What Is Changing in the Luxury Home Market After the 60% ABSD?

Local Buyers Anchor Luxury Home Market: 2025 Sales Rebound, but Market Dynamics Fundamentally Transformed

Following a two-year downturn, Singapore’s luxury residential market in the Core Central Region (CCR) finally showed signs of revival in 2025.

Preliminary data indicates that transactions for super-luxury properties priced at $10 million and above reached 58 units this year, significantly up from 33 in the previous year. Although overall transaction volume has yet to revisit historical peaks, this rebound is widely seen as a pivotal signal that the luxury market is emerging from the doldrums.

Notably, this wave of recovery has been driven almost entirely by Singapore Citizens and Permanent Residents (PRs).

Major Shift in Buyer Profile: Locals Account for Over 80% of Deals

In 2025, Singapore Citizens and PRs accounted for an impressive 84.4% of luxury home buyers. By comparison, before the government raised the Additional Buyer’s Stamp Duty (ABSD) to 60% for foreigners in 2023, foreign buyers made up 44.4% of the luxury segment; this year, that share has dwindled to around 15.5%.

The hefty ABSD has essentially reshaped the luxury landscape, prompting a noticeable pullback of foreign capital and cementing local high-net-worth families as the primary pillar of the market.

New Luxury Launches Gain Market Share, Reflecting Demand for Quality Stock

Within the Core Central Region, the internal composition of luxury transactions has also shifted.

This year, resale luxury homes priced at $10 million or more accounted for 55.2% of deals in the CCR, down from 69.7% last year. Conversely, new luxury launch sales climbed from 30.3% to 44.8%.

This demonstrates that select new projects launched in 2025 hold strong appeal for local high-net-worth buyers in terms of location, specifications, and generous unit sizes.

Not All New Luxury Homes Sell Out: Tenure and Location Prove Crucial

However, not every newly launched luxury project has enjoyed smooth sales momentum.

Developments launched this year such as The Skywaters and W Residences Singapore - Marina View have seen a comparatively measured take-up pace. This is not down to price alone, but rather intrinsic project attributes:

Such projects are situated in the Central Business District (CBD) on 99-year leasehold tenures and lack nearby schools, rendering them less appealing to local families; meanwhile, foreign buyers remain heavily deterred by the 60% ABSD.

For ultra-high-net-worth individuals who view real estate as a wealth preservation vehicle or intergenerational legacy asset, 99-year leasehold properties carry long-term concerns over lease decay, naturally dampening their allure.

In contrast, 21 Anderson near Orchard Road, which was also launched in 2025, has garnered substantially more interest from ultra-wealthy local buyers thanks to its freehold tenure and expansive layouts.

Psf Prices Touch New Highs, but Ultimate Records Still Held by Freehold Gems

In terms of transacted pricing, several high-value deals made headlines this year.

As of early December, 21 Anderson captured three of the year’s top five luxury condo transactions. Two units exceeding 10,000 sq ft each transacted at $52.25 million, translating to roughly $4,999 psf.

On a per-square-foot basis, a resale unit at the freehold Park Nova fetched $6,593 psf, while Skywaters Residences set a new benchmark for 99-year leasehold developments at $6,501 psf.

Nevertheless, the all-time record psf for Singapore's residential market remains held by the freehold development The Marq on Paterson Hill, set at $6,840 psf back in 2011.

Good Class Bungalow Market Holds Steady

In the Good Class Bungalow (GCB) segment, 35 deals were recorded in 2025, on par with last year, with total transaction value reaching approximately $1.27 billion—a slight dip of around 4.6% year-on-year.

Market analysts observe that GCB volumes remain remarkably resilient, largely dominated by ultra-wealthy domestic families and less vulnerable to broader residential market cycles.

Outlook for 2026: Volumes to Consolidate, Domestic Demand to Remain the Main Engine

Looking ahead to 2026, most analysts expect the luxury residential market to enter a phase of stable transaction volumes and price consolidation.

The factors spurring 2025's luxury market rebound included easing borrowing costs and better-than-expected economic performance. However, stricter anti-money laundering (AML) regulations taking effect in 2026 may lengthen transaction due diligence, prompting some UHNW buyers to enter the market earlier this year or adopt a wait-and-see stance.

Heading into next year, the luxury sector will continue to be underpinned by fundamentals, with transaction volumes leveling off and prices staying firm to mildly resilient.

Should ABSD Be Reviewed? Divergent Views Emerge

Differing viewpoints have emerged regarding future policy directions.

The 60% ABSD continues to dissuade foreign buyers from re-entering the prime purchase market, steering many high-earning expatriates toward leasing rather than buying.

Yet, as a global hub for trade and investment, Singapore cannot entirely shut out foreign high-net-worth capital indefinitely. A calibrated review of ABSD for foreign purchasers could not only boost luxury sales, but also breathe fresh life into aging prime developments and the en bloc market.

Conclusion: Luxury Market Rebounds, Ushering in a 'Locally Driven Era'

Overall, Singapore’s luxury home sector in 2025 has shown unmistakable signs of revival, but the underlying market character has undergone a profound shift—from foreign capital-driven to anchored by local high-net-worth families.

Against the backdrop of high ABSD rates, the luxury segment's future trajectory will hinge far more on tenure, spacious floor plans, and long-term capital preservation qualities, rather than purely relying on international inflows.