Q2 2026 3-month SORA holds at 3.25% (flat QoQ), keeping floating-rate mortgages at roughly 4.00% effective (3.25% + 0.75% bank spread). On a $1.5M loan over 25 years that translates to approximately $7,920 per month — meaning buyers and refinancers face the same cost environment as Q1, with no near-term relief expected until at least late 2026 (as of 2026-Q2).
SORA — the Singapore Overnight Rate Average — replaced the discredited SOR and SIBOR benchmarks as Singapore’s primary floating-rate reference for residential mortgages in 2021. Unlike its predecessors, SORA is a backward-looking rate derived from actual overnight interbank transactions, published daily by the Monetary Authority of Singapore. The compounded 3-month SORA that banks use as a mortgage peg smooths daily volatility into a rolling 91-day average, making it less prone to short-term spikes than the old SIBOR.
To appreciate where 3.25% sits today, consider the full rate cycle. In early 2021, 3-month compounded SORA was barely 0.20% — a historic floor driven by pandemic-era stimulus. From late 2022, global tightening pushed it sharply upward, peaking near 3.80% in September 2023. Since then, rates have eased modestly but remain elevated relative to the 2020–2022 era. At 3.25% in Q2 2026, SORA is approximately 3.05 percentage points above its 2021 floor and roughly 55 basis points below its 2023 peak — a plateau, not a retreat (as of 2026-Q2).
The flat quarter-on-quarter reading is itself meaningful. MAS tightened its S$NEER policy band in April 2026 in response to geopolitical energy-price pressures — a move that supports a stronger Singapore dollar but does not mechanically push SORA lower. Absent a sharp US Federal Reserve rate cut or a domestic recession, the consensus among local banks is that 3-month SORA will remain in the 3.00%–3.35% range through mid-2026 before a gradual downward drift toward year-end. Borrowers should plan accordingly: the rate plateau is real, and the window for locking a fixed rate near current levels may be narrowing. See the MAS monetary policy framework for context (as of 2026-04).
- Q2 2026 SORA Analysis
- 1M SORA: 3.1000%
- 3M SORA: 3.2500%
- 6M SORA: 3.3500%
- 3M SORA QoQ: +0.0% (up)
SORA Rate Summary — Q2 2026
The Singapore Overnight Rate Average (SORA) is the primary benchmark for floating-rate mortgages in Singapore, replacing the previous SOR and SIBOR benchmarks. See MAS SORA dashboard for live rates.
Mortgage Payment Scenarios
Monthly mortgage payments at different loan amounts under current 3M SORA (3.2500%) + 0.75% bank spread = 4.00% effective rate. All scenarios assume 25-year tenure.
| Loan Amount | Current Rate | Monthly Payment | +0.25% | +0.50% | -0.25% |
|---|---|---|---|---|---|
| $500,000 | 4.00% | $2,639 | $2,709 (+$70) | $2,779 (+$140) | $2,571 (-$69) |
| $1,000,000 | 4.00% | $5,278 | $5,417 (+$139) | $5,558 (+$280) | $5,141 (-$137) |
| $1,500,000 | 4.00% | $7,918 | $8,126 (+$209) | $8,337 (+$420) | $7,712 (-$206) |
| $2,000,000 | 4.00% | $10,557 | $10,835 (+$278) | $11,117 (+$560) | $10,283 (-$274) |
Key Insight
Impact by Market Segment
Different market segments carry different average loan sizes, making SORA movements affect buyers unevenly.
| Segment | Typical Loan | Monthly Payment | Impact of +0.25% | Avg PSF | Volume |
|---|---|---|---|---|---|
| Core Central Region (CCR) | $2,000,000 | $10,557 | +$278/mo | $2,507 psf | 249 |
| Rest of Central Region (RCR) | $1,500,000 | $7,918 | +$209/mo | $2,273 psf | 515 |
| Outside Central Region (OCR) | $1,000,000 | $5,278 | +$139/mo | $2,091 psf | 2,225 |
SORA Rate Trend
3-Month Compounded SORA over the last 8 quarters.
| Period | 3M SORA |
|---|---|
| Q1 2026 | 3.2500% |
Should You Refinance?
Rates remain near recent highs. Unless your current package is significantly above market rates, refinancing may not yield sufficient savings after factoring in legal costs and clawback penalties.
Try our Refinancing Calculator→The generator’s mortgage scenarios crystallise what 4.00% effective (3.25% SORA + 0.75% spread) means in dollar terms across common loan sizes over a standard 25-year tenure:
| Loan Amount | Monthly @ 4.00% | Monthly @ 3.75% (−25bp) | Monthly @ 4.25% (+25bp) |
|---|---|---|---|
| $500,000 | $2,640 | $2,572 | $2,710 |
| $800,000 | $4,224 | $4,115 | $4,335 |
| $1,000,000 | $5,280 | $5,144 | $5,419 |
| $1,500,000 | $7,920 | $7,716 | $8,129 |
| $2,000,000 | $10,560 | $10,288 | $10,838 |
A 25-basis-point move in SORA translates to roughly $68 per $100,000 of loan per month — meaning a borrower with a $1.5M loan faces a swing of approximately $200–$210 per month for every quarter-point shift. That asymmetry matters: rates could rise faster than they fall, and floating-rate holders bear the full upside risk. Use ShiokNest’s mortgage calculator to stress-test your own loan at current and shock rates (as of 2026-Q2).
The refinancing calculus at these levels rewards precision. The rule of thumb — “refinance when you can save 50bp or more” — holds broadly, but the true breakeven depends on legal and valuation fees typically totalling $2,000–$3,000 for private properties. At a $1M loan, a 50bp saving generates approximately $420 per month; with $2,500 in fees, you recover costs within six months and are firmly ahead by month 12. Borrowers who locked 3-year fixed packages in 2023 at 3.5%–3.7% are coming off lock-in now and face a choice: reprice onto current SORA-float at 4.00%, or seek a new 2-year fixed at roughly 3.50%–3.65% from a competing bank. The refinancing calculator handles this breakeven comparison precisely. See MAS residential property loans guidance for the regulatory framework.
Total Debt Servicing Ratio (TDSR) tightens meaningfully at 4% effective versus the 2021 sub-1% era. Under MAS rules, total monthly debt obligations (including the mortgage) cannot exceed 55% of gross income. For a borrower with $10,000 gross monthly income, the TDSR cap is $5,500. If existing commitments (car loan, credit card minimum payments) consume $1,000, the maximum mortgage payment is $4,500 — supporting a loan of roughly $852,000 at 4.00%/25y. At 2021’s effective rate of 1.75% (0.20% SORA + 1.55% spread), the same income could support approximately $1.17M. That 4-percentage-point rise has compressed loan quantum by over 25% for borrowers at the TDSR ceiling. The TDSR/MSR affordability calculator runs this analysis with your actual figures. See the MAS TDSR and cooling measures explainer for full details.
Property investors face the starkest arithmetic. Singapore’s gross rental yields on private condos sit broadly in the 2.5%–3.5% range depending on segment and unit size. At a 4.00% effective mortgage rate, most investor-grade units are in negative carry territory — the monthly interest cost exceeds rental income before accounting for property tax, management fees, and vacancy. An investor who borrowed $1.5M to purchase a unit yielding 3.0% gross ($45,000/year or $3,750/month) is paying $7,920/month in mortgage service — a negative carry of over $4,000/month. This dynamic suppresses speculative demand and is partly by design: MAS and government cooling measures together make leveraged flipping prohibitively costly. For a full yield-versus-financing breakdown, the buy-to-rent ROI calculator integrates current rate assumptions (as of 2026-Q2).
[
{
"buyer_type": "First-time Singapore Citizen buyer",
"action": "At 4.00% effective, your monthly obligation is predictable but elevated. If your TDSR headroom is comfortable (below 45%), you can tolerate some SORA drift on a floating package; if you are close to the 55% TDSR ceiling, lock a 2-year fixed at ~3.50% to avoid being squeezed by a 25–50bp rate rise. Use CPF OA strategically — prepaying reduces outstanding principal and future interest exposure."
},
{
"buyer_type": "HDB upgrader (second property)",
"action": "TDSR is the binding constraint at 4.00%. Model your combined monthly obligations (existing HDB loan or mortgage + new condo mortgage + car loan) against 55% of gross household income. At $15,000 household income, the TDSR cap is $8,250 — a $1.2M condo loan at 4%/25y alone consumes $6,336. Sequence carefully: selling the HDB before purchasing reduces concurrent obligations and frees TDSR headroom."
},
{
"buyer_type": "Property investor (buy-to-rent)",
"action": "Negative carry is the base case at current rates. A $1.5M unit generating 3.0% gross yield ($3,750/month) costs $7,920/month in mortgage service — a negative carry of ~$4,170 before tax and maintenance. Investor viability requires either a gross yield above 4.5% (rare in CCR/RCR today) or a significant equity buffer that limits the loan quantum."
},
{
"buyer_type": "Refinancer (existing floating-rate SORA package)",
"action": "If you are currently on SORA + 0.85% or higher (all-in ~4.10%), refinancing to a competing bank’s package at SORA + 0.70% (all-in ~3.95%) saves ~$83/month on a $1M loan — recovering $2,500 in fees in 30 months. But the more compelling option is locking a 3-year fixed at ~3.55%: a 45bp saving versus current float generates ~$375/month on $1M, recovering fees in 7 months and providing full rate certainty through 2029."
},
{
"buyer_type": "Floating-rate holder stress-testing risk",
"action": "Apply a 50bp upward shock to your current rate and check whether monthly obligations remain manageable and within TDSR limits. On a $2M loan at 4.00%, a 50bp rise to 4.50% adds ~$560/month ($13,440 annually). If that stress scenario pushes your TDSR above 55% or strains your monthly cash flow, consider repricing to a fixed package now while fixed rates are temporarily below floating rates."
}
]
- Model your mortgage at current rates. Run the mortgage calculator using a 4.00% effective rate (3.25% SORA + 0.75% spread) for your loan amount and tenure. Also input the stress scenario at 4.50% to confirm your monthly obligations remain within TDSR limits. Verify the latest published 3M SORA on the MAS dashboard before finalising assumptions.
- Calculate your refinancing breakeven. If you are on a floating SORA package above SORA + 0.80%, or coming off a fixed lock-in, use the refinancing calculator to model breakeven months against $2,000–$3,000 in fees. A 50bp saving on a $1M loan typically recovers costs within six months.
- Check your TDSR headroom. Use the TDSR/MSR affordability calculator to confirm your combined monthly debt obligations (mortgage + car + other) stay below 55% of gross income at 4.00% effective — and again at 4.50% as a stress buffer. Upgraders with concurrent loans should model both the existing and new obligations simultaneously.
- Compare loan packages side by side. The loan comparison calculator lets you enter two or three packages (e.g., SORA + 0.70% float, 2-year fixed at 3.50%, 3-year fixed at 3.65%) and see total interest cost and monthly obligation over your chosen tenure.
- Track SORA daily. The MAS SORA dashboard publishes the overnight, 1-month, and 3-month compounded rates every business day. Monitor the 3-month rate weekly during periods of macro uncertainty — a sustained 3-day move above 3.40% may signal a rate re-acceleration worth acting on. Reference the MAS residential property loans guidance for repricing rules.
- Optimise your CPF deployment. Use the CPF optimizer to model whether to direct OA funds to mortgage prepayment (saves 4.0% interest) or hold them in OA (earns 2.5%). Review the CPF Board home ownership portal for accrued-interest mechanics.
Bull case — lock fixed now, benefit later. The optimistic reading of flat Q2 2026 SORA is that the rate cycle has genuinely plateaued. Banks are currently offering 2-year fixed packages at approximately 3.45%–3.65% and 3-year packages near 3.55%–3.75% — a rare moment when fixed rates are actually below the equivalent floating rate. Borrowers who lock a 3-year fixed now effectively buy insurance against a re-acceleration: if SORA climbs back toward 3.80% on renewed inflationary pressure, fixed-rate holders sit out the pain. From a portfolio perspective, predictable monthly obligations also simplify CPF and cash-flow planning during an uncertain macro environment. Refer to the URA property data portal for live transaction context (as of 2026-Q2).
Bear case — geopolitical shocks and the floating-rate tail risk. The pessimistic reading is that the April 2026 MAS tightening — driven explicitly by external energy disruptions — signals a risk environment that SORA markets have not fully priced. If tensions escalate, a 50–100bp SORA spike toward 3.75%–4.25% cannot be ruled out. Floating-rate holders on a $1.5M loan would see monthly payments jump from $7,920 to $8,340–$8,770, a $420–$850 monthly shock. Unlike the S$NEER band adjustments that affect import costs gradually, SORA moves are felt immediately in the next monthly mortgage statement. Borrowers near their TDSR ceiling are the most exposed — a 50bp rise may trigger a technical breach if other debt obligations remain constant. The flat Q2 reading offers comfort; it does not eliminate the tail.
Frequently Asked Questions
What is the current 3-Month SORA rate in Q2 2026?
How much does a 0.25% SORA increase affect my mortgage?
Should I choose a fixed or floating rate mortgage?
When should I refinance my mortgage?
How does the 0.75% bank spread work on top of SORA?
When a bank offers a SORA-pegged mortgage, the actual rate you pay is the compounded 3-month SORA plus a fixed spread, typically 0.60%–0.90% depending on the bank, loan type, and competitive environment. If 3-month SORA is 3.25% and your spread is 0.75%, your all-in mortgage rate is 4.00%. The spread is fixed for the duration of your package; only the SORA component floats. When comparing packages, always compare total all-in rates, not just spreads in isolation (as of 2026-Q2).
Will SORA drop in 2027?
Market consensus (as of Q2 2026) suggests 3-month compounded SORA will drift gradually lower through late 2026 and into 2027, contingent on global rate conditions. UOB and other local banks have projected SORA approaching 2.50%–3.00% by end-2026 if US Federal Reserve cuts resume, with a further drift toward 2.00%–2.50% by end-2027. However, the April 2026 MAS tightening introduced an upside risk scenario where SORA remains elevated or rises further if commodity inflation persists. No rate forecast below 12 months is reliable; borrow and plan at current rates, not forecast rates.
What is the difference between SORA and the old SOR/SIBOR?
SOR (Swap Offer Rate) was based on USD/SGD forex swaps and imported US dollar rate volatility directly into Singapore mortgages — it was discontinued after the LIBOR scandal exposed benchmark manipulation risks globally. SIBOR (Singapore Interbank Offered Rate) was a forward-looking rate based on bank submissions rather than actual transactions. SORA, by contrast, is backward-looking: it is computed from actual overnight interbank lending transactions executed during each business day, then compounded over 1, 3, or 6 months. This makes SORA more robust, transparent, and anchored to real market activity. MAS mandated the full transition to SORA by end-2024.
Should I wait for SORA to drop before buying a property?
Timing interest rates is notoriously difficult, and attempting to do so can result in missing out on the right property at the right price. A 50bp drop in SORA (from 3.25% to 2.75%) reduces monthly payments by roughly $280 on a $1.5M loan — significant, but often less than a single quarter’s price appreciation on a well-located property. If your income, TDSR headroom, and cash flow are comfortable at 4.00% effective and you can stress-test at 4.50%, the rate environment is manageable.
Methodology & Sources
Figures below are drawn from Q2 2026 SORA analysis and revised every quarter.
Transaction data sourced from URA REALIS.
- SORA rates: MAS SORA dashboard.
- Mortgage spread: typical bank spread of 0.75% above 3M Compounded SORA.
- Transaction data: URA REALIS.
We report medians (not means) so a single outlier transaction cannot skew district-level figures. PSF = price per square foot.