Christine Li, Head of Research for Knight Frank Singapore, anticipates that the Singapore housing market will experience a rise in property buyers if SORA (Singapore Overnight Rate Average) rates drop below 2.5%. The SORA rate plays a key role in determining mortgage interest rates in Singapore. When these rates decrease, it can make home loans more affordable, attracting more prospective buyers into the market. This could be especially beneficial for people looking to buy their first home, as lower mortgage rates reduce their overall borrowing costs.

Li also discusses the likelihood of further property cooling measures being implemented by the Singapore government to regulate the market. These cooling measures are typically introduced to control rising property prices and discourage speculative investments. However, according to Li, any such future measures will likely be incremental and will not have a significant impact on first-time homebuyers. This is important because first-time buyers generally aim to secure a primary residence, as opposed to investors who may buy additional properties to profit from capital appreciation or rental income.

The distinction is important because the government’s cooling measures tend to focus on curbing excessive demand in the investment and second-home sectors, rather than limiting opportunities for those purchasing their first property. Therefore, first-time buyers are expected to continue benefiting from favorable market conditions and low borrowing costs. As long as SORA rates stay low, it is likely that more people will be encouraged to enter the housing market, even if new measures are introduced to slow down price growth.

This creates an optimistic outlook for first-time buyers, offering them a chance to purchase homes under more favorable conditions, despite any potential cooling measures.