Broker: CGS International
Date of Report: July 1, 2025

Singapore Property Market Outlook 2025: Price Growth Cools, Developers Trade at Steep Discounts

Private Home Prices See Modest Growth in 2Q25

Singapore’s property market continues to see resilience in private home prices, with the Urban Redevelopment Authority (URA) residential price index rising by 0.5% quarter-on-quarter (qoq) in 2Q25, a slowdown from the 0.8% qoq gain in 1Q25. This brings total private home price growth to 1.3% for the first half of 2025 compared to end-2024 levels.
Core Central Region (CCR) led the gains with a 2.3% qoq increase.
Outside Central Region (OCR) posted a 0.9% qoq rise.
Rest of Central Region (RCR) experienced a 1.1% qoq price retracement.
On the public housing front, the HDB resale price index advanced 0.9% qoq in 2Q25, accumulating a 2.5% increase for 1H25.

Sales Volumes Decline Amid Robust New Launch Pipeline

The Singapore property market experienced a quieter resale environment in 2Q25:
Combined primary and secondary private home sales up to mid-June 2025 fell 11.7% year-on-year (yoy) to 4,340 units.
This compares to 7,261 units transacted in 1Q25.
Despite this, primary private home sales surged 157% yoy in the first five months of 2025, reaching 4,362 units.
Looking ahead, the primary market is expected to remain buoyant thanks to a robust launch pipeline. Another 5,000 units are set to be launched in the remainder of 2025, including notable projects like the 343-unit Lyndenwoods and UPPERHOUSE at Orchard Boulevard. The government has also released land for 4,725 residential units in its 2H25 Government Land Sales (GLS) programme.

Sector Outlook Remains Neutral Amid Economic Uncertainties

CGS International maintains a Neutral outlook for the Singapore property development and investment sector. Key considerations include:
Macroeconomic headwinds and tariff uncertainties could temper buyer sentiment, especially for big-ticket items like housing.
Singapore developers are trading at a steep 60% discount to revalued net asset value (RNAV) and at just 0.5x FY25F price-to-book value (P/BV).
While these valuations offer attractive entry points, a subdued macro environment could cap significant share price appreciation in the next 12 months.

Top Sector Picks: UOL, CLI, City Developments

CGS International’s preferred sector picks, ranked by preference, are UOL Group, CapitaLand Investment (CLI), and City Developments (CIT). Here’s a detailed look at each:

CapitaLand Investment (CLI)

– **Recommendation:** Add – **Target Price:** S\$4.30 – **Current Price:** S\$2.65 – **RNAV Discount:** 45% – **FY25F P/E:** 16.14x – **FY25F P/BV:** 0.92x – **FY25F Dividend Yield:** 4.53%
CLI is one of Asia’s largest real estate investment managers by assets under management. The company’s growth is underpinned by:
Expansion in funds under management.
Efficient capital deployment.
Improved operating performance in its investment and lodging properties. These factors are expected to drive return on equity (ROE) expansion and a potential share price re-rating.

City Developments (CIT)

– **Recommendation:** Add – **Target Price:** S\$8.97 – **Current Price:** S\$5.19 – **RNAV Discount:** 68% – **FY25F P/E:** 19.46x – **FY25F P/BV:** 0.49x – **FY25F Dividend Yield:** 2.31%
City Developments stands out due to:
Active land restocking and a robust launch pipeline for 2025, enhancing earnings visibility.
Value-unlocking initiatives.
Benefiting from the recovery in the global hospitality industry. The stock’s deep discount to RNAV positions it as a compelling value play in the sector.

UOL Group

– **Recommendation:** Add – **Target Price:** S\$8.20 – **Current Price:** S\$6.18 – **RNAV Discount:** 55% – **FY25F P/E:** 15.51x – **FY25F P/BV:** 0.45x – **FY25F Dividend Yield:** 2.91%
UOL Group is favored for its:
High base of recurring income, supported by rentals, hotel operations, and investment holdings.
Strong office exposure through Singapore Land Group.
Solid balance sheet, which offers flexibility to pursue acquisitions and asset enhancements, potentially driving further value within its commercial portfolio.

Peer Comparison: Valuation Snapshot

Risks and Opportunities for Investors

Upside Risks: – Strong sell-through rates for new launches. – Modestly appreciating selling prices.
Downside Risks:
Weaker economic outlook could dampen housing demand.
Slower-than-expected interest rate cuts may keep mortgage rates elevated, impacting affordability.

Conclusion: Value Emerges Amid Headwinds

The Singapore property sector’s fundamentals remain solid, underpinned by a resilient primary sales pipeline and relatively stable pricing, especially in the CCR and OCR segments. Developers are deeply undervalued relative to their asset base, presenting selective opportunities for investors willing to ride out macroeconomic uncertainty. UOL Group, CapitaLand Investment, and City Developments stand out as top picks for their earnings visibility, asset value, and strategic positioning in the current landscape.
Investors should monitor upcoming launches, macroeconomic signals, and policy changes to capitalize on value opportunities in Singapore’s dynamic property market.