2025 Singapore Real Estate Market In-depth Observation: Macro Environment, Policy Regulation, and Foreign Buyer Motivations

In the third quarter of 2025, Singapore's GDP grew by 4.2% year-on-year and 2.4% quarter-on-quarter, showing a strong recovery momentum. The full-year GDP forecast has been revised up to approximately 4.0%. Core inflation remains between 0.3% and 0.4%, with CPI at only 0.7%, and monetary policy remains neutral to accommodative. The resident unemployment rate is about 2.8%, and the citizen unemployment rate is 3.0%, still at low levels. Overall, the economy is stable, inflation is moderate, and employment is good, providing fundamental support for the real estate market.

Moderate inflation weakens the anti-inflation motivation for home purchases, while high interest rates limit leveraged buying. Global trade risks (such as U.S.-China friction) increase buyer hesitation, but low unemployment and stable income support owner-occupier demand. Actual borrowing costs remain high, leading to a significant cooling in investment demand. Overall, economic stability promotes rigid demand for housing, but investment demand is more constrained by policies and credit conditions.

The government continues its stabilization strategy, addressing through land supply, stamp duties, and loan regulations in three key areas:
- Land Supply: In the second half of 2025, 4,725 units were launched, with nearly 9,800 units for the full year, maintaining high supply to stabilize prices.
- Stamp Duty Policies: The Additional Buyer's Stamp Duty (ABSD) for foreign buyers remains at 60%, starting at 20% for Singaporean citizens' second homes. From March, the ABSD remission period for developer projects is extended by 6–12 months.
- Seller's Stamp Duty (SSD): Starting in July, the holding period is restored to 4 years, with rates increased by 4 percentage points across all tiers to prevent short-term speculation.
- Loan Regulations: The Total Debt Servicing Ratio (TDSR) remains at 55%, with a minimum interest rate of 4%, maintaining strict credit standards.

In the third quarter of 2025, new project sales reached 3,238 units, a year-on-year increase of 174%; in October alone, 2,424 units were transacted, setting a new high for the year. The Core Central Region (CCR) sold 894 units, the highest quarterly sales in 15 years. The RCR and OCR regions contributed more than half of the transactions, indicating that mid-range and mass-market projects have become the main drivers.

In October, only 753 second-hand private homes were transacted, a month-on-month decrease of 35.3%, hitting a 16-month low. Resale HDB flats also dropped to their lowest point since 2020, falling 38.4% month-on-month, with prices down 0.6%. Buyer hesitation, diversion to new projects, and loan pressure collectively contributed to the market's weakness.

Foreign buyers accounted for only about 1.3% of new launches in the first three quarters of 2025, a significant drop from 4–7% in 2018–2021. In the resale market, the foreign share was only 1.4%. The high ABSD rate of up to 60% has almost eliminated short-term investors, and market dominance has returned to local buyers.

The market is shifting from a seller's to a buyer's market. Ample supply and higher interest rates have slowed the pace of transactions, giving buyers more choices. Competition among new projects has intensified, with developers using discounts and promotions to maintain sales momentum; the secondary market is entering a period of price rebalancing.