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Is the Property Market in Singapore Finally Stabilising?

The Singapore property market has seen considerable fluctuations over the past few years. From rapid price increases to cooling measures implemented by the government, real estate trends have been anything but predictable. However, 2025 might mark a turning point as signs indicate that the market could finally be stabilising. In this article, we’ll dive into the current state of the market, the factors contributing to stabilisation, and what this means for property agents and investors in Singapore.

Current Market Trends

In recent months, the property market in Singapore has shown a trend of moderate growth. Residential property prices, while still on the rise, are no longer experiencing the meteoric increases witnessed during the pandemic’s peak. According to the latest data from the Urban Redevelopment Authority (URA) [Source: URA Monthly Statistics], property price growth has slowed down, with some segments seeing a decline or plateau in prices.

For example, the private residential market, including condominiums and landed properties, has seen more tempered increases in pricing. HDB resale prices, after reaching record highs, have also levelled off, showing signs of a more balanced market [Source: HDB Resale Price Index].

This slowing of growth, combined with a reduced number of speculative buyers, indicates that the market is entering a phase of stabilisation. But what exactly is driving this trend?

Factors Contributing to Market Stabilisation

1. Government Cooling Measures

Singapore's government has consistently implemented cooling measures to prevent the property market from overheating. Measures such as higher stamp duties on second and subsequent property purchases, tighter loan-to-value (LTV) ratios, and restrictions on foreign ownership of residential properties have contributed to the market's cooling. These policies have led to a reduction in speculative demand and created a more sustainable environment for long-term growth [Source: Singapore Government Cooling Measures – Ministry of Finance].

2. Rising Interest Rates

With interest rates on the rise globally, the cost of borrowing has increased. In Singapore, this has made mortgages less affordable for some buyers, leading to fewer high-leverage investments. Higher borrowing costs tend to cool down the market, especially when homebuyers are more cautious about taking on large amounts of debt. As reported by the Monetary Authority of Singapore (MAS), the rise in interest rates is impacting buyers’ purchasing power [Source: MAS Monetary Policy Report].

3. Reduced Investor Sentiment

The influx of investors, particularly foreign buyers, that characterised the boom years of the past decade has slowed. Government measures, coupled with the rising interest rates and global economic uncertainties, have caused many investors to become more selective in their property purchases. As a result, the market is seeing more owner-occupiers and less speculative buying [Source: Real Estate Developers Association of Singapore (REDAS)].

4. Supply & Demand Balance

The increased supply of new residential units in Singapore, with upcoming launches from major developers, is helping meet the demand from potential buyers. This greater availability has created a more balanced supply-demand dynamic, preventing the kind of sharp price increases seen in previous years [Source: URA Development Forecast].

5. Stronger Economic Outlook

While global markets remain unpredictable, Singapore's economic resilience has been a factor in stabilising the property market. The country has seen steady GDP growth, low unemployment, and a strong currency, all of which contribute to a more confident and stable market. This economic stability has reinforced buyer confidence, which is essential for a well-balanced real estate market. According to the Ministry of Trade and Industry (MTI), Singapore's GDP growth has been on a stable upward trajectory despite global uncertainties [Source: Ministry of Trade and Industry Singapore].

What Does This Mean for Property Agents?

For property agents, a stabilised market presents both challenges and opportunities. Here’s how to navigate it:

1. Focus on Value and Expertise

In a stable market, property buyers and sellers are more likely to seek agents who offer in-depth knowledge of the market, value-driven advice, and accurate pricing strategies. Property agents should focus on building a reputation as trusted advisors and work with clients to determine fair market prices based on current trends.

2. Adapt to Changing Buyer Preferences

Buyers are becoming more cautious, so they may be less likely to make impulsive purchases. Property agents will need to focus on helping buyers make informed decisions based on long-term value rather than the immediate appeal of rising prices. Educating clients on factors such as rental yield, future developments, and the long-term stability of different neighbourhoods will be critical.

3. Targeting Resale HDB Market

As the resale HDB market shows signs of slowing, agents specialising in HDB transactions can capitalise on the increasing demand for more affordable housing options. Given the rise in interest rates, many buyers are returning to HDB resale flats as a more accessible option compared to private properties.

4. Increase in Negotiation Skills

With fewer "hot" listings, negotiations are likely to become more complex. Property agents who excel at negotiation will be in high demand as buyers and sellers look for deals that make sense for their budgets. Offering clients market analyses and helping them navigate price adjustments will be key in closing deals.

What Does This Mean for Investors?

For investors, a stabilised market offers opportunities for long-term gains with less risk of market volatility. Here’s how they can approach this phase:

1. Focus on Long-Term Value

With a cooling market, the days of high returns from quick flips may be behind us. Investors should look for properties with long-term value and focus on assets that are likely to appreciate steadily over time. Real estate in up-and-coming areas, near public transport or future development projects, is an example of smart investment in a stable market.

2. Consider Rental Yields

With the property prices stabilising, rental yields are becoming a more important consideration. Investors may want to focus on properties that will provide steady rental income, especially with Singapore’s growing population and the potential for a continued demand for rental properties.

3. Diversification

The current market may favour diversification, especially with the rise in interest rates. Investors should consider diversifying their portfolios across residential, commercial, and industrial properties to hedge against potential risks.

Conclusion

While the Singapore property market has not fully “cooled” in terms of pricing across all sectors, the signs of stabilisation are clear. The combination of government interventions, rising interest rates, and a stronger economic outlook are helping to create a more balanced and sustainable market. For property agents, this is an opportunity to focus on value-driven services, provide accurate market insights, and navigate more informed buyer and seller decisions.

Ultimately, the stabilisation of the market in Singapore may lead to a more sustainable real estate landscape in the years ahead, with steady growth, more cautious buyers, and a focus on long-term investments. Whether you’re a buyer, seller, agent, or investor, staying informed and adapting to these changes will be key to success in the current property climate.