Fixed vs Floating Mortgage Rates in Singapore: What to Choose in 2026

Short answer: A fixed rate keeps your instalment steady for the lock-in period; a floating rate follows three-month compounded SORA, which was 1.233% on 1 October 2026. In July 2026, an example two-year fixed condo package was 1.40% and a floating one was SORA + 0.25%. With SORA rising since May and the US Fed hiking in September, the gap is small.

This guide was first published on 23 March 2026. It was rewritten on 2 October 2026 from bank, MAS, CPF Board and Federal Reserve sources. The earlier version had a bank-by-bank rate table we could not source, said the Fed was at 3.75% to 4.00% in early 2026 (it was 3.50% to 3.75%), and described the TDSR stress test wrongly.

What is the difference between fixed and floating rates?

• Fixed: the rate is set for an initial period, usually two to five years. Your instalment does not change during that time. After it ends, the loan usually moves to a floating rate.
• Floating: most Singapore home loans now price off the three-month compounded SORA (Singapore Overnight Rate Average) plus a spread set by the bank. Your rate resets as SORA moves.

Both types usually have a lock-in period, with a penalty if you redeem the loan early.

Where is SORA now?

3M compounded SORA, as at the first business day of each month:

Source: DBS/POSB 3-month SORA table, retrieved 2 October 2026. MAS publishes SORA and compounded SORA daily on its Domestic Interest Rates page.

SORA fell by about two-thirds between January 2024 and early 2026, then rose every month from May 2026. Because the three-month rate averages the past three months, it moves slowly.

What rates were banks offering?

The most recent dated package rates we could source are example packages from Redbrick Mortgage Advisory, published by Stacked Homes on 26 July 2026:

These are single examples, not a market range, and they are now more than two months old. Get current quotes from banks or a broker before deciding.

At SORA of 1.233%, the condo floating package above would cost about 1.48% in its first two years (our estimate: 1.233% + 0.25%), close to the 1.40% two-year fixed rate. From year three, the floating spread widens.

What is the US Fed doing, and why does it matter?

SORA is set in Singapore's interbank market, but it tends to follow global rates, especially US rates. The Federal Reserve cut its target range to 3.50% to 3.75% on 10 December 2025. On 16 September 2026 it raised the range by 0.25 percentage point to 3.75% to 4.00% (Federal Reserve).

Before the hike, bank economists quoted by Stacked Homes in July 2026 expected 3M SORA to climb gradually towards 1.3% to 1.4% by year-end. Forecasts are not guarantees; rates can move either way.

How much difference does the rate make to your monthly instalment?

Our estimates (standard amortisation formula, monthly compounding; rates are illustrative inputs, not quotes):

A 1-point rise from 1.48% to 2.48% adds about S$389 a month on an S$800,000 loan with 25 years left (S$3,192 to S$3,581), and about S$729 on S$1.5 million (S$5,985 to S$6,714).

When does fixed or floating suit a borrower?

This depends on your budget, how long you expect to keep the loan, and how much rate risk you can absorb. These are the trade-offs, not a recommendation:

• Fixed suits borrowers who need a predictable instalment, or who would struggle if rates rose by a point or more. The cost is that you do not benefit if SORA falls.
• Floating suits borrowers who can absorb higher instalments and expect SORA to stay flat or fall. Check how the spread rises after the first two years.
• Lock-in length matters if you might sell or refinance soon. Breaking a lock-in usually costs a penalty (see below), though some packages waive it if you sell the property.
• Partial prepayment: Stacked Homes said most of the July packages allowed prepayment of up to 50%, with a 1.5% penalty on amounts prepaid during the lock-in. Check your letter of offer.

What does it cost to break a lock-in or switch packages?

• Early redemption penalty: typically about 1.5% of the outstanding loan during the lock-in (CPF Board). On an S$800,000 loan that is S$12,000.
• Repricing (new package with the same bank): DBS cites a fee of about S$800, with the new package in place within a month.
• Refinancing (moving to a new bank): legal and valuation fees usually above S$2,000, and it typically takes effect at least three months later (DBS). DBS notes that borrowers can sometimes get subsidies to offset these costs.

See our refinancing guide for how to work out a break-even.

How do TDSR and LTV limit what you can borrow?

• TDSR: all monthly debt repayments must stay within 55% of gross monthly income. For residential property, the bank tests the new loan at the higher of 4% and the rate that applies after the initial period, not at your current rate plus a buffer (MAS). Variable and rental income take a haircut of at least 30%.
• LTV: a bank can lend up to 75% for your first outstanding housing loan, 45% for a second and 35% for a third, or 55%, 25% and 15% if the tenure exceeds 30 years (25 for HDB flats) or the loan runs past age 65 (MAS). MAS sets these by the number of outstanding housing loans, tenure and age; its explainer does not set different limits by nationality.
• Foreigners pay 60% Additional Buyer's Stamp Duty on any residential purchase (MOF), which affects how much cash they need.

More in TDSR vs MSR and LTV limits explained.

How does an HDB loan compare?

The HDB concessionary loan rate is 2.6% from 1 October to 31 December 2026. It is pegged at 0.1 percentage point above the CPF Ordinary Account rate of 2.5% (CPF Board, 22 September 2026). According to CPF Board, HDB loans have no lock-in or early repayment penalty and lend up to 75%. You can refinance an HDB loan to a bank loan at any time, but you cannot switch back later.

At July 2026 bank rates, an HDB loan cost more, but its rate has stayed at 2.6% while bank rates have moved. See our HDB loan vs bank loan comparison.

Frequently asked questions

What is the 3-month compounded SORA today?

About 1.233% as at 1 October 2026 (DBS/POSB table, based on MAS data). It was about 1.03% in early May 2026 and has risen each month since.

Are fixed rates cheaper than floating rates in 2026?

In the July 2026 examples, a two-year fixed condo rate (1.40%) was slightly below the floating package at today's SORA (about 1.48% in years one and two, our estimate). That can change as banks reprice.

What happens to my instalment if rates rise 1%?

On an S$800,000 loan with 25 years left, about S$389 a month more (our estimate, from 1.48% to 2.48%). On S$1.5 million, about S$729 more.

Does TDSR test my loan at my actual rate plus 3%?

No. For residential property, MAS requires banks to use the higher of a 4% floor and the rate that applies after the initial period.

Can I switch from fixed to floating during the lock-in?

Usually only by redeeming the loan and paying the penalty, typically about 1.5% of the outstanding amount. After the lock-in ends you can reprice or refinance without that penalty.

Sources

• DBS/POSB, 3-month SORA table (retrieved 2 October 2026)
• MAS, Domestic Interest Rates: SORA and compounded SORA
• Stacked Homes (Redbrick Mortgage Advisory), Singapore's best mortgage rates are back, but the cheapest home loan isn't always the best one (26 July 2026)
• Federal Reserve, FOMC statement, 10 December 2025 and FOMC statement, 16 September 2026
• CPF Board, 3 differences between an HDB loan and a bank loan and interest rates for October to December 2026 (22 September 2026)
• DBS, Repricing vs refinancing
• MAS, Calculating TDSR and Loan tenure and LTV limits
• MOF, Measures for a sustainable property market (26 April 2023)

This page explains rates and trade-offs. It is not financial advice, and SG Properties does not arrange loans.