Singapore’s real estate market is showing promising signs of recovery in 2025, particularly within the industrial and residential sectors. Several key trends and events are shaping the investment landscape, offering opportunities and challenges for both local and international investors, especially impacting Singaporeans looking to buy and invest in property.
Residential Market Resilience
The residential property market in Singapore has demonstrated considerable resilience amid global economic uncertainties. According to the latest PropNex Research Residential Property Report, private home prices inched up by 0.6% quarter-on-quarter (QoQ) in Q1 2025, marking the second consecutive quarter of growth. This growth is significant, especially considering the potential trade tensions and economic headwinds faced by international markets.
- Price Trends: The Property Price Index for all private residential properties rose by 0.81% quarter-on-quarter and 3.33% year-on-year in Q1 2025, driven by new launches in fringe and suburban areas.
- Sales Volume: While the number of units sold in Q1 2025 declined slightly by 2.3% QoQ to 7,261, this figure represents a substantial 71.7% increase year-on-year.
- Expert Forecasts: CBRE forecasts a 3-4% increase in private residential property prices for the full year 2025, supported by low levels of unsold inventory and strong household balance sheets. PropNex offers a similar projection of 3% to 4% rise in private home prices for 2025.
The HDB resale market also continues to climb, albeit at a more measured pace. Flash estimates released by the Housing and Development Board (HDB) indicate that resale flat prices rose by 1.5% QoQ in Q1 2025. This marks the 20th consecutive quarter of price increases in the HDB resale segment, reaching a new high.
This upward trend in both private and public housing segments narrows the price gap, influencing upgrading decisions for many Singaporean families.
As of 2024, HDB units housed 77.4% of the country’s resident households.
Industrial Sector Stability and Growth
The industrial property market in Singapore has shown a stable performance in the first quarter of 2025, with prices and select rental segments continuing to rise. According to the ETC Singapore Digest, industrial property prices increased by 1.5% QoQ, supported by a 1.9% rise in multiple-user factory prices.
- Occupancy Rates: Island-wide industrial occupancy held steady at 89.0%. Multiple-user factories saw improved occupancy at 91.3%, while warehouse/logistics and business parks recorded slight declines.
- Rental Rates: Rental rates for warehouse and logistics space edged up by 0.3%, reaching $1.88 per square foot.
- New Supply: About 6.4 million sq ft of new industrial space is expected over the next three quarters, with warehouses, multiple-user factories, and business parks making up a significant portion.
The industrial sector’s resilience is further supported by steady economic growth, with Singapore’s economy anticipated to grow by 1.0%-3.0% year-on-year in 2025. The manufacturing sector is also poised to expand, albeit at a slower pace.
Luxury Market Rebound
Singapore’s luxury property market has recorded a sharp rebound in the first quarter of 2025. Total transaction value for private homes priced above $5 million in the Core Central Region (CCR) rose 44.6% QoQ to $1.37 billion, according to OrangeTee & Tie’s Luxury Market Report Q1 2025.
- Transaction Volume: The number of transactions in this segment climbed significantly, reaching 143 units in Q1 2025, up 43% from the previous quarter.
- Resale Dominance: Resale transactions made up the majority, with 119 units, followed by 23 new sales and one sub-sale.
- Super Luxury Segment: The surge in luxury sales extended to the super-luxury segment, with 17 condominium units in CCR sold for over $10 million in Q1 2025.
Factors Influencing the Market
Several factors are contributing to the current trends in Singapore’s real estate market:
- Interest Rates: Easing interest rates are improving buyer sentiment, though they remain above pre-2022 levels. Fixed home loan interest rates have dipped below 3%, a welcome change from previous highs.
- Government Policies: The government continues to manage market stability through cooling measures and controlled land supply, ensuring sustainable price growth. The government maintains high land supply with 2H 2025 GLS launch
- Housing Supply: Increased housing supply, including BTO flats and private housing units, is creating a more balanced market environment and moderating price growth.
- Economic Conditions: While the global economy faces uncertainties, Singapore’s strong economic fundamentals and political stability continue to attract investors.
Impact on Singaporeans
The changes in the real estate market directly affect Singaporeans in several ways:
- Affordability: With HDB resale prices and private home prices on the rise, affordability remains a key concern for Singaporean families. The government’s efforts to increase housing supply and provide grants aim to alleviate this issue.
- Investment Opportunities: The resilient property market offers investment opportunities for Singaporeans looking to grow their wealth. However, careful consideration of market trends and long-term investment potential is crucial.
- Housing Decisions: Changes to CPF policies, such as the closure of the Special Account for those aged 55 and above, influence housing decisions, particularly for older homeowners.
Conclusion
Singapore’s real estate market in 2025 presents a mixed bag of opportunities and challenges. The rebound in the industrial and residential sectors, coupled with government initiatives and economic stability, creates a positive outlook. However, potential risks such as global economic uncertainties and rising construction costs must be carefully considered. For Singaporeans, staying informed and making well-calculated decisions will be key to navigating this dynamic landscape successfully.
