Are executive condominiums increasingly out of reach for aspiring HDB upgraders?

Several years ago, as someone repeatedly unsuccessful in my applications for a Build-To-Order (BTO) flat, my then boyfriend and I considered an executive condominium instead.

We were nearing the income ceiling for BTO flats, so we assumed that an exec condo would be within reach. Then came the reality check.

Speaking to an agent for a new exec condo in Tampines, we were shocked to find out that the three-bedroom unit we were eyeing cost about $1.4 million – and we would need roughly half a million dollars in cash upfront to complete the transaction. So, we moved on and eventually bought a four-room resale HDB flat in the city fringe.

Today, with our five-year minimum occupation period (MOP) ending in two years, we briefly revisited the question most HDB owners ask themselves: stay put or upgrade?

Recent policy moves announced by National Development Minister Chee Hong Tat made the answer clearer: For many second-time buyers, upgrading to an exec condo may now be even further out of reach. The changes include a 10-year MOP for new exec condos, fewer units set aside for second-time buyers at launch, and most significantly, the removal of the deferred payment scheme.

Previously, buyers could pay a 20 per cent down payment and defer the remainder until the project obtains its temporary occupation permit, typically three to four years later.

But now, under the normal repayment scheme, all buyers must make progressive payments as construction milestones for the project are met. For HDB upgraders still servicing an existing mortgage, this substantially increases the financial hurdle when upgrading to an exec condo.

Taken together, the moves suggest an intention to discourage buyers from overgearing and prioritise first-time buyers. Yet, they also reveal a shift in Singapore’s housing policy – away from encouraging rapid upgrading and towards reinforcing the idea of housing as a long-term home first, and investment asset second.

Rising prices for exec condos

When exec condos were introduced in 1995, they were meant to help young middle-class couples who earned too much for subsidised public housing yet could not afford private condos. But over the years, exec condos evolved into something else – as a stepping stone for HDB upgraders with greater earning power seeking both lifestyle upgrade and capital appreciation.

Second-timer demand has surged. In 2020, about half the buyers of exec condos were second-timers. By 2024 and 2025, this proportion grew to between 60 per cent and 70 per cent.

At the same time, prices of exec condos have climbed rapidly. The median price of new exec condo units has surged by 120 per cent over the past decade, from $797 per sq ft (psf) in 2015 to $1,754 psf in 2025. Over the same period, median overall HDB resale flat prices grew 51 per cent from $400 psf to $604 psf.

Rising land, labour and construction costs are partly responsible. But strong upgrader demand has almost certainly contributed as well. The result? Exec condos increasingly require enormous upfront capital, at times pricing out first-time buyers.

Take this example: A household earning the maximum exec condo income ceiling of $16,000 would be eligible for about $930,000 to $1 million in housing loans. For a $1.4 million unit, buyers would still need about $500,000 on hand after accounting for the down payment, cash shortfall and stamp duties – a sizeable amount for a first-time buyer, especially one without parental financial help.

Seen in this light, the policy changes are not surprising. The Government is essentially signalling that exec condos should primarily serve first-time buyers priced out of private homes rather than function as a routine upgrader asset class.

Reducing the second-timer quota from 30 per cent to 10 per cent and significantly extending the priority window for first-timers from one month to two years – after which remaining units can be sold to all other buyers – are both aimed at restoring that purpose.

In theory, dampening and restricting upgrader demand may eventually push developers to moderate land bids and exec condo prices. But whether this translates into meaningfully cheaper exec condos remains to be seen.

Unlike Plus and Prime flats, buyers of exec condos receive far fewer subsidies, with eligible first-timers able to access only up to $30,000 in grants. If prices remain high, exec condos may increasingly favour buyers with family support or greater financial resources, reinforcing the role of intergenerational wealth. Some second-time buyers may also turn instead to larger or better-located resale HDB flats, potentially adding further upward pressure on the prices of those.

Striking a balance

The changes for exec condos mirror a broader evolution in Singapore’s housing policy. Flats are now classified as Standard, Plus or Prime under the new framework. Plus and Prime flats come with extra subsidies, stricter resale conditions such as a 10-year MOP and a subsidy clawback. This simultaneously prioritises affordability and long-term occupation over rapid gains from resale appreciation.

The message across these policies is increasingly consistent: homes are meant to be lived in, not flipped after five years for windfall profits. This does not mean that housing will cease to appreciate in value, but policymakers appear increasingly willing to trade off some upside in asset appreciation in exchange for greater affordability and stability. That may ultimately be healthier for the housing market.

For years, many Singaporeans have internalised the idea that upgrading property is a key pathway to retirement security. Buy a flat, upgrade after MOP, accumulate gains and eventually monetise the asset in old age. These aspirations and assumptions will have to be rethought.

Meanwhile, my husband and I have gradually come to terms with this reality ourselves. We have spent copious amounts of time and effort to make it a home we will live in for the next decade or so. Unless our life circumstances change, we are likely to stay put.

Even so, it is difficult not to feel a great sense of pity that an old pathway to wealth accumulation for the middle class is becoming increasingly out of reach.