Private residential market splits between pricing strength and softer deal activity

Middle East tensions and rising costs drive a shift to selective, high-quality assets.

Singapore’s private residential market is showing a widening gap between resilient pricing and weakening transaction momentum, as buyers become more cautious amid macroeconomic uncertainty and geopolitical risks, analysts said.

Tricia Song, head of research for Singapore and Southeast Asia at CBRE, noted that price gains were supported by strong take-up at selected new launches, particularly in the Outside Central Region, where benchmark pricing and demand for well-located projects helped offset weakness in other segments.

However, transaction activity has become more subdued, with volumes falling sharply from previous quarters despite continued buyer interest in quality projects.

“Whilst homebuying sentiment and appetite have been resilient so far amidst low mortgage rates and steady household income growth, a protracted Middle East conflict may increase caution among homebuyers, who could become more discerning in their purchase decisions, especially given inflationary pressures from higher fuel and food prices. Competitive and realistic developer pricing will be critical,” Song said.

Huttons similarly pointed to a cooling in transaction volumes across both new sales and resale segments, even as the market absorbed several major launches. It highlighted that whilst buyer confidence remains present, activity is increasingly sensitive to timing and external uncertainty, particularly following the escalation of geopolitical tensions in the Middle East.

Christine Sun, chief researcher & strategist at Realion (OrangeTee & ETC) Group, described a more pronounced slowdown in market activity, with declines across new sales, resale transactions, and executive condominium demand.

Sun attributed this to macroeconomic uncertainty, more cautious sentiment, and early signs of rising mortgage rates, which are prompting buyers to reassess purchasing decisions more carefully.

Despite the softer transactional environment, analysts noted that pricing has remained relatively resilient, supported by well-received launches in both suburban and prime segments.

Strong take-up in selected projects was repeatedly cited as evidence that demand has not disappeared, but is becoming more concentrated around specific developments that meet buyer expectations on pricing and location.

At the same time, the resale market showed clearer signs of hesitation, with some buyers and sellers delaying decisions amid uncertainty. However, analysts framed this not as a structural downturn, but as a short-term response to external volatility.

On the rental side, performance remained stable to slightly positive. Broader macroeconomic conditions, including hiring trends and corporate expansion plans, could influence future demand, particularly in the expatriate segment.

Analysts predict overall price growth to remain moderate, between 2% to 4.5%