Asia Property Market Focus – Singapore & Hong Kong

Singapore: Resilience Amid Regulatory Pressure

Singapore’s property market remains firm, underpinned by strong fundamentals and continued interest from both domestic buyers and foreign investors. Despite stringent cooling measures introduced in 2023—including a 60% ABSD for foreign buyers—private residential prices grew by 1.8% in Q2 2025, led by demand in the Core Central Region (CCR) and city fringe (Rest of Central Region).

New launches such as The Reserve Residences and Watten House have seen healthy take-up, indicating strong buyer confidence, especially among affluent Singaporeans and permanent residents. The Executive Condominium (EC) segment remains highly competitive, with recent launches oversubscribed due to limited supply and rising HDB upgraders.

The rental market has begun to stabilize after two years of rapid growth, with overall rents easing slightly by 1.2% quarter-on-quarter. The Grade A office market in the CBD remains tight, with vacancy rates below 4% and rents rising marginally, supported by demand from financial and tech firms reshoring operations in the region.

Key Trends in Singapore:

• Strong local demand continues to support the residential market.

• Foreign demand has shifted to commercial and industrial assets due to residential tax disincentives.

• Infrastructure developments (e.g., Greater Southern Waterfront, Punggol Digital District) are shaping medium-term investment hotspots.

Hong Kong: Stabilization Signals Return of Buyer Interest

Hong Kong’s residential property market is showing the first signs of a turnaround following a prolonged correction. A series of government stimulus measures—including the removal of double stamp duties and mortgage relaxation—have begun to take effect. Residential transaction volume rose 12% month-on-month in May 2025, marking the third consecutive month of recovery.

The secondary market remains price-sensitive, but primary sales have picked up, particularly in Kowloon East and the New Territories. Developers have responded with more flexible pricing strategies and incentives, which are helping to clear inventory.

Luxury property in districts like Mid-Levels and The Peak remains soft but saw a slight 0.5% uptick in pricing this quarter. Mainland Chinese buyers are slowly returning, although capital controls still pose limitations.

In the commercial sector, office rents in Central continue to slide due to high vacancy (currently around 12.5%) and competition from decentralized locations like Quarry Bay and Kowloon Bay. However, retail leasing is showing resilience, buoyed by increased mainland tourist arrivals and improved domestic consumption.

Key Trends in Hong Kong:

• Gradual residential recovery led by policy easing and attractive developer offers.

• Foreign buyers slowly re-entering amid political and economic normalization.

• Retail recovery is outpacing the office sector in terms of momentum.

Outlook: Balanced Optimism with Structural Shifts

Both Singapore and Hong Kong are navigating a high interest rate environment, geopolitical uncertainty, and shifts in global capital flows. Singapore is increasingly favored as a wealth management and family office hub, fueling demand for commercial space and long-term residential investment. Meanwhile, Hong Kong's rebound may gain traction if policy consistency and market confidence persist.

Investors are advised to monitor:

• Regional monetary policy movements (e.g., potential Fed rate cuts in late 2025).

• Urban redevelopment initiatives and land supply dynamics.

• Shifts in foreign capital trends—especially from China, India, and the Middle East.