Singapore's Housing Market Shows Resilience in Q1 Amid Policy Shifts and Global Uncertainties

The Singapore private residential market opened 2025 with a 0.8% quarterly price increase, marking a slight moderation from the prior quarter’s 2.3% surge but underscoring underlying resilience. This growth, driven by pent-up demand in undersupplied regions and strategic policy adjustments, comes as the city-state’s government works to balance affordability and market stability. However, headwinds from geopolitical risks and supply pipeline shifts mean investors must tread carefully.

Regional Dynamics: RCR Leads, CCR Struggles

The Rest of Central Region (RCR) emerged as the price growth engine, rising 1.7% quarter-on-quarter, fueled by new launches like The Orie in Toa Payoh—its $2,704/psf price setting benchmarks in a market starved of new supply. Meanwhile, the Core Central Region (CCR) grew just 0.6% q-o-q, hamstrung by limited new inventory and the 60% Additional Buyer’s Stamp Duty (ABSD) for foreign buyers.

In contrast, the Outside Central Region (OCR) saw a modest 0.3% q-o-q rise, as launches like Elta (Clementi) and Parktown Residence (Tampines) set new price benchmarks in undersupplied areas.

Sales and Rentals: A Shift Toward New Supply

Primary market sales dipped 2.6% q-o-q to 3,330 units, reflecting buyers’ preference for new launches over secondary homes. Flagship projects like Lentor Central Residence (93% sold at $2,200/psf) and The Orie (86% sold) dominated, while secondary market transactions collapsed 24% q-o-q, as buyers prioritized newer, better-priced units.

Rentals, however, showed mixed trends: non-landed RCR and OCR rents rose 1.7% and 2.2% q-o-q, respectively, driven by strong demand for rental housing. The Core Central Region, however, saw rents fall 1.6% q-o-q, a sign of weakening expat demand amid geopolitical uncertainty.

Policy Adjustments: A Multi-Pronged Approach

The Singapore government’s 2024 housing reforms—introducing Standard, Plus, and Prime housing categories—are bearing fruit. By tying subsidies and resale rules to location and amenities, the policy aims to cool speculation in prime areas while keeping affordability alive. For instance:
- Prime flats (e.g., near MRT stations) now require a 10-year Minimum Occupation Period (MOP) and face subsidy clawbacks, reducing flipping.
- Standard flats in less central areas have a 5-year MOP, easing access for first-time buyers.

These measures, combined with a 50,000-unit BTO pipeline through 2027 and 8,505 private GLS units, are expected to stabilize prices. However, the 15% q-o-q drop in private sales volume hints at lingering buyer caution amid global trade tensions and high mortgage rates.

Expert Outlook: Modest Growth Ahead

Analysts project 3–4% annual private price growth in 2025, down from 2024’s 3.9%. This cautious forecast reflects risks like:
- Global headwinds: Geopolitical friction could further dampen luxury demand (CCR prices grew just 0.6% q-o-q).
- Supply imbalances: Future launches skew toward CCR projects, which may struggle to match OCR/RCR sales volumes due to higher price points (e.g., Aurea at $3,005/psf).

Conclusion: A Market in Transition

Singapore’s housing market remains a study in contrasts. While OCR/RCR segments thrive on new supply and wealth-driven demand, the luxury CCR faces headwinds from policy and geopolitics. The government’s focus on expanding affordable housing—via BTOs and MOP reforms—appears to be working: HDB resale prices rose 1.6% q-o-q, and the price gap between public and private housing (309.5%) may deter speculative excess.

Investors should prioritize OCR/RCR developments with strong sell-through rates (e.g., Elta at 65%, Parktown at 87%) and avoid overleveraged developers exposed to CCR slowdowns. Meanwhile, HDB resale markets offer stability, with 19,500 flats expected to hit the resale pool by 2028—ensuring affordability for the masses.

The key risk remains global growth: if trade tensions ease and mortgage rates decline (projected to dip to 6.7% by late 2025), demand could rebound. For now, Singapore’s housing market is treading water—but its structural reforms give it a fighting chance to avoid a crash.

In short, the 0.8% Q1 rise isn’t a boom, but it’s a sign of resilience in a market learning to navigate uncertainty.