New survey data shows that Singaporeans prefer property over equities, bonds, and other asset classes—even as home prices hit record highs and interest rates stay elevated. But with shifting market forces in 2025, is property still the superior wealth-building tool?
According to the ERA–Ngee Ann Polytechnic My Dream Home Survey 2025, over 64% of Singaporeans rank real estate as their preferred investment asset, far surpassing equities, fixed deposits, bonds, commodities, and crypto.
This inclination is deeply rooted in both cultural mindset and past experience. Property in Singapore has historically held its value well, supported by political stability, limited land supply, prudent regulations, and strong long-term demand.
Yet what’s notable is not that Singaporeans prefer property, but that preference persists despite substantial financial headwinds.
The survey shows:
- 54–59% of condo buyers expect to spend S$1–2 million
- Around 20% are prepared to go up to S$3 million
- BTO buyers remain price-sensitive, mostly staying between S$500,000 and S$1 million
- 6% of resale HDB buyers are willing to spend S$1–2 million for central or newer flats
Even landed homes see strong aspiration, with 3 in 4 buyers planning to spend over S$3 million.
In almost any other market, such numbers would dampen sentiment. But in Singapore, the belief in property as a stable store of value remains remarkably resilient.
But Rising Costs Are Changing the Realities of Homeownership
Despite strong demand, the road to buying a home is growing more challenging.
Affordability is the biggest issue. Mortgage rates have doubled from their pre-2022 lows, and homebuyers today face significantly higher monthly instalments. The Monetary Authority of Singapore (MAS) has flagged that mortgage servicing ratios have widened again, especially for younger families.
The ERA survey confirms this sentiment: affordability and rising borrowing costs are among the top concerns for prospective buyers.
At the same time, policy measures like ABSD and property taxes continue to play a key role in shaping demand.
- 32% of respondents say ABSD is a major deterrent, stopping them from buying a second investment property.
- Higher property taxes, introduced from 2023 onwards, reduce rental yields and increase holding costs.
This environment has contributed to a softening in some segments. Cushman & Wakefield’s Q3 data showed a notable increase in loss-making resale transactions, including a large transaction that resulted in a 14.2% annualised loss over just over three years.
While this does not represent the broader property market, it suggests that the once-assumed “always-profits” narrative is no longer universal.
What Does This Mean for Singapore’s Property Market Outlook in 2025?
The latest findings point to a property market that is still underpinned by strong fundamentals, but with several emerging stabilisers that may moderate price growth.
1. Price growth is likely to stabilise, not surge
Demand remains resilient, but affordability limits how much higher prices can realistically climb. Wage growth is slowing, interest rates remain elevated, and new supply is gradually normalising. These factors collectively put a natural ceiling on price acceleration.
2. Investment demand may cool further
With ABSD remaining high and property taxes rising, investment buyers may remain on the sidelines. Rental yields, already compressed, are unlikely to offset the higher cost of property ownership for many.
3. Upgrader demand remains strong, but more spaced out
Upgrading aspirations are still high, but income growth and savings accumulation are not keeping pace with rising prices. This delays upgrading cycles and tempers immediate demand.
4. Location and convenience remain key
Transport connectivity and proximity to amenities remain the top buying criteria. These structural preferences anchor demand in well-located areas, even during periods of softer sentiment.
Overall, property remains a solid long-term asset, but investors should temper expectations. The coming year is more likely to bring stable prices and slower growth, rather than the strong appreciation of the past decade.
How Equities Compare And Why Investors Are Paying More Attention
While property dominates in sentiment, equities are increasingly becoming the second pillar of wealth for more Singaporeans, especially younger investors. And from an investment perspective, equities may actually have stronger tailwinds going into 2025.
1. Equities historically outperform property
Over the last 20 years:
- The MSCI World Index returned ~8% per year
- The S&P 500 returned ~10% per year
- Singapore private residential property returned an average of 3–4% per year
Equities carry volatility, but they compound faster.
2. A favourable macro environment supports equities
If inflation continues moderating and interest rates continue easing, global equities are well positioned to benefit.
Corporate earnings in the US and Asia remain resilient, and sectors like AI, cloud computing, logistics, and healthcare continue to show structural growth.
3. Liquidity and diversification provide flexibility
Unlike property, equities can be bought or sold instantly, allowing investors to adjust to changing market conditions. Investors can diversify across regions, sectors, and risk levels, which is not possible with a single property.
4. Equities help investors start building wealth earlier
With no large downpayment required, equities allow young investors to start compounding early instead of waiting years before they can enter the property market.
Property or Equities?
The reality is that most Singaporeans will invest in both, but with a different emphasis depending on their stage of life.
Property offers stability, forced savings, and long-term appreciation, but it requires large capital and comes with rising maintenance costs.
Equities offer higher long-term returns, better liquidity, and lower barriers to entry, but they require emotional discipline and a longer time horizon.
In 2025, with property price growth likely stabilising and equities facing a potentially more supportive macro environment, a balanced approach can help investors capture returns while managing risk.
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