bishan Loft units are considered low compared to its condominium counterparts, and other Executive Condominiums in Singapore.

## Conclusion

To sum up what we’ve mentioned in this article, we can conclude that demand and supply in a highly-sought estate or prime location has definitely been a key contributor to Bishan Loft’s continuously increasing average psf over the past 18 years. Moreover, when buying a property, taking into account the current stage in the property cycle is important as well: after all, buying at a low initial price contributes to an even greater profit margin in the future.

At Home Quarters, we take all these factors into account before we advise you on how to sell your property, or what property we believe you should buy. We’d be happy to provide you with various analyses, advice, and any sort of assistance you may require, whether you’re a buyer or a seller. Leave your contact details and any queries down below, and we’ll contact you ASAP.

Get the FREE Complete Checklist for you on the purchase of Executive Condominium!

We’d also love to hear your opinions on this article. Do you think there are any other reasons why Bishan Loft did so well? Or are there any other properties you know did very well too, and would like us to write about?

You can let us know through commenting on our YouTube that we did on this article, sending us a quick email, or hitting us up on our Facebook and Instagram pages to shoot us a quick direct message.

If you have questions or if you are thinking about properly showcasing your house for sale, whatsapp message or call KC from Home Quarters and begin finding your new home today: +65 8809 2889!

That’s all for this article! Stay safe, and remember, call Home Quarters and start packing!

## How to earn S$572,700 from Executive Condominiums (ECs) ? Singaporeans seem to have a deep-rooted belief that Executive Condominiums (ECs) almost always guarantee a profit. Unlike private condominiums, buyers are able to buy ECs at a considerably more affordable price than their private counterparts. Lilydale PHOTO: iproperty Coupled with the option of taking a Central Provision Fund (CPF) grant when buying the EC, many Singaporeans who are unable to buy BTOs or HDB flats because their incomes exceed the income ceiling. But aren’t too comfortable with spending an exorbitant sum on a condominium yet, eye ECs as potential goldmine investment properties. While that statement itself is debatable, Others have already published extremely detailed analyses on how realistic that belief is: what we want to do here is to go one step further by asking, for those who have decided to buy an EC while keeping in mind all the risks, when exactly should you sell your EC to maximize your profits? In this analysis, we’ll be breaking down 12 ECs that have launched, which have obtained their Temporary Occupation Period (TOP) between the years 2003 to 2013. Scroll down to take out quiz to find out your eligible! ### Here’s how the article is going to go: 1. We’ll present a table of these 12 ECs that show the average price per square foot (psf) of their early sales units, as well as the average price psf after 5 years, 10 years, and 15 years, where applicable. 2. We’ll then break down the data, and present their annual price appreciation percentage over the years, highlighting the key statistics of when their Minimum Occupation Periods (MOPs) have ended (5 years after the TOP date), and when the ECs have become fully privatized (10 years after the TOP date). From there, we’ll be able to see key similarities between the price appreciation of all the ECs. And from the trend, be able to conclude the peak average price appreciation for these 12 ECs. 3. Lastly, we’ll take a look at some ECs that have done either spectacularly well or badly, and speculate why these exceptions occurred. 4. We’ll conclude the article with when we believe you should sell your EC to maximize your profits. Without further ado, let’s start! ### 1. Average price per square feet of ECs over 15 years In this section, let’s take a look at how the average psf of ECs have changed since the sales of its early launch units, then at the 5-year, 10-year, and 15-year mark after it TOPs, where applicable. Average Price per Sqft of Executive Condominiums in the past 15 years The above table confirms a few things: firstly, ECs almost always guarantee profits, once sold after its initial MOP period has ended. There have been a few unprofitable transactions for ECs, but these occurred mostly for older ECs that aren’t on the list of 12 ECs that we’ll be analyzing today. We can see from the table though, that on average, even after 15 years, ECs can still be sold at a profitable price, assuming you bought an early sales unit. Another thing we observe is that the average psf continues to rise until about 10 years after the TOP period. With the exception of La Casa, whose average psf dropped by roughly 6.57%. At the 15-year mark though, we see that almost all of the average psf of ECs have dropped, with the exception of Bishan Loft and The Esparis. In summary, the table tells us this: based on the past data of these 12 ECs, ECs continue to be profitable even 15 years past its TOP date, provided you buy an early sales unit. Moreover, the average psf of ECs seem to peak around 10 years after its TOP date. Of course, the table above is just a super simple analysis and breakdown of EC data to draw out the above two conclusions. However, it’d be pretty obvious to most that, of course profits are going to continue to rise beyond the 5-year mark, and we’ve already seen that they usually peak around the 10-year mark; what we want to know is if this rise in profits is worth the wait. So, let’s go one step further. Let’s look at the real annual appreciation of all these ECs, and see how well they’re doing from year to year to find out exactly when their price appreciation stagnates and decreases. And based on past data, when exactly you should sell your house to fully maximize your profits. Scroll down to take out quiz to find out your eligible! ### 2. Annual percentage change in average psf of ECs First of all, you might be asking why this annual appreciation analysis is even necessary? Wouldn’t most simply want to know when the price of their unit peaks so they can sell it at the highest possible price to obtain the maximum profit? Well, you’re correct; most people would use the above method to obtain profit in hard cash. And use part of the money earned to upgrade to perhaps a bigger condominium, or even a large HDB flat. However, some people may prefer to sell their EC unit once it has hit its peak appreciation rate, rather than its peak price. This is so that they can use the money they have earned from the transaction to perhaps buy another property that can reap higher returns in the future, and have better price appreciation prospects. These people are likely either investors, or small families who do not mind moving around to gain the maximum returns from selling their properties. Still confused about this appreciation thing? Let’s take a look at Bishan Loft in hard numbers. Bishan Loft Average Price PSF We can see that it experienced the greatest appreciation of 24% between 2009 to 2010, with its average price psf increasing by about$158 from its previous year. From 2010 to 2009, although its average price psf increases still by about $144, this increase in price is less than that (by$14) of the previous year, and thus the price appreciation is only 18%.

Basically, an increase in the average price psf only guarantees that the price appreciation is a positive percentage. But does not necessarily mean that price appreciation has peaked. We hope this explanation makes things a little clearer for you!

With that out of the way, without further ado, let’s get into the analysis. Here’s the graph we’ll be looking at:

ECs Average PSF Appreciation

The line graph may be quite a bit to take in right now, so let’s break it down into two parts:

• Appreciation at the 5-year mark, when the property first MOPs (assuming you moved in right after it TOP’d);
• And the appreciation at the 10-year mark, when the property is first fully privatized.

From the get-go, we see two pretty obvious trends at the 5-year mark: One group of ECs see their price appreciation continue to increase between the 5-year mark until the 7-year mark, while another sees their price appreciation immediately drop after the 5-year mark has been reached.

For both groups though, the price appreciation generally never peaks again, with the exception of Park Green between Y13 and Y14.

While there are various factors and reasons that can account for this discrepancy, when we look at the overarching trend, we can basically conclude that peak appreciation rate is hit right when the property MOPs, until about 2 years after its MOP.

After that, from the data of the 12 ECs gathered above, we see the increase in the average psf of its units slowly decrease.

Let’s take a look at what was just said in a group bar chart format:

For the first five ECs in this list, we see the price appreciation peak in Y5

whereas for the next five ECs, the peak appreciation can be seen to peak around Y6.

In Y7, the price appreciation is still a positive percentage

but we can see that in Y10 and beyond, the average price psf mostly depreciates, or appreciates at a very low rate.

TLDR; the peak appreciation rate is reached on the year that the property MOPs, and within 1 year its MOP.

### 3.Analyzing another observable trend and one outlier

Another slightly less obvious trend we can observe is that some ECs see their price appreciation percentages slowly increase again at the 10 to 12-year mark. Let’s take a look:

This is just the zoomed-in version of the data, though – if you go back to the first line graph we presented, we can observe that this price appreciation is quite minimal compared to what it was around its MOP period.

The useful information we can draw from this graph, though, is that if the price of your EC has been steadily decreasing and you haven’t sold it yet, you may want to hold on to it for a little while longer until the Y10 to Y11 period, where the price of your unit just might increase by a little bit again.

This, however, is definitely not a one hundred percent guarantee (is there anything in the world that is?), and out of twelve ECs, we’ve only seen this trend in four – what we would advise you to do if this scenario applies to you, is to talk to us: leave your contact details down below and we’ll contact you shortly, help you thoroughly analyze the circumstances surrounding your EC unit, and recommend the best possible solution.

### Bishan Loft

One anomaly we’d like to bring to the table for discussion today is Bishan Loft, and in particular, how much its average price psf has increased over the past 15 years.

Its average price psf declined a little between 2014 and 2017, but bounced back in 2018 to $1129. When it first TOP-d, the average price psf of its early sales units was about$440.8.

That means that between 2003 and 2018, Bishan Loft saw a whopping 156% increase in average price psf. That’s a pretty insane profit margin, considering one square foot increased in price by about \$700 alone.

So what are some reasons as to why the average price psf of units in Bishan Loft shot up, and continues to rise even now?

We’ll be taking a look at that in our next article; stay tuned for that piece!

### Conclusion

To sum up the entire article, two conclusions can be made:

a. According to the data drawn from the past transactions of these 12 ECs mentioned above, the peak average psf is usually reached around 10 years after it TOPs, after which it declines, with Bishan Loft and The Esparis being the two exceptions to this conclusion.

b. Similarly, we see that the peak price psf appreciation is reached right after its MOP has been reached, and within 1 year after the MOP has been completed.

Therefore, here’s what Home Quarters recommends:

Regarding the first case, if you’ve bought the EC with the intention of upgrading to, for example, a condo or a larger HDB flat in a prime location, we’d highly recommend you to sell your EC after 10 years, as that’s when you’ll get the highest profit margin in hard cash as compared to other years.

Keep in mind, though, that this conclusion we have drawn is just based on data on these 12 years; we’ve already seen Bishan Loft and The Esparis as exceptions where their prices have continued to rise even at the 15-year mark, which means that the opposite can also hold true: the average psf of ECs may decline before the 10-year mark has been reached in the future.

With regards to the second case, if you’re a property investor or you’re willing to change properties often to achieve maximum returns, selling your unit the moment it MOPs or within 1 year of its MOP period would be best, as peak average price appreciation is reached around that period.

By selling your property at that period, you would be able to further invest the profit gained from that transaction into perhaps another property that may have higher returns than your EC unit in the next 5 to 10 years.

### Take out quiz to find out your eligible!

Answer the Questions below to find out when should you sell your EC!

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