Dynamic Shift in Property Markets: Soaring EC Prices and Bids Contrast with Declining Trends in Private Properties

In the wake of the recent harmonisation of Gross Floor Area (GFA) definitions, a notable trend has emerged in the Government Land Sales (GLS) landscape. Developers, in response to the changes in GFA calculations, are now submitting lower bids for land.

The decline in land prices is primarily attributed to a significant shift predating GFA adjustments. Previously, developers had the flexibility to construct “free” aircon ledges and curtain walls, which were excluded from GFA calculations. These elements constituted around 4% to 5% (air con ledges) and 1% to 2% (curtain walls) of the total saleable area in private condo developments. However, with the harmonisation of GFA definitions from June 1, 2023, all strata areas, including air con ledges and curtain walls, are now considered in GFA calculations and, consequently, in the saleable area presented to homebuyers. As developers must now account for the full 7% of “free space” within GFA, they have to adjust land bid prices downward by 6.5% in order to maintain profit margins.

Even with the recalculated reduced land bid prices, there is a noticeable downward trend in land bid prices for private residential land, exemplified by land bids in the Lentor area where the land bid price has witnessed a substantial decrease from $1,132 per square foot per plot ratio (psf ppr) to the most recent figure of $982 psf ppr.

Source: URA

Furthermore, an interesting trend is emerging in the bidding landscape for land parcels in the Lentor area. Notably, there’s a discernible decrease in the number of bids for Lentor land parcels, a trend that aligns with a broader pattern seen in the GLS program.

Source: URA

The data extracted from the URA website reveals that between 2020 and the end of 2021, GLS auctions predominantly attracted 5 to 10 bids. However, a significant shift occurred from 2022 onward, with bid numbers reducing to a range of 1 to 5 bids.

Developers are adopting a cautious stance amidst a decline in bid activity. This trend may be attributed to various factors, including recent regulatory adjustments such as cooling measures, and broader economic uncertainties marked by high interest rates and construction costs.

Furthermore, the anticipation of more land parcels being released in 2024 introduces an element of future supply, potentially influencing developers to hold back on bidding.

Contrasting Trend for Executive Condominiums (ECs) 

On October 9, 2023, the Sim Lian Group secured the coveted Tampines Street 62 land parcel B with a record-breaking land bid price of $543 million. This translates to an impressive $721 psf ppr, surpassing the previous high set by the Plantation Close land parcel which has a winning bid of $703 psf ppr and awarded to Hoi Hup Realty Pte Ltd and Sunway Developments Pte. Ltd. on September 11, 2023.

Source: URA

Source: HDB

Land bid prices are shooting up, with the latest two transactions hitting record-breaking highs at $703 psf ppr and $721 psf ppr. This surge in prices underscores the heightened interest among developers in EC government land sales.

Another intriguing trend emerges when examining the bidding activity for ECs in comparison to non-landed private residential land parcels. The data indicates a substantial difference, with ECs consistently attracting an average of 7 to 9 bids, a significantly higher figure than the current average of 1 to 5 bids for URA GLS.

Source: HDB

The strategic appeal of ECs as a safer investment as it has a reliable pool of buyers evidently drove this increased enthusiasm from developers. These record-breaking land bid prices as well as high number of bids signify a bullish market sentiment and highlight the growing significance of EC projects in the real estate landscape.

This is further reinforced by the fact that Copen Grand EC fully sold out within one month of its launch on 22 October, 2022. Meanwhile, another popular EC project, Altura, sold 88% of its units during its second-timer balloting event.

The rising land bid prices for EC raise concerns about future affordability for homebuyers, especially the “sandwich class”, whose income exceed the income ceiling for BTO flats but finds private properties unaffordable. To assess this, let’s conduct a price gap analysis.

Price Gap Analysis

Source: URA

From the graph above, a notable trend emerges as we compare the median price of a new 99-year leasehold non-landed private residential properties in the Outside Central Region (OCR) to that of newly launched ECs. Specifically, the observed price gap is substantial, approximately $664 psf.

This considerable price differential implies that ECs still remains as a very affordable option when compared to private properties. Furthermore, it suggests immense potential for substantial capital appreciation in newly launched ECs.

Moreover, the small difference in price between a newly launched EC and a resale non-landed private residential unit further enhances the appeal of choosing a new EC over an older resale unit. 


In summary, a forecast for the future suggests a continued upward trajectory in bid prices for ECs, with EC GLS highly coveted among developers as reflected by the high number of bids. This is primarily fueled by the robust consumer demand for ECs, driven by their attractive features and affordability.

In contrast, the outlook for URA GLS appears less optimistic, given the prevailing high-interest rate environment, absence of subsidies, and elevated property prices. These factors collectively have the potential to dampen demand for private residential land, highlighting the divergent dynamics shaping the landscape of property acquisition and development in the current real estate climate.

For novice property investors, despite the increasing land bid prices, ECs continue to offer a more affordable entry point compared to private properties. This affordability trend is likely to persist in the foreseeable future.