February 2026 | Real Estate Market Analysis
Executive Summary
Singapore’s residential rental market is navigating a period of post-pandemic recalibration. After rents surged approximately 50% between 2021 and 2023 — one of the sharpest rental inflation cycles in the city-state’s history — the market entered a moderation phase in 2024 and has stabilised into a nuanced equilibrium in 2025–2026. Private residential rents posted a full-year gain of +1.9% in 2025 (URA Rental Index), reversing the -1.9% decline of 2024, while HDB (public housing) rents remained broadly stable with modest upward pressure in select segments.
The rental market’s current trajectory is shaped by a complex interplay of supply pipeline dynamics, public housing policy, Employment Pass (EP) and expatriate inflow trends, broader macroeconomic conditions including interest rate moderation, and the government’s sustained suite of cooling measures. Understanding these dynamics is essential for landlords, tenants, institutional investors, and policymakers alike.
- Market Structure and Segmentation
1.1 The Dual-Track Housing System
Singapore’s rental market operates within a distinctive institutional framework defined by two parallel tracks: the public Housing Development Board (HDB) segment and the private residential segment. This duality, unusual among global gateway cities, has profound implications for price formation, demand elasticity, and policy transmission.
Public housing (HDB flats) accommodates approximately 80% of Singapore’s resident population, with a significant proportion of units eligible for rental following completion of the Minimum Occupation Period (MOP) — currently set at five years. Private residential properties include condominiums, apartments, and landed properties, catering predominantly to higher-income residents and the expatriate community.
Segment Typical Monthly Rent (SGD) Primary Tenant Profile Vacancy (4Q 2025)
HDB 3-room $2,400 – $3,200 Local households, budget expats ~5–6%
HDB 4-room $3,000 – $4,400 Families, mid-income expats ~5–6%
HDB 5-room $3,500 – $4,500+ Families (Queenstown premium) ~5–6%
Condo (OCR) $3,000 – $5,500 Mid-tier expats, upgraders ~6–7%
Condo (CCR) $5,000 – $15,000+ Senior expats, finance/banking ~6–7%
Landed $8,000 – $25,000+ C-suite expats, UHNWI <5%
Table 1: Singapore rental market segmentation, indicative ranges as of Q4 2025. Sources: URA, HDB, ERA Research.
1.2 Geographic Price Stratification
Singapore’s Urban Redevelopment Authority (URA) divides the private residential market into three planning regions: the Core Central Region (CCR), encompassing Districts 9, 10, 11, and the Downtown Core; the Rest of Central Region (RCR); and the Outside Central Region (OCR). Rental performance diverges meaningfully across these zones. In 2Q 2025, the CCR non-landed index rose 1.8% quarter-on-quarter, driven by completions of premium projects such as Midtown Bay and One Holland Village Residences, while the RCR and OCR recorded near-flat growth of 0.0% and 0.1% respectively. This spatial divergence reflects the concentration of expatriate demand in prime districts, particularly among finance, banking, and technology professionals.
- Historical Context: The 2021–2023 Rental Surge
To contextualise current dynamics, it is necessary to examine the extraordinary rental inflation episode of 2021–2023. Multiple reinforcing forces converged simultaneously to produce a supply shock of unusual severity.
2.1 Supply Disruption
The COVID-19 pandemic disrupted construction supply chains and labour availability across Singapore’s building sector, creating significant delays in the completion of both BTO (Build-to-Order) public housing projects and private residential developments. The pandemic-induced pipeline compression meant that units planned for delivery in 2020–2022 were deferred, tightening available rental stock precisely as demand began recovering.
2.2 Demand Acceleration
Simultaneously, demand accelerated from multiple sources. Singaporeans awaiting delayed BTO completions remained in the rental market longer than anticipated. Foreign talent inflows recovered sharply as the economy reopened. The government’s Fair Consideration Framework and subsequent COMPASS (Complementarity Assessment Framework) introduced new qualifying criteria for Employment Pass holders, temporarily driving a front-loading of foreign talent recruitment as firms secured approvals ahead of stricter requirements. The resulting demand surge, colliding with depleted supply, drove rents upward by approximately 50% in cumulative terms between 2021 and 2023.
2.3 Policy Response
The government responded with calibrated cooling measures across both the purchase and rental markets. ABSD (Additional Buyer’s Stamp Duty) rates for foreigners purchasing residential property were raised to 60% in April 2023. LTV (Loan-to-Value) limits for HDB-granted loans were reduced from 80% to 75% in August 2024. These measures, while primarily targeting the purchase market, had indirect rental effects by moderating investor demand and speculative acquisition of units intended for rental yield. - Current Market Dynamics (2024–2025)
3.1 Private Residential Segment
The private rental market experienced a technical correction in 2024, with the URA Rental Index declining 1.9% for the full year. This correction reflected the absorption of a wave of new completions — 8,460 private units were completed in 2024, the highest since 2016. Private rental contracts climbed to a three-year high of 89,376 in 2025, up from 86,476 in 2024, indicating that underlying demand absorption remained robust even as prices moderated.
The 2025 full year posted a +1.9% rental index gain, confirming that the correction was relatively brief and demand-side fundamentals remain intact. However, Q4 2025 saw a sequential decline of 0.5%, suggesting that momentum softened towards year-end, consistent with seasonal patterns and some forward-looking concern about rising medium-term supply.
3.2 HDB (Public Housing) Segment
The HDB rental market displayed somewhat different dynamics. A structural supply constraint emerged from a decade-low in the number of flats reaching MOP: only 6,974 HDB units completed their MOP in 2025, down sharply from 11,952 in 2024 and 15,549 in 2023. Fewer MOP-cleared units entering the rental pool mechanically tightened HDB rental supply even as demand, including from tenants priced out of the private segment, remained steady. HDB rental approvals rose to 39,408 in 2025 from 36,673 in 2024, with the HDB rental price index recovering modestly in late 2025 after three consecutive months of slight declines.
By flat type, 3-room flats recorded the strongest monthly recovery (+1.4% m-o-m in November 2025), while Executive flats softened (-1.8% m-o-m). The spatial pattern shows central towns — particularly Queenstown, where 5-room median rent reached SGD 4,500 — commanding significant premiums over peripheral towns like Sembawang, where 2-room units rent at the SGD 2,270 median.
Indicator 2023 2024 2025 (Full Year)
URA Private Rental Index (% change) +27.0% (cumul.) -1.9% +1.9%
Private rental contracts ~80,000 86,476 89,376
Private completions (units) Highest since 2016 ~8,460 ~7,996 (incl. ECs)
Private vacancy rate Rising Rising 6.0% (4Q 2025)
HDB rental approvals ~39,100 36,673 39,408
HDB MOP units available 15,549 11,952 6,974 (decade-low)
Table 2: Key rental market indicators, 2023–2025. Sources: URA, HDB, PropNex, ERA Research.
3.3 Vacancy Dynamics
Private residential vacancy fell to 6.0% in Q4 2025, down from 6.9% in Q3 2025, suggesting that new supply is being absorbed. This contrasts with the US rental market (for comparative context), where national vacancy reached 7.6%, a level that broadly signals tenant-favouring conditions. Singapore’s vacancy remains below most global gateway city peers, reflecting structural demand underpinned by its position as an Asia-Pacific financial and business hub.
- Demand Drivers
4.1 Expatriate and Foreign Talent Inflows
The expatriate community is a foundational pillar of Singapore’s private rental demand, particularly in the CCR and premium RCR segments. Singapore’s sustained positioning as a wealth management hub, regional headquarters location, and technology cluster continues to attract senior foreign professionals. However, the pace of foreign talent inflow has moderated post-pandemic. The stabilisation of Employment Pass (EP) and S Pass holder numbers in 2024, following significant expansions in 2022–2023, and the structural impact of the COMPASS framework’s higher qualifying salary thresholds, have introduced greater selectivity into the foreign labour market.
Global macroeconomic uncertainty — including the reconfiguration of US trade policy under the 47th administration and AI-driven productivity substitution in white-collar sectors — adds further uncertainty to the expatriate demand outlook for 2026. Tech sector hiring moderation, in particular, could weigh on the mid-tier private rental segment, as technology professionals represent a meaningful share of EP holders.
4.2 Local Displacement Demand
A structural feature of Singapore’s rental demand is ‘displacement demand’ — Singaporean households waiting for BTO flat completions who must rent in the interim. This channel is inherently cyclical: when BTO delays are large, more households enter the rental market; when completions surge, they exit. The government’s commitment to launching over 50,000 BTO units in 2025–2027 and the substantial Sale of Balance Flats (SBF) exercise of early 2025 (offering over 5,500 units) represent a deliberate policy lever to draw down this displacement demand pool over the medium term.
4.3 Interest Rate Environment
MAS eased its monetary policy stance in January 2025, responding to moderating domestic inflation and global trade headwinds. The 3-month SORA fell from approximately 3.3% at end-2024 towards 2.5% by end-2025, and fixed mortgage rates are projected to potentially dip below 2% over the following 18 months. This interest rate trajectory matters for rental demand in two ways: lower borrowing costs stimulate home purchase activity, which over time reduces the structural demand pool for rentals; and lower mortgage costs may induce some investor-landlords to re-enter the purchase market, marginally affecting rental supply. - Supply Pipeline Analysis
The supply pipeline is arguably the most consequential variable shaping Singapore’s rental outlook through 2028. The URA has identified approximately 56,700 private residential units in the pipeline, of which roughly 27,700 are expected to complete by 2028, with a further 29,000 expected from 2029 onwards. In 2026, approximately 6,083 new private units (excluding ECs) are expected to reach TOP (Temporary Occupation Period), broadly in line with 2025 levels.
The more significant supply inflection arrives in 2027–2028: new completions are projected to increase to 8,757 units in 2027 and 10,101 units in 2028. This medium-term supply acceleration is widely expected to temper rental growth in the OCR and RCR segments, where new project concentrations are highest. The CCR, characterised by higher barriers to entry, more limited land availability, and premium tenant profiles, is expected to be comparatively more resilient.
Concurrently, the HDB supply picture is evolving. The number of HDB flats reaching MOP is expected to rise meaningfully in 2026 and beyond, reversing 2025’s decade-low. This should gradually expand the pool of eligible HDB rental units, easing the structural constraint that supported HDB rental prices in 2025. The government’s BTO acceleration also adds completions of owned housing for Singaporean families, progressively reducing displacement demand in the rental market.
Year Private Completions (est.) HDB MOP Units (est.) Market Implication
2025 ~7,996 (incl. ECs) 6,974 (decade-low) Tight HDB supply; stable private
2026 ~6,083 (excl. ECs) Rising (2x of 2025) HDB supply eases; private broadly stable
2027 ~8,757 Further increase Rising private supply; gradual rent softening
2028 ~10,101 Elevated Meaningful supply pressure; moderation likely
Table 3: Supply pipeline projections 2025–2028. Sources: URA, PropNex, Rentify.sg.
- Market Outlook 2026 and Beyond
6.1 Private Residential Rents
The consensus view among major real estate advisory firms — PropNex, ERA, CBRE, and Savills — converges on a ‘flat to modest growth’ outlook for private rents in 2026. PropNex projects marginal single-digit growth, supported by near-term supply stability at approximately 2025 completion levels. ERA’s earlier modelling suggested 0–3% growth for private non-landed rents. The CCR is expected to outperform other regions, underpinned by premium expatriate demand and supply scarcity in prime districts. OCR and RCR performance is expected to be more muted, particularly as the 2027–2028 supply wave comes into view.
The critical downside risk to this consensus is a more pronounced slowdown in foreign talent inflows, whether from global hiring caution, AI-driven workforce restructuring, or any deterioration in Singapore’s economic growth trajectory. The Singapore government projects GDP growth of 2–4% in 2026, below 2025’s 4.8% expansion. A moderate slowdown is broadly expected and priced into market expectations; a sharper deceleration would put downward pressure on the private rental market, particularly the upper-mid tier.
6.2 HDB Rents
HDB rents are broadly expected to remain stable in 2026, with town-level divergence persisting. Central, well-connected towns are likely to retain firmer rental rates, while peripheral, non-mature estates may see modest softening as supply normalises. The rise in MOP-cleared flats entering the market from 2026 represents the most material headwind to sustained HDB rental growth. ERA’s projection of 2–5% growth for HDB rents in 2025, while largely validated for that year, may prove optimistic for 2026 if MOP supply recovery is faster than anticipated.
6.3 Structural Medium-Term Considerations
Looking beyond 2026, the medium-term rental market trajectory will be determined by three structural factors. First, the pace of BTO completions and MOP maturations will progressively expand rental-eligible HDB supply. Second, Singapore’s continued evolution as a wealth management centre and regional headquarters hub will sustain baseline expatriate demand, partially offsetting the public housing supply normalisation. Third, the private market’s significant pipeline of 56,700 units represents an overhang that, if absorbed faster than demand expands, could produce meaningful rental softening by 2028. - Macroeconomic Impact Assessment
7.1 Household Affordability and Consumer Expenditure
Housing costs represent one of the single largest line items in Singaporean household budgets, particularly for renters in the private market and for expatriate families. Despite the post-2023 moderation, private residential rents remain significantly elevated relative to pre-pandemic benchmarks. This sustained rental burden crowds out discretionary consumption and suppresses household savings rates among renter households — a phenomenon with tangible implications for retail sector performance and consumer confidence metrics.
For lower-income Singaporean households reliant on HDB rental stock, the decade-low MOP completions of 2025 created genuine affordability stress, as rental options narrowed and prices held firm. This segment represents a social policy concern distinct from the market dynamics affecting mid-to-upper income renters, and underscores the distributional implications of supply-demand imbalances in public housing.
7.2 Monetary Policy Transmission
The shelter component of Singapore’s CPI — specifically imputed rent for owner-occupiers and actual rent paid — has been a notable contributor to core inflation in recent years. Rental market stabilisation in 2024, and the modest recovery in 2025, have had mixed effects on Singapore’s inflation trajectory. MAS’s easing cycle, initiated in January 2025, was partly predicated on the expectation that rental disinflation would persist and contribute to overall CPI moderation. A resurgence in rental inflation — driven, for example, by unexpectedly strong expatriate inflows or a prolonged supply gap — could complicate MAS’s monetary policy management.
7.3 Labour Market and Business Competitiveness
Singapore’s competitiveness as a destination for foreign talent is, in part, a function of its cost of living — of which housing is the dominant variable. Elevated rental costs increase the total compensation package required to attract senior professionals, raising labour costs for multinational corporations with regional headquarters in Singapore. This dynamic has been explicitly cited by the Economic Development Board (EDB) in discussions of Singapore’s cost competitiveness. The post-2023 rental moderation has partially alleviated this pressure; sustained stabilisation would reinforce Singapore’s attractiveness relative to competing hubs such as Hong Kong, Tokyo, and Dubai.
7.4 Real Estate Investment and Capital Markets
Singapore’s total property investment volume climbed 26.6% year-on-year to SGD 33.3 billion in 2025, with the residential sector contributing 44.9%. The rental market’s stabilisation at elevated absolute levels — private median monthly rent approximately SGD 4,300 for non-landed units — has supported rental yield calculations for investors even as capital values have continued to rise. However, the medium-term supply pipeline introduces compression risk to gross rental yields in the 2027–2028 window, a consideration relevant to institutional investors underwriting residential rental assets and to the overall risk-return profile of Singapore residential exposure. - Comparative Perspective: Singapore vs. US Rental Markets
A brief comparative analysis highlights the structural distinctions between Singapore’s rental market and the US experience (as documented in recent Realtor.com data). In the US, national apartment vacancy reached 7.6% in 2025 — a level generally considered favourable for tenants — driven by a supply wave of over 500,000 new rental units. Markets like Austin, Texas, saw vacancy climb to 13.8% as developer supply dramatically exceeded demand absorption.
Singapore’s experience is fundamentally different in character. Vacancy in the private segment fell to 6.0% in Q4 2025, well below the threshold at which tenant bargaining power materialises. Several structural factors explain this divergence: Singapore’s land scarcity constrains supply elasticity; planning and zoning requirements create longer development cycles; the government’s active management of both supply and demand reduces the speculative overbuilding that characterises some US Sunbelt markets; and the dual HDB-private structure means that the lowest tiers of rental demand are partially absorbed within a subsidised public housing framework, preventing the rental distress seen in US markets with weaker affordable housing infrastructure.
The key implication is that Singapore renters are unlikely to benefit from the kind of structural negotiating advantage emerging in high-vacancy US markets. The rental relief available in Singapore is more measured — price moderation rather than decline — and is spatially uneven, concentrated in newer suburban private developments and non-mature HDB towns.
Dimension Singapore United States (2025)
National vacancy (private) 6.0% (4Q 2025) 7.6% average
Supply response ~8,000 units/yr private 500,000+ units/yr
Rent trend (2025) +1.9% private; stable HDB -1.5% (Jan 2026 YoY)
Government role Active supply mgmt & cooling measures Limited federal intervention
Affordability gap vs pre-COVID ~50% above (2021-23 peak) ~15% above pre-pandemic
Tenant leverage Limited; landlord-favoured Renters gaining; varies by city
Table 4: Singapore vs. US rental market comparison, 2025. Sources: URA, Realtor.com, PropNex, ERA.
- Key Risk Scenarios
Upside Risk: Stronger-than-expected expatriate inflows
If global economic conditions improve and Singapore’s financial and technology sectors experience accelerated hiring, expatriate demand could outpace the projections embedded in current market consensus. This would support firmer private rental growth, particularly in the CCR, and could sustain HDB rental resilience even as MOP supply normalises.
Downside Risk: Sharper global slowdown and AI-driven workforce reduction
A more severe global slowdown — exacerbated by continued trade policy uncertainty or a deeper-than-anticipated AI-driven substitution of white-collar employment — could reduce expatriate inflows and dampen employment-driven domestic demand. This scenario, combined with the medium-term supply pipeline, could produce meaningful rental softening in the 2026–2027 window, particularly in the OCR and RCR private segments.
Policy Risk: Additional cooling measures
The government’s demonstrated willingness to deploy cooling measures in response to market overheating means that any resurgence in rental inflation would likely trigger a policy response. Conversely, any relaxation of cooling measures — such as a reduction in ABSD rates — could stimulate additional investment demand, modestly tightening the rental stock available in the open market.
Supply Execution Risk
Risks of construction delays, cost overruns, or planning constraints could defer projected completions, supporting rental prices beyond current market expectations. Conversely, acceleration of BTO and private completions could bring forward the supply correction. - Conclusion
Singapore’s rental market in 2025–2026 occupies a ‘Goldilocks’ equilibrium — neither overheating nor correcting sharply, but stabilising at levels that remain materially above pre-pandemic benchmarks. Private rents have recovered modestly from their 2024 correction; HDB rents have held firm against a backdrop of structural supply scarcity; and the overall market continues to favour landlords, albeit with meaningfully less pricing power than during the 2021–2023 surge.
The medium-term outlook introduces more uncertainty. The supply pipeline of approximately 56,700 private units, the normalisation of HDB MOP completions from 2026 onwards, and the moderation of expatriate inflow growth represent converging headwinds to rental price appreciation. The rental market is therefore likely to experience a gradual moderation in growth rates through 2027–2028, particularly outside the prime CCR districts.
For policymakers, the central challenge remains balancing housing affordability — particularly for lower-income households and displaced BTO waiters — against the economic competitiveness imperatives associated with maintaining Singapore’s attractiveness to foreign talent. The government’s integrated toolkit of cooling measures, supply management, and public housing provision provides more sophisticated levers than most peer markets, but the effectiveness of these tools depends on continued calibration in response to evolving demand and supply dynamics.
For investors, the Singapore rental market continues to offer stability and liquidity advantages relative to regional peers. The key watch points are the 2027–2028 supply wave, the pace of SORA normalisation, and any policy shifts in the foreign talent framework that could materially alter the expatriate demand base.