Knight Frank Commentary | URA Flash Estimates - Q4 2025

Knight Frank Commentary | URA Flash Estimates - Q4 2025

URA Private Residential Flash Estimates

Based on flash estimates released today, the URA All Residential Price Index increased by a slight 0.7% q-o-q in Q4 2025 with an overall increase of 3.4% for the whole of 2025. The estimate for Q4 2025 and the entire year is unlikely to change significantly when the finalised numbers are announced in the fourth week of January, as there was little activity in December due to the year-end holidays.

In a reversal from the first nine months of the year, non-landed home prices in the Core Central Region (CCR) recorded the highest quarterly decline of 3.2% in Q4 2025 after having increased 5.6% from January to September. For the entire year, prices in the CCR increased by a moderate 2.2%. Without new launches in the prime residential areas anchoring prices, general resale activity accounted for the decrease in the final quarter. A quick scan of caveats in 2025 showed that new sales of high-rise luxury homes in the prime areas of over 2,500 sf registered a median price of S$4,692 psf. In contrast, the median price of S$2,182 psf was recorded for resale properties with the same parameters. With the median unit prices of new product commanding a premium that is more than double that of resale transactions, discerning buyers could find more affordable opportunities for completed prime homes with good value. Some of the older reputable projects in the Core Central Region, where larger family-sized units are more proliferate, can have price tags at a substantial discount to new launches, and possibly just as affordable homes in non-prime areas.

In the Rest of Central Region (RCR) prices increased by a marginal 0.7% q-o-q and 1.6% y-o-y in Q4 2025. Launches in the Outside Central Region (OCR) contributed to prices rising 1.0% q-o-q and 3.2% y-o-y in Q4 2025. 

It was the landed market that contributed most to price increase in the private home market in 2025. Landed home prices increased 3.5% q-o-q and by a significant 7.7% y-o-y in Q4 2025, after a rather indifferent increase of 0.9% y-o-y in 2024. Even though sellers continued to be sticky with asking prices, the lowered interest rate environment improved affordability among buyers and motivated both buyers and sellers to a transaction decision that resulted in a pickup in sales activity throughout most of the year.

Private home prices increased 3.4% for the whole year, coming in at the lower end of the projected range of 3% to 5% made by Knight Frank at the start of 2025. Overall, this reflected some sensitivity on the part of developers’ to homebuyers’ price concerns. This reined in price growth even though the easing of interest rates through much of 2025 boosted sales activity. The anticipated private home price growth in 2026 is expected to range by a similar 3% to 5%, given that homebuyer demand remains intact amid global macroeconomic headwinds, cost-of-living concerns, and labour market worries. Amid the resilience in the private home market, cautious overtones are creeping into the consciousness of potential homebuyers, especially for employees in industries that are facing business stress as the world changes rapidly.

The supply of 9,185 potential private homes from both the confirmed and reserve lists of the government land sales programme (GLS) in H1 2026 remains above the 9,000 mark, higher that the half-yearly totals from H1 2018 to H1 2025, ensuring a steady pipeline of private housing. However, the number of interested participants as well as the premium mark-ups in land rates among the top bidders at GLS tenders have been observed to be increasing. While GLS tenders earlier in 2025 were often measured and land rates were within expectations, the last few tenders in the second half of 2025 appear to reflect a greater urgency and a stronger willingness to push land pricing boundaries on the part of developers. The brisk take-up of more than 10,000 new sales in 2025 could have spurred developers to ratchet up efforts in dedicating more financial resources in acquiring land. The increasing land prices will inevitably have a knock-on impact on selling prices at launch some 12 to 15 months later. It is hard to predict whether homebuyer demand will remain as strong in the year ahead against a backdrop of continuing global economic uncertainty with some multi-national corporations announcing layoffs. Perhaps some temperance on the part of developers will not only be good for the overall longer-term sustainable health of the private home market, but also manage the margins and costs should economic conditions and homebuyer demand turn unexpectedly.