Little India remains big draw for shophouse buyers in 2025 amid a slow market

SINGAPORE – From restaurants and mini-marts in Serangoon Road to cafes and bars in Jalan Besar, Little India’s appeal to both tourists and locals has seen more shophouses change hands in 2025, even as the wider market slowed.

In PropNex Research’s latest shophouse market report released on Jan 26, District 8 (Little India) topped sales in the last three months of 2025, with seven deals valued at $46.3 million.

For the full year of 2025, District 8 saw 24 shophouse deals worth $183 million – accounting for more than a quarter of the total shophouse sales value in that year, said Ms Wong Siew Ying, head of research and content at PropNex.

Deals included a collective sale of three freehold shophouses in Jalan Besar within the Desker Road Conservation Area for $36.5 million in September 2025.

PropNex figures are based on the Urban Redevelopment Authority Realis caveats data.

Mr Richard Tan, founder of PropNex Shophouse Elites, which specialises in shophouse sales, said that Little India has consistently been among the more active shophouse districts in recent years due to its lower entry price point, which has attracted many first-time investors.

“Most of the units were sold for under $10 million, with average prices hovering around $6 million to $7 million,” he noted.

“Many investors would compare buying a $6 million shophouse with buying a residential property, as commercial properties are not subject to additional buyer’s stamp duty (ABSD).”

Singaporeans buying their second residential property

have to pay an ABSD of 20 per cent

, and 30 per cent for those acquiring their third and subsequent properties.

Singapore permanent residents buying their second residential property have to pay an ABSD of 30 per cent, and 35 per cent for third and subsequent properties. Foreigners have to pay 60 per cent when buying any residential property.

Strong tenant demand is another driving factor, as Little India sees high footfall throughout the day, added Mr Tan.

Across Singapore, however, shophouse transactions have continued to fall since 2021.

Data from Knight Frank, which tracked both caveated and some uncaveated transactions, showed that there were 96 deals valued at $879.7 million in 2025. In 2024, there were 95 transactions worth $947.8 million.

In 2023, there were 133 transactions worth $1.24 billion, compared with 191 deals worth $1.63 billion in 2022. The market peaked in 2021, when 253 shophouses changed hands for $1.94 billion.

Caveats are legal documents lodged by purchasers with the Singapore Land Authority to register their legal interest in a property. This process is not mandatory.

Property experts said

the slowdown in recent years

reflected a gap between buyers’ expectations and sellers’ asking prices, rather than weak demand.

ERA Singapore chief executive Marcus Chu said higher prices and global economic uncertainty have reduced investor interest, although actual transactions may be higher as some deals were done through share sales or without lodged caveats.

Mr Tan of PropNex said his team closed more than 20 shophouse deals in 2025, with more than half the buyers choosing not to lodge caveats.

He cited, for example, a Malaysian who paid $13 million for a 4,000 sq ft, 99-year leasehold unit in Tanjong Pagar and a Singaporean businessman who paid close to $10 million for a 2,000 sq ft, 999-year leasehold unit in Kampong Gelam. Both deals were completed without caveats being lodged.

Ms Wong of PropNex noted that, based on caveats lodged, there were more big-ticket shophouse purchases in the last three months of 2025, which saw nearly seven in 10 shophouses resold above $5 million. For the full year, about 63 per cent of the deals exceeded $5 million, a proportion that was broadly consistent with 2024.

She added that average prices on a land area per square foot (psf) basis also rose across most key districts.

In the second half of 2025, Knight Frank recorded 15 transactions that generated positive returns, with four deals delivering returns of over 100 per cent with an average holding period of 18 years. One shophouse in Pagoda Street, sold after nearly 22 years, achieved a return of more than 400 per cent.

Ms Wong said districts 14 and 15 saw prices rise by 8.5 per cent year on year to $3,817 psf in 2025, while prices in districts 7 and 8 grew by 8.2 per cent in 2025 from 2024.

Prices in the downtown core of districts 1 and 2 edged up by 1.3 per cent to $8,850 psf.

Mr Chu attributed the strong sales in districts 8 and 15 (East Coast and Marine Parade) to “strong footfall, hospitality demand and cultural appeal”. These two areas are home to many conservation properties.

“Conservation shophouses remain tightly held, with only about 6,500 units islandwide, and continue to attract investors despite stricter preservation guidelines because of their rarity and long-term value,” said Mr Chu.

But Ms Wong said that while investors continue to ink shophouse deals, leasing conditions remain challenging, particularly for the food and beverage industry, with 2,431 outlets closing in the first 10 months of 2025.

“Intense competition, shifting consumer spending habits and manpower shortages continue to weigh on such operators, who are key demand drivers for shophouse space,” said Ms Wong.

She noted that shophouse leasing activity has fallen to its lowest level since the third quarter of 2020, with 775 rental contracts signed in the fourth quarter of 2025.

For the full year of 2025, 3,237 contracts worth $34.9 million were inked, a sharp slowdown from 2024, when 3,566 contracts worth a record $40.5 million were signed.

“Occupier demand for shophouses is expected to be uneven, with stronger interest concentrated in prime locations that benefit from high footfall, such as Chinatown, Telok Ayer and Little India. Landlords may have to adjust their expectations if their properties are located in less sought-after areas,” said Ms Wong.

Knight Frank Singapore Capital Markets executive director Mary Sai said: “Shophouses are highly versatile assets that can accommodate a wide range of uses, including hospitality, office and F&B operations. However, the performance of the F&B sector has been uneven in recent years, with some operators demonstrating more resilience than others, which have exited the market.”

This has led some shophouse owners to consider selling, though such properties are rarely sold at a discount.

Mr Abraham Sekar, who runs several barber shops in Little India including The Madras Barbers, said that whenever a new landlord emerged, his rent would go up, each time by $1,000 to $2,000.

In November 2025, businessman Rajakumar Chandra, who runs Jothi Store and Flower Shop in Campbell Lane, paid $6.3 million for a 1,370 sq ft shophouse in Cuff Road.

He told The Straits Times that he spent two years looking for a shophouse in Little India.

“There weren’t many units for sale and whatever came up was quite expensive. There’s always demand for shophouse units in Little India due to the high footfall and most owners won’t reduce their prices,” said Mr Rajakumar.

Noting that rent has been rising in Little India, he added: “I will be using the space as a warehouse and my workers can also stay on the upper floor.”