Singapore’s Property Market Navigates Cooling Measures and Shifting Demand
Singapore’s real estate market remains a key area of interest for Singaporeans, navigating a complex landscape of cooling measures and evolving buyer sentiment. Recent data reveals a market in transition, with prices showing signs of stabilization amidst both challenges and opportunities.
Cooling Measures and Their Impact
Since 2009, the Singapore government has implemented at least 15 rounds of cooling measures to regulate the property market and prevent it from overheating. These measures, including the Additional Buyer’s Stamp Duty (ABSD) and stricter Loan-to-Value (LTV) limits, aim to control property prices and curb speculative activity. In April 2023, ABSD rates experienced a steep hike, impacting foreign investors and those purchasing second or subsequent properties. Transactions involving foreign buyers in the Core Central Region (CCR) and luxury segment plummeted drastically following this change.
Cooling measures have both upsides and downsides. They help curb the risk of overpaying and make homeownership more accessible for lower- and middle-income families. However, they also raise upfront costs for upgraders and seasoned investors, potentially slowing sales and increasing financial pressure on developers. Despite these challenges, cooling measures ensure housing remains within reach for the average Singaporean and prevent housing bubbles, contributing to long-term economic stability.
The latest change in HDB rules has reduced the LTV limit for HDB housing loans from 80 per cent to 75 per cent. While this may dampen demand in the short term, particularly for resale flats, analysts expect demand and prices to continue to rise over time.
Private Residential Market Trends in 2025
The private housing market in Singapore is settling into a new equilibrium, with prices stabilizing despite continued buying momentum. According to the Urban Redevelopment Authority of Singapore (URA), the Property Price Index for all private residential properties rose by 0.81% quarter-on-quarter and 3.33% year-on-year in the first quarter of 2025. This growth was largely driven by new launches in fringe and suburban areas.
- Non-landed properties (strata-titled private condominiums) led the price growth, registering a 0.95% quarter-on-quarter increase.
- Landed properties saw a quarter-on-quarter increase of 0.38%, recovering from a previous decline.
Private home sales gained pace due to lower mortgage rates and supply-led momentum. While the number of units sold in Q1 2025 declined slightly by 2.3% quarter-on-quarter to 7,261, this represented a substantial 71.7% increase year-on-year. New private homes sold totaled 3,375 units in Q1 2025, a marginal 1.32% decline from the previous quarter but almost tripling the units sold in Q1 2024.
Regional Performance: OCR Leads the Way
A majority of new launches (73%) were located in the Outside Central Region (OCR), with the Rest of Central Region (RCR) accounting for 25% and the Core Central Region (CCR) comprising the remaining 2%. Activity in the OCR increased sharply, rising by 72.5% to 2,284 units in Q1 2025. The total unsold inventory of private residential units fell by 6.81% quarter-on-quarter to 18,270 units.
Breaking down the regional performance further:
- CCR resale prices rose by approximately 1.7% in Q4 2024, reaching around $2,215 per square foot.
- RCR saw no change in Q4 2024, but the biggest increase at +1.7% in Q1 2025, hitting $1,896 PSF.
- OCR gained 2.4% in Q4 2024 and experienced a growth of +1.3% in Q1 2025, reaching $1,545 PSF.
HDB Resale Market and Million-Dollar Flats
While the primary market flourished, the resale segment experienced moderate sales activity in Q1 2025. Approximately 3,158 units changed hands in the resale market, a 14.7% decrease from the previous quarter. Despite the slower pace, the million-dollar HDB resale segment set new sales records, with 348 resale flats fetching at least $1 million – a new quarterly high.
Singapore’s public housing resale prices rose 9.6% in 2024, highlighting housing affordability as a key issue for many Singaporeans.
Looking Ahead: Opportunities and Challenges
GDP is expected to grow at 1–3% in 2025, slower than 2024’s 4.0% year-on-year growth. Challenges include protectionist policies, slower growth among key trading partners, and geopolitical tensions. However, growth momentum from the manufacturing sector recovery is expected to sustain into early 2025, and labour market conditions should remain stable. Buying sentiment and appetite have improved amid lower mortgage rates, and developers are likely to push ahead with launches in 2025.
Singapore ranks among the top investment destinations in APAC in 2025, and transaction volumes should continue to recover amid expected rate cuts. Investors are expected to be selective, focusing on quality assets and sustainable investments.
While rents are likely to remain under pressure in the near term, the market is showing signs of stabilisation. Retailers’ expansionary appetite is expected to remain strong, and expectations of a full tourism recovery should support retail rents.
The Singapore property market presents a mix of challenges and opportunities. Cooling measures are in place to maintain stability and affordability, while the private residential market shows signs of resilience and growth, particularly in the OCR. Understanding these trends is crucial for Singaporeans looking to navigate the property landscape and make informed decisions.
