When contemplating an investment in a condo, it is essential to also examine its potential rental yield. Rental yield refers to the yearly rental income as a percentage of the condo’s purchase price. In Singapore, the rental yields for condos can vary greatly depending on factors such as location, property condition, and market demand. Typically, areas with high rental demand, like those near business districts or educational institutions, offer more favorable rental yields. To gain valuable insights into the rental potential of a specific condo, it is advisable to conduct thorough market research and seek guidance from real estate agents.
Experts Discuss the Outlook for Singapore’s Property Market – What You Need to Know
The recent announcement by the government that they are considering implementing more property cooling measures, along with the influx of upcoming housing supply from government land sale (GLS) sites and Build-To-Order (BTO) launches, as well as potential impacts from the Budget 2025 announcements, have sparked discussions about the future of Singapore’s real estate market. On Sunday, February 16, these were some of the main topics discussed at EdgeProp Singapore’s Property Market Outlook event.
The panel of experts included Alan Cheong, executive director of research and consultancy at Savills Singapore; Wong Xian Yang, head of research, Singapore and Southeast Asia at Cushman & Wakefield; and Song Seng Wun, Singapore economic advisor at CGS International. The panel was moderated by EdgeProp Singapore CEO Bernard Tong.
The event, organized by EdgeProp Singapore, took place at the preview of Elta, a new 501-unit project jointly developed by MCL Land and CSC Land Group. The sales gallery opened to the public on February 7.
New Property Cooling Measures and Upcoming Supply
In January, the government stated that they were open to implementing more property cooling measures and that it was not yet time to rollback on existing measures. This news comes as developers have seen a jump of 256% in year-on-year sales, with 1,083 new private residential units (excluding executive condos) sold last month.
According to Cheong, if new cooling measures are introduced, they are likely to be applied uniformly across the residential market. The panel also discussed the possibility of measures targeting the HDB resale market, which forms the “floor” of Singapore’s housing market. Wong pointed out that a surge in prices in the HDB resale market could put upward pressure on private housing prices, making it a potential target for cooling measures.
On the other hand, Tong highlighted the government’s plans to inject a strong supply of new housing through GLS and BTO, with the 1H2025 GLS program consisting of 10 Confirmed List sites that could yield 5,000 new homes, and HDB planning to offer 19,600 BTO flats in 2025.
Under the new BTO classification, newly launched Prime and Plus BTO flats will take about 14 years to enter the resale market, so their impact on prices will not be felt for some time, according to Cheong. Wong added that price trends in the resale market are more affected by project completions and HDB estates reaching their minimum occupation period (MOP) rather than the pipeline of GLS sites up for tender each year. “Project completions, rather than GLS supply, are more likely to affect prices,” he said.
Despite the potential for new cooling measures, all three experts noted that the recent successes in the new launch market show strong buyer confidence for projects launching this year. Elta saw about 4,500 visitors during its first three days of being open to the public, and other new launches this year, such as The Orie and Bagnall Haus, have experienced high selling rates of 86% and 63% respectively.
Budget 2025 and Its Potential Impact on the Property Market
The panel also discussed the potential impacts of the upcoming Budget 2025 announcements on the property market this year. According to Song, Singapore has seen a relatively strong economic recovery since the recession caused by the Covid-19 pandemic. With 2025 being an election year, he believes that Singaporeans can expect more handouts funded by government surpluses.
Questions from the Audience
During the Q&A session, some participants raised concerns about the current state of the residential property market, with some questioning whether it is in a “euphoric” phase. Cheong commented that the current exuberance in the market is likely to subside as developers carefully time the launch of new projects. He added that several upcoming projects are located in areas that have not seen a new launch in many years, leading to pent-up demand.
Rental Market and Upcoming Transformation Plans
The panel also took questions about the rental market, which has slowed since its peak two years ago. Cheong noted that while the total number of expatriates in Singapore has declined, there was an uptick in the volume of rental transactions in 2024. He explained that falling rents may have encouraged some renters to find their own accommodation instead of flat-sharing. However, this was offset by job layoffs in certain industries, which may moderate rental price growth this year.
During the Master Plan Master Class session, Tong covered upcoming transformation plans in Clementi and Jurong East. He noted that the completion of the second phase of the Cross Island Line (CRL) will add a new MRT station (West Coast) and turn the existing Clementi station into an interchange. “Historically, MRT interchanges have a positive impact on surrounding property prices,” Tong said.
Transformation plans in Clementi include the redevelopment of Clementi Stadium and the installation of more than 6.6km of cycling paths throughout the area. Demand for housing in Clementi is also expected to benefit from the progressive development of the Jurong Lake District and the creation of new jobs in the nearby Tuas megaport, Tuas Biomedical Park, Jurong Island, and Jurong Innovation District.
Data compiled by EdgeProp Singapore shows that the average age of existing condos in Clementi is around 17 years. Tong observed that recent new projects in the area have seen strong capital gains over the years, such as Elta’s neighboring project Clavon (24% increase since launch) and The Clement Canopy (43% price growth since launch). EdgeProp Singapore offers a suite of property tools that can help owners, buyers, and sellers understand market and price trends, including HDB resale prices, analytics of profitable transactions, and upcoming GLS sites.
In summary, the experts at EdgeProp Singapore’s Property Market Outlook event believe that new cooling measures, incoming housing supply, and potential impacts from the upcoming Budget 2025 announcements could affect the property market this year. However, strong demand for new launches and upcoming transformation plans suggest a positive outlook for the market.