How does the US trade tariff affect the Singapore Property Market?

Following the US announcement of an upward revision of trade tariffs and tit-for-tat retaliation from China, we saw the stock market plummet across major financial markets. But many stock markets, including Singapore, gained some ground after US announced a temporary pause on tariffs.

The ongoing tiff between China and the US has created much uncertainty in the market, and the world is still calibrating its reactions to this series of events.

We all know the stock market can be quite volatile, and most people go into it with a short- to mid-term mindset. But real estate—especially in Singapore—is a different game. It’s a long-term play, and much less speculation is involved.

Right now, we’re seeing extreme volatility in the stock market. However, unlike equities, properties are not liquid, and property owners cannot buy and sell their properties like they would when trading stocks.

Therefore, the property market is not like the stock market. It is not volatile, and homeowners tend to hold onto their properties for the longer term, which helps keep the property market stable during uncertain times.

It comes down to strong fundamentals like political stability, a robust financial system, our strategic geographical location, low unemployment rates, and sound governance.

We’ve also got a vast network of trade agreements, great infrastructure, and a highly educated workforce—that’s why foreign investors keep returning.

This creates a firm foundation for long-term economic growth and job opportunities, supporting property demands.

Regarding housing, the government has always taken a pragmatic approach, including cooling measures, increasing the housing supply, and ensuring long-term sustainability.

With the right policies and real demand continuing to drive the market, we believe Singapore’s property sector will stay resilient and offer long-term value for homeowners and investors.

It’s worth keeping an eye on how the trade war unfolds—especially if there are more retaliatory measures that could shake up global supply chains. On the positive side, who knows, both superpowers, the US and China, will come to the negotiation table soon.

At the same time, how the US Federal Reserve reacts to inflation and growth pressures via rate cuts could also have an impact here in Singapore, especially when it comes to mortgage rates and home financing.

The aggressive tariff move by the US could trigger retaliatory actions from other countries—China, for instance, has already hit back at Trump tariff hike with an 125% duties on all US goods.

As the trade war intensifies, the global economy is likely to feel the pressure, and given how dependent Singapore is on trade, we’re not immune to that impact either.

That said, Singapore’s diversified economy and broad network of trade partners put us in a better position to ride out these shocks.

The ‘China Plus One’ strategy was previously commonly used by companies to diversify their manufacturing hubs to reduce reliance on China. One way was to establish another production facility in another country in addition to China.

With the ‘China Plus One’ strategy facing disruption by the US trade tariffs, regional low-cost manufacturing hubs could struggle.

But Singapore’s reputation as a trusted, open, and stable economy might actually attract more investors and companies looking for more stable ground—especially in the commercial and industrial space.

From 2010 to 2024, the Singapore government rolled out 13 rounds of cooling measures to keep the residential market stable and price growth sustainable.

These most recent measures included the significant 60% Additional Buyer’s Stamp Duty (ABSD) implemented in April 2023, targeting speculative investment from foreign buyers. Additionally, the higher ABSD on second homes is intended to discourage accumulation of multiple properties, helping to stabilize home price growth and maintain market stability. All of this contributes to sustaining the intrinsic value of residential properties in Singapore.

The government has always taken a practical, forward-looking approach—well calibrating housing supply to meet demand, while discouraging excessive accumulation and curbing speculation of property assets.

Thanks to these proactive steps, Singapore now has the flexibility to unwind some of the implemented cooling measures and respond quickly if external shocks—like global trade tensions—start to impact the market.

Singapore’s strong position as a global financial hub—along with our robust legal framework—makes us even more attractive during uncertain times.

For investors who are looking for a safe haven and long-term growth, Singapore continues to stand out. Our stability and open economy gives them confidence, and that could help drive continued demand for commercial and industrial properties here.

Foreign direct investment plays a big role in our economy, and we expect it to continue supporting growth and creating opportunities across the real estate sector.

Singapore has earned its reputation as a safe, stable market, which puts us in a good position to attract foreign investors looking for safe and long-term growth opportunities.  This will support economic growth and job creation, that is important in supporting housing demand.

Should more companies set up or expand businesses in Singapore, this could also increase demand for residential properties. However the 60% ABSD is making it challenging for the foreigners to buy homes in Singapore, so we expect many of them to be renting homes.

On the ground, we expect most developers to go ahead with launches that are already planned. Historically, our property market has proven to be resilient, even during global uncertainty.
And with demand in Singapore largely driven by genuine homeownership needs—not speculation—this support from domestic buyers continues to keep the market steady.

On the contrary, the luxury market is less susceptible to volatility, since these buyers have stronger holding power. In fact, we may see stronger interest from newly minted affluent PR or citizens.

There’s definitely a lot of uncertainty in the market right now—you can see it in how global stock markets have reacted. But that is largely a knee-jerk reaction to all the volatilities we’ve seen over the past few days.

That said, when it comes to the property market, things are a lot more stable. Homebuyers here tend to take a longer-term view, and most are buying based on genuine needs, not speculation.
Sure, the financial market may have split over some negative sentiments to the property market, some people might be putting their purchase plans on hold to wait and see how things play out—but this is temporary.

So if home buyers and owners are looking at mid to long term, there’s no real cause for concern. All in all, the property market is still calm, rational, and grounded in real demand.

Assuming that the inflation happening in US is due to higher cost of goods, and decreased spending by consumers, leading to lower demand, US may go into recession.

In the last two decades, we have seen major world events like the Russia-Ukraine war, Covid-19, and the Global Financial Crisis.

Each time there is a black swan event, the impact is short-lived and is typically mitigated by world governments’ rescue programs.

Let’s talk about construction materials from China. In the scenario if there is a significant dip in US demand for Chinese construction material imports, and China decides to divert its excess supply by flooding the region with cheaper exports, we could start to see significant deflationary pressures across the region.

Take steel, for example. With the slowdown in China’s property sector, domestic demand for steel rebar has dropped, and prices have already softened. Add the 145% US import tariffs on China into the mix, and it becomes a knockout effect —dampening export demand for Chinese steel even more.

With rising tensions and both the US and China imposing historically high tariffs on each other, there’s a greater risk that China might push even more low-cost exports into the region.

With all that said, it looks like construction costs may fall due to lower building material costs. Now instinctively, some people may assume that property prices will start coming down as a result. However, our view is that even if construction material costs come down, it is unlikely that property prices will also come down. 

In Singapore, property prices are driven by multiple factors, such as land costs, labour costs, professional fees, taxes like property tax, stamp duties and developer ABSD, and of course, interest rates.

Even though there’s still quite a bit of uncertainty, Singapore’s property market is backed by firm economic fundamentals. It continues to offer growth opportunities for investors who take a medium- to long-term perspective.

So yes, Singapore is expected to feel a moderate direct impact from the lower baseline 10% tariff. However, in the short term, a lot of impact could be intensified by heightened uncertainty due to the escalating trade war.This will in turn affect Singapore’s economy, since we rely heavily on international trade.

But here’s the good news—Singapore has a diversified economy and a strong network of trade partners that can help cushion the impact.

The government’s been proactively laying the groundwork to drive long-term economic growth and job creation—two key things that continue to support demand in our thriving residential market.