“This resilience is underpinned by acute supply constraints in the Orchard-Nassim-Ardmore enclave, where only three luxury developments on sites exceeding 40,000 sq ft have been launched over the past 12 years. Coupled with the ongoing rejuvenation of Orchard Road, the structural scarcity of prime sites supports long-term value preservation and, potentially, capital appreciation,” Poh told Asian Private Banker.

Singapore’s broader housing market, however, is entering a period of greater supply. The government plans to maintain a high level of private housing supply, with 9,320 units on the 2026 Confirmed List — more than 50% above the past decade’s annual average. Around 60,600 private residential units, including executive condominiums, are expected to be completed over the coming years.

That supply should temper broad-based price appreciation, but may also sharpen the distinction between the mainstream market and Singapore’s most scarce residential homes.

A wealth-preservation play

The appeal of Singapore’s luxury residential market for high net worth individuals (HNWI) extends well beyond price appreciation.

Luxury residential property in Singapore is “an unusually efficient store of wealth, a proven inflation hedge, excellent collateral against which to borrow, and lightly correlated to the public markets where the rest of the portfolio sits,” Birbal Singh Bajaj, managing director at Baksh Capital, told APB.

Singapore’s luxury residential real estate also “functions as jurisdictional insurance: an AAA-rated legal system, an independent judiciary and predictable property rights, which is worth considerably more to most families than any yield,” he added.

Bajaj’s conviction is shaped in part by his family’s own experience with the asset class. His family began assembling a substantial residential property portfolio in the early 1960s, with a long-term approach to wealth preservation that continues to influence his family office’s investment strategy today.

Baksh Capital is a single-family office of a third-generation Singaporean family. The firm invests proprietary capital across public and private markets globally, with direct real estate and hospitality holdings across Southeast Asia, Australia and the United Kingdom. While Bajaj did not disclose Baksh Capital’s assets under management, its asset management arm, Prima Asset Management, manages around S$250 million.

Nationalities of luxury & ultra-luxury home buyers

Singapore’s family-office ecosystem continues to expand, with the number of single-family offices surpassing 2,000 by the end of 2024, up from 1,400 a year earlier, according to the Monetary Authority of Singapore.

Luxury residential property is often among the first major allocations made by newly established family-office owners in Singapore, Bajaj highlighted, with many buying a luxury penthouse or good class bungalow (GCB).

GCBs are among the most prestigious forms of landed housing in Singapore. More than 2,000 such homes are located across 39 designated areas, primarily in the city-state’s prime districts, according to data from the Urban Redevelopment Authority.

What drives the price?

In a country where around 80% of the population lives in public housing, some of which has sold for over S$1 million in recent years, what distinguishes a luxury home from an ordinary property is a pertinent question.

Luxury homes are typically defined by three things: location, materials and service. Buyers seek prestigious addresses, exclusivity, premium finishes and concierge services, said Arthur Aw, executive director of developer Kimen Group.

That definition is evolving. “Today’s buyers are looking beyond finishes. They are asking: How does this place improve my quality of life?” Arthur Aw, the developer of Jervois Mansions, told APB.

The 130-unit development sits on the fringe of Singapore’s Core Central Region, having been redeveloped from three GCBs. Positioned closer to the entry point of the luxury segment, Jervois Mansions’s residents include executives from Singapore and overseas.

For Aw, competing purely on price or PSF misses the broader shift in what buyers expect from a luxury home. “The question is, how can we differentiate?” he said. “You buy this land, I buy this land, he buys this land. How can Kimen develop a product that is differentiated from all three of them?”

Spatial elements are becoming an increasingly important differentiator, particularly at the ultra-luxury end of the market, Aw said. Larger floor plans, bespoke materials and architectural details can command higher PSF prices and help justify the premium commanded by the segment.

Yet luxury does not necessarily mean using the most expensive materials. Among younger luxury buyers, sustainability, craftsmanship and exclusivity are becoming increasingly important considerations, Aw observed.

The definition of luxury is also expanding beyond the physical home to encompass how a development supports residents’ lifestyles. Family-oriented amenities, child- and pet-friendly spaces, and opportunities for social interaction are increasingly influencing how projects are designed.

For developers, that makes understanding the target buyer as important as the materials used in the building. “The focus is on creating developments that address the practical and experiential needs of residents while delivering a level of design, detail and experience that sets them apart from conventional housing,” Aw stressed.

Intergenerational continuity

One of the benefits of holding luxury properties over other assets is the intergenerational continuity it can offer. Real estate can be “transferred across generations, without requiring interpretation,” Bajaj said, adding that a 20% to 30% allocation to the asset class is defensible for families with a multi-generational investment horizon.

For such investors, rental yield is rarely the primary consideration. “To buy prime residential in Singapore for its yield is to misread the instrument. Gross yields on luxury homes run at 2% to 3%, and my grandfather’s generation would have found the rent almost incidental. The rent kept the lights on; the land did the work,” Bajaj said.

One example was the family’s divestment of Nanak Mansions on Meyer Road, a 36-unit development that was sold for S$201.1 million in 2017 to a joint venture between UOL Group and Kheng Leong. The site has since been redeveloped into the luxury project Meyer House. At present, the family has no intention of selling the remainder of its luxury residential portfolio.

Singapore’s combination of limited prime land, rising wealth and a growing family-office ecosystem is creating a market in which buyers are increasingly seeking differentiation rather than simply higher specifications.

Just as Singapore’s 61st birthday theme, “Go Beyond”, suggests, the road ahead for its luxury residential market may not simply be about producing more, but moving beyond conventional definitions of luxury towards properties that are rarer, more distinctive and ultimately harder to replace.

“I don’t think we want to merely be a hub of luxury markets. I think we want to be a hub of one-of-a-kind ultra-luxury,” Aw said. “There’s something very interesting there. A lot of very rich people — not all, but a lot of them — are very low profile and hidden in Singapore. So by catering to them innovatively, we can make Singapore a smart, wealth hub.”