EXECUTIVE CONDOMINIUMS IN THE RESALE MARKET

Abstract

The pioneer batch of six Executive Condominiums in Singapore will enter the resale market once they are semi-privatized in 2004. This study was conducted to forecast the resale value of the Executive Condominiums and to examine the resale factors that influence the resale value. The six resale factors that were investigated are capital appreciation potential, eligibility conditions and resale restrictions, tenure balance, physical depreciation, price of comparable private condominiums and price of new Executive Condominiums. From the survey of 434 potential sellers and buyers of Executive Condominiums, it was concluded that the resale Executive Condominiums are likely to be sold at a price of 1 to 5 per cent higher than their initial selling price. The one sample t test confirmed that all six resale factors have an impact on the resale value of Executive Condominiums. From the Pearson correlation analysis, it was revealed that all the resale factors other than the tenure balance factor have positive relationships with the resale value of Executive Condominiums. The ANOVA showed that there was no difference in opinions by both the potential sellers and buyers on the relative significance of the capital appreciation potential, eligibility conditions and resale restrictions, as well as the tenure balance on the resale value of Executive Condominiums. The stepwise multiple regression technique identified five resale factors and removed physical depreciation to predict the factors' influence on the resale value of Executive Condominiums. The findings from this study have concluded that the Executive Condominiums have the potential of achieving capital appreciation in value and measures to curb investment activities in the Executive Condominium market are also proposed.