Muted momentum, stable demand in luxury homes in wake of ABSD hikes 

[SINGAPORE] Analysts are cautiously optimistic that Singapore’s prime housing market may pick up this year, with signs of improving sales after a sluggish two years since stamp duty rates were raised in April 2023. 

Caveats data showed that prior to the hike in Additional Buyer’s Stamp Duty (ABSD) in the first quarter of 2023, there were 1,027 transactions for non-landed residential properties in the Core Central Region (CCR).

CCR non-landed sales subsequently fell to 922 deals in the second quarter of 2023 and slowed further to an average of 678 transactions per quarter from Q3 2023 to Q4 2024, said Chia Siew Chuin, JLL head of residential research, research and consultancy.

JLL statistics showed that sales of luxury condominiums and private apartments worth at least S$5 million in Singapore’s prime region plunged from 128 deals totalling S$990.3 million in Q1 2023, to an average of 75 transactions worth S$576.5 million per quarter between Q2 2023 and Q4 2024. 

This figure – comprising deals in both the primary and secondary market – saw a slight increase in Q1 2025 to 84 transactions valued at S$676.1 million, Chia noted. The total number of caveats lodged in Q1 also inched up to 728.

She attributed the slight recovery to improvements in market confidence, buoyed by a stronger economic performance, moderation in interest rates and healthy balance sheets.

While foreign buying shrank with higher ABSD rates, wealthy local buyers are still in the market.

There were 14 foreign buyers of new condos in the CCR in Q1 2025, a far cry from the 92 in Q1 2023, before the government increased ABSD rates. 

Including resales and sub-sales in the CCR, foreigners accounted for 4 per cent of buyers out of the 733 transactions recorded in Q1 2025. In Q1 2023, this group made up nearly 16 per cent of buyers, out of 1,027 transactions in total. 

Chia noted that local residents acccounted for 55.5 per cent of total sales in Q1 2023, with 30.5 per cent being Singaporeans and 25 per cent being permanent residents. By Q1 2025, the proportion of Singaporean buyers rose to 53.6 per cent and permanent residents to 36.9 per cent.

“These trends show that while policy and market challenges have subdued activity from foreign ultra-high-net-worth individuals (UHNWIs), local wealthy buyers have stepped in,” said Chia. “This shift underscores the resilience of the prime residential market and the continued confidence of local HNWIs in Singapore’s prime residential market.”

Sentiment may be improving, but sales are still a far cry from before. Knight Frank data showed that the second half of 2024 had just 80 prime non-landed home sales totalling S$573.7 million. This was down 27 per cent from the previous half-year’s S$787.4 million in 104 deals.

For the whole of 2024, S$1.4 billion worth of prime non-landed private homes changed hands, down from S$1.7 billion in 2023. 

Knight Frank defines prime non-landed homes as properties with floor area of at least 2,500 square feet in districts 1, 2, 4, 9, 10 and 11. 

Last year also saw the lowest number of prime home sales recorded at 184, compared with 298 deals in 2022 and 206 deals in 2023. 

Demand remained sluggish in the first quarter, OrangeTee Group’s chief researcher and strategist Christine Sun noted – only six new non-landed homes in the CCR changed hands for more than S$10 million, and 13 sales were transacted between S$5 million and S$10 million. 

In comparison, during Q1 2023, four new non-landed homes in the CCR were sold for more than S$10 million, and 41 sales closed between S$5 million and S$10 million. 

“Against the backdrop of cooling measures and economic headwinds, demand for prime homes remains patient but will act should a suitable property surface,” Knight Frank head of residential and private office Nicholas Keong added.

Even so, JLL’s Chia said the measured price appreciation in the CCR suggested a “stable rather than surging market”.