Updated: Mar 23
Like all HDB regulated properties, an EC can only be put on the open market after you have met the five-year Minimum Occupancy Period (MOP).
So now that you’ve gotten there, what’s next?
Is it time to sell and reinvest in another property, or hold on?
Here’s how i would approach this topic rationally:
1st, you need to be clear why you would sell right after MOP, instead of after privatisation of the EC at the 10th year mark.
1. Is it the herd instinct of following your neighbours who are cashing out that's influencing you?
2. Are you afraid that you can no longer realise your profits in the future?
3. Or are you looking for a way to realise the gains immediately and recycle your profits into another higher potential investment property?
A brief walk down memory lane
When ECs first emerged on the market in 1999 (Eastvale in Pasir Ris from $300+K!), the common consensus was that owners should wait until the development fully privatised (after the 10th year) before cashing out their profits for maximum gains.
Today however, it’s increasingly common to see owners selling soon after MOP, to realise and recycle their profits earlier into 2 or more properties.
Here are some points to consider before you make your decision.
5 Points To Consider Before Selling Your EC After MOP
1. How many units are selling in your EC?
2. What is the current supply situation of newly TOP (Temporary Occupation Permit) condominiums in your area?
3. Are there significant infrastructure growth plans in your neighbourhood?
4. Is your next property purchase likely to offer better returns?
5. Are you in an economic downturn?
1. How many units in your EC are selling at the moment?
Generally when an EC reaches MOP, many owners start looking to cash out.
Some cash out to upgrade to a bigger place as their salaries have increased since 8-9 years ago since balloting for the unit.
Some cash out and downgrade back to a HDB flat and fully pay it off with the profits they earn.