Recently, a key signal emerged in Singapore’s property market—DBS Group revised its 2025 private home price growth forecast from 1%-2% down to 0%-1%, meaning “zero growth” is now the most conservative baseline. In a more pessimistic scenario, prices could even correct by up to 3%.
For potential buyers, is this trend a hidden opportunity or a reality check? Today, we break down the implications behind this property market warning from multiple angles.
Global Uncertainty Spilling Over into the Property Market
DBS Bank noted that the global economic slowdown, particularly unresolved U.S.-China trade tensions, is weakening corporate investment and hiring confidence. In Singapore, which heavily relies on trade and multinational companies, macroeconomic weakness inevitably impacts the property market—most visibly through increased buyer caution.
The report specifically warned that if Singapore enters a recession, private home prices could fall by up to 3%. While the drop isn’t drastic, it’s enough to give pause to buyers who had planned to “get in early.”
Price Growth Slows Sharply as Market Cools
According to Singapore’s Urban Redevelopment Authority (URA) Private Property Price Index (PPI), private home prices rose just 0.6% quarter-on-quarter in Q1 2025, a noticeable cooldown from the 2.3% growth in the previous quarter.
At the same time, market enthusiasm for new launches has waned. For example, two high-profile projects launched in April saw only 38% of units sold on their first weekend—far below the 60%-70% “frenzy” typical in earlier years.
Affordability Nears Historic Limits as Buying Pressure Rises
The report also highlighted a critical red flag for genuine homebuyers: while private home prices surged 33%-40% between 2020 and 2024, median household incomes grew only about 20% in the same period.
As a result, affordability has deteriorated. Data shows the average private home price-to-median-income ratio is expected to hit 14.6x, surpassing the 15-year average of 13.6x. This gap means housing pressure for ordinary families is nearing historic highs.
To Buy Now or Wait?
Faced with a market that’s “running out of steam,” many are torn: should they seize the moment or hold off?
Our take: Don’t let emotions drive the decision—focus on your actual needs.
If you’re buying for family stability, children’s education, or long-term living plans, the current “non-aggressive pricing” window offers a rational opportunity.
But if you’re investing, especially for short-term gains, caution is warranted given potential rental yield pressures.
