Property Price Dynamics Across Core ASEAN Nations: Singapore, Malaysia and Indonesia in Comparative Perspective
Jakarta (ANTARA) - Over the past decade, property price dynamics in three core ASEAN nations — Singapore, Malaysia and Indonesia — have reflected not only structural differences in each country's economic foundations, but also divergent responses to global pressures such as the pandemic, inflation and exchange rate fluctuations. Analysing these differences is not merely a statistical exercise, but a window into understanding a smarter and more rational regional investment map, particularly for investors considering cross-border diversification.
Nevertheless, according to an equity research report from DBS Group, Singapore's property market will face its next major test amid the ongoing trade war between the United States and China, as well as uncertainty surrounding global tariffs imposed by US President Trump. As a trade-dependent economy, Singapore will most likely feel the pressure, the report released on 23 April stated.
DBS Group noted that Singapore's overall Property Price Index rose 0.6 per cent in the first quarter of 2025, slowing from the 2.3 per cent growth recorded in the previous quarter. Given the potential decline in demand, DBS has revised its property price growth projection for Singapore for 2025 to between 0 per cent and 1 per cent, compared with the previous forecast of 1 per cent to 2 per cent.
Regardless, Singapore, as a regional and global financial centre, is predicted to continue demonstrating consistency in property price increases supported by economic stability, urban density and demand from the upper class. Cumulative increases of approximately 53.5 per cent over ten years with real growth of 20–25 per cent serve as a strong indicator that property in this "city-state" is not merely a place to live, but also a symbol of prestige and a hedging instrument. Price resilience in the public property sector, particularly HDB, which rose 9.6 per cent in the past year, underscores the strength of sustained domestic demand.
In a regional context, Singapore stands as an outlier that is virtually unaffected by inflation and exchange rate depreciation, with the SGD fluctuating by only 2.3 per cent over ten years.
Conversely, Malaysia and Indonesia face more complex challenges. Malaysia recorded nominal property growth of 47.7 per cent, but when adjusted for inflation and the significant depreciation of the MYR from 3.3 to 4.4 against the USD, real values have been virtually stagnant. Malaysia's property market was reportedly experiencing unprecedented growth, with property transaction values exceeding 217.46 billion Malaysian ringgit in early 2024, surpassing initial targets, according to New Straits Times.
Malaysia's market structure reveals a sharp duality — an oversupply of sluggish luxury properties and a shortage of affordable housing that is in high demand. This phenomenon indicates an imbalance in property development direction that is not fully synchronised with actual public demand. Policies such as Malaysia My Second Home (MM2H) have attracted foreign investment but are insufficient to drive the entire market inclusively.
Indonesia is even more complex. With property price growth of only approximately 20 per cent nominally and several years recording real declines after inflation adjustment, Indonesia has the weakest property investment performance in the core ASEAN region. The depreciation of the rupiah against the US dollar from 12,500 to 16,500, a drop of 33 per cent, has worsened real returns for foreign investors. Even in Jakarta's relatively stable luxury apartment sector, transaction volumes remain low.
However, there are positive anomalies — areas surrounding major infrastructure projects such as the high-speed railway have shown double-digit growth, proving that connectivity-based investment still holds promise. The tourism property sector in Bali has also begun recovering with rental yields of 5–7 per cent, making it a potential bright spot in an otherwise sluggish landscape.
**Key Factors**
Upon closer examination, the primary causes of this disparity stem from three key factors: exchange rate stability, national policy direction and the quality of domestic demand. Singapore excels because all these factors are simultaneously supportive. Malaysia has been partially successful because pro-investor policies are not balanced by sufficiently strong local socio-economic dynamics. Indonesia, despite its large domestic market, has yet to optimise this potential into solid property price growth due to weak purchasing power, regional disparities and regulatory uncertainty.
Nevertheless, Chairman of the Global Retail Affiliation of Indonesia (AGRA) Roy N. Mandey stated that Indonesia's property sector is projected to maintain stable growth in 2025 despite the current global uncertainty turmoil caused by various factors including tariff wars.
"Property investment in the residential and commercial sectors is predicted to grow 15–18 per cent year-on-year in 2025, with its contribution to GDP increasing from 10 per cent in 2024 to 11.5 per cent in 2025," said Roy N. Mandey.
Equally important is the choice of investment instruments. With property prices in prime locations such as Marina Bay, Jakarta's Golden Triangle and central Kuala Lumpur reaching tens of billions of rupiah or millions of dollars, the majority of retail investors are practically sidelined. This is precisely why the emergence of Real Estate Investment Trusts (REITs) has become a highly rational alternative.
REITs are investment vehicles used to pool funds from investors for subsequent investment in real estate assets by an Investment Manager. These instruments give small investors the opportunity to own quality real estate assets whilst simultaneously enjoying the benefits obtained by mutual fund holders. On the other hand, REITs provide developers with access to funding through capital markets.
Singapore and Malaysia have far more mature REIT markets compared to Indonesia. In Singapore, REITs such as CapitaLand Ascendas have recorded share price growth of more than 100 per cent over ten years, with dividend yields of 6–7 per cent per annum. Combined, total returns reach 200 per cent, or equivalent to 11.6 per cent per annum — an extraordinary figure when compared with physical property returns of only 4–5 per cent.
Indonesia lags far behind in this regard. The domestic REIT market remains limited, with the majority not yet listed, low liquidity and minimal participation from global institutions. This reflects a lack of regulatory incentives and minimal public awareness of this form of investment. Yet for investors seeking flexibility, high liquidity and a low capital entry threshold, REITs are a superior choice. Even in crisis conditions, REITs can be liquidated far more quickly than physical property, which can take months to sell.
**The Right Strategy**
Rengganis K. Wisaksono and Prof. Emmy Pangaribuan SH, in their study entitled "Real Estate Investment Trust (REIT) Perspective in Indonesian Capital Market Law" published by UGM in 2006, stated that REITs have good prospects in Indonesia provided there are regulations that support and accommodate the needs of market participants. Additionally, tax regulations providing incentives for corporate-level tax elimination are needed, with the condition that REITs must have a broad ownership base and the majority of REIT income must be distributed as dividends to investors.
However, it is also important to understand that REITs are not ordinary shares. Although traded on exchanges, REITs represent passive income instruments from productive property ownership, not pure price speculation like technology or commodity stocks. The investment logic is similar to owning physical property — relying on rental income and asset appreciation — but without the hassle of direct management or hidden costs such as land and building tax, maintenance and broker fees.
From this entire analysis, one thing becomes clear: property investment is not merely about location and price, but also about strategy and structure. In the ASEAN context, Singapore offers stability, Malaysia promises differentiation opportunities, and Indonesia holds long-term transformation potential. However, for the time being, for investors with limited capital, the REIT approach — particularly in Singapore — is the most efficient path. Conversely, for those with substantial liquidity and long-term readiness, property in prime locations remains an almost irreplaceable choice.
In other words, the decision to invest in the property sector is not simply a choice between location or price, but rather a choice between liquidity and growth. And ultimately, smart investment always begins with a deep understanding of the economic context, not merely the allure of profit.
Nevertheless, according to an equity research report from DBS Group, Singapore's property market will face its next major test amid the ongoing trade war between the United States and China, as well as uncertainty surrounding global tariffs imposed by US President Trump. As a trade-dependent economy, Singapore will most likely feel the pressure, the report released on 23 April stated.
DBS Group noted that Singapore's overall Property Price Index rose 0.6 per cent in the first quarter of 2025, slowing from the 2.3 per cent growth recorded in the previous quarter. Given the potential decline in demand, DBS has revised its property price growth projection for Singapore for 2025 to between 0 per cent and 1 per cent, compared with the previous forecast of 1 per cent to 2 per cent.
Regardless, Singapore, as a regional and global financial centre, is predicted to continue demonstrating consistency in property price increases supported by economic stability, urban density and demand from the upper class. Cumulative increases of approximately 53.5 per cent over ten years with real growth of 20–25 per cent serve as a strong indicator that property in this "city-state" is not merely a place to live, but also a symbol of prestige and a hedging instrument. Price resilience in the public property sector, particularly HDB, which rose 9.6 per cent in the past year, underscores the strength of sustained domestic demand.
In a regional context, Singapore stands as an outlier that is virtually unaffected by inflation and exchange rate depreciation, with the SGD fluctuating by only 2.3 per cent over ten years.
Conversely, Malaysia and Indonesia face more complex challenges. Malaysia recorded nominal property growth of 47.7 per cent, but when adjusted for inflation and the significant depreciation of the MYR from 3.3 to 4.4 against the USD, real values have been virtually stagnant. Malaysia's property market was reportedly experiencing unprecedented growth, with property transaction values exceeding 217.46 billion Malaysian ringgit in early 2024, surpassing initial targets, according to New Straits Times.
Malaysia's market structure reveals a sharp duality — an oversupply of sluggish luxury properties and a shortage of affordable housing that is in high demand. This phenomenon indicates an imbalance in property development direction that is not fully synchronised with actual public demand. Policies such as Malaysia My Second Home (MM2H) have attracted foreign investment but are insufficient to drive the entire market inclusively.
Indonesia is even more complex. With property price growth of only approximately 20 per cent nominally and several years recording real declines after inflation adjustment, Indonesia has the weakest property investment performance in the core ASEAN region. The depreciation of the rupiah against the US dollar from 12,500 to 16,500, a drop of 33 per cent, has worsened real returns for foreign investors. Even in Jakarta's relatively stable luxury apartment sector, transaction volumes remain low.
However, there are positive anomalies — areas surrounding major infrastructure projects such as the high-speed railway have shown double-digit growth, proving that connectivity-based investment still holds promise. The tourism property sector in Bali has also begun recovering with rental yields of 5–7 per cent, making it a potential bright spot in an otherwise sluggish landscape.
**Key Factors**
Upon closer examination, the primary causes of this disparity stem from three key factors: exchange rate stability, national policy direction and the quality of domestic demand. Singapore excels because all these factors are simultaneously supportive. Malaysia has been partially successful because pro-investor policies are not balanced by sufficiently strong local socio-economic dynamics. Indonesia, despite its large domestic market, has yet to optimise this potential into solid property price growth due to weak purchasing power, regional disparities and regulatory uncertainty.
Nevertheless, Chairman of the Global Retail Affiliation of Indonesia (AGRA) Roy N. Mandey stated that Indonesia's property sector is projected to maintain stable growth in 2025 despite the current global uncertainty turmoil caused by various factors including tariff wars.
"Property investment in the residential and commercial sectors is predicted to grow 15–18 per cent year-on-year in 2025, with its contribution to GDP increasing from 10 per cent in 2024 to 11.5 per cent in 2025," said Roy N. Mandey.
Equally important is the choice of investment instruments. With property prices in prime locations such as Marina Bay, Jakarta's Golden Triangle and central Kuala Lumpur reaching tens of billions of rupiah or millions of dollars, the majority of retail investors are practically sidelined. This is precisely why the emergence of Real Estate Investment Trusts (REITs) has become a highly rational alternative.
REITs are investment vehicles used to pool funds from investors for subsequent investment in real estate assets by an Investment Manager. These instruments give small investors the opportunity to own quality real estate assets whilst simultaneously enjoying the benefits obtained by mutual fund holders. On the other hand, REITs provide developers with access to funding through capital markets.
Singapore and Malaysia have far more mature REIT markets compared to Indonesia. In Singapore, REITs such as CapitaLand Ascendas have recorded share price growth of more than 100 per cent over ten years, with dividend yields of 6–7 per cent per annum. Combined, total returns reach 200 per cent, or equivalent to 11.6 per cent per annum — an extraordinary figure when compared with physical property returns of only 4–5 per cent.
Indonesia lags far behind in this regard. The domestic REIT market remains limited, with the majority not yet listed, low liquidity and minimal participation from global institutions. This reflects a lack of regulatory incentives and minimal public awareness of this form of investment. Yet for investors seeking flexibility, high liquidity and a low capital entry threshold, REITs are a superior choice. Even in crisis conditions, REITs can be liquidated far more quickly than physical property, which can take months to sell.
**The Right Strategy**
Rengganis K. Wisaksono and Prof. Emmy Pangaribuan SH, in their study entitled "Real Estate Investment Trust (REIT) Perspective in Indonesian Capital Market Law" published by UGM in 2006, stated that REITs have good prospects in Indonesia provided there are regulations that support and accommodate the needs of market participants. Additionally, tax regulations providing incentives for corporate-level tax elimination are needed, with the condition that REITs must have a broad ownership base and the majority of REIT income must be distributed as dividends to investors.
However, it is also important to understand that REITs are not ordinary shares. Although traded on exchanges, REITs represent passive income instruments from productive property ownership, not pure price speculation like technology or commodity stocks. The investment logic is similar to owning physical property — relying on rental income and asset appreciation — but without the hassle of direct management or hidden costs such as land and building tax, maintenance and broker fees.
From this entire analysis, one thing becomes clear: property investment is not merely about location and price, but also about strategy and structure. In the ASEAN context, Singapore offers stability, Malaysia promises differentiation opportunities, and Indonesia holds long-term transformation potential. However, for the time being, for investors with limited capital, the REIT approach — particularly in Singapore — is the most efficient path. Conversely, for those with substantial liquidity and long-term readiness, property in prime locations remains an almost irreplaceable choice.
In other words, the decision to invest in the property sector is not simply a choice between location or price, but rather a choice between liquidity and growth. And ultimately, smart investment always begins with a deep understanding of the economic context, not merely the allure of profit.