HDB Loan Interest Rate Trends Analysis 2026 | Homejourney
HDB loan interest rates remain fixed at 2.6% p.a. (CPF OA + 0.1%), but bank loans for HDB flats have dropped to 1.45%-1.75% in early 2026, making refinancing attractive for eligible owners. This HDB Loan Interest Rate Trends Analysis breaks down current trends, SORA movements, and fixed vs floating options to help you decide. At Homejourney, we prioritize your safety with verified data and tools like live rate comparisons on our bank rates page.
Current HDB Loan vs Bank Loan Rates in 2026
The HDB concessionary loan holds steady at 2.6% p.a., pegged to the CPF Ordinary Account rate plus 0.1%.
Bank loans for resale HDB flats now offer promotional fixed rates as low as 1.45%-1.55% for the first two years, with floating rates around 1.15%-1.50% based on 3M SORA + margin.[1][3]
Here's a snapshot of top rates for resale HDB in February 2026:[1]
- Best 2-Year Fixed: Promo 1.55%, Maybank 1.65%, DBS 1.75%
- Best Floating: Promo 1.15% (SORA-based), DBS FHR6 competitive
For refinancing, DBS stands out with rates from 1.55% fixed and $2,000 cashback for loans over $200k, offsetting fees.[1][3]
Bank rates have fallen below HDB's 2.6%, driving a surge in switches—DBS POSB HDB loans up 13x year-on-year.[3] Note: Once you switch to a bank loan, you cannot revert to HDB financing.[3][5]
Understanding SORA and Its Impact on HDB Loans
SORA (Singapore Overnight Rate Average) is the key benchmark for floating HDB bank loans, replacing older rates like FIXPEG. 3M Compounded SORA + 0.70%-1.00% is common (e.g., UOB packages).[2]
3M SORA hit 3.6% in 2023 but fell to ~1.34% by late 2025, now stabilizing at 1.3%-1.4%.[5] Forecasts predict 1.0%-1.2% through 2026 absent shocks.[6]
This decline means monthly payments on a $400k loan drop ~$3,600/year vs HDB rates.[5] Track live 3M and 6M SORA daily on Homejourney's bank rates page.
The chart below shows recent interest rate trends in Singapore, highlighting SORA movements and HDB benchmarks:
As visible, rates are at 3-year lows, favoring floating options now.[3][5]
Fixed vs Floating Rates: Pros, Cons and HDB Comparison
Fixed rates (e.g., DBS 3-year 1.70%) lock payments for certainty; floating (SORA + margin) offer savings in low-rate environments but risk rises.[1][6]
| Feature | Fixed Rate | Floating Rate | HDB Loan |
|---|---|---|---|
| Rate (2026) | 1.55%-1.75% | ~1.15%-1.50% | 2.6% fixed |
| Risk | Low (lock-in) | Medium (SORA volatility) | None |
| LTV | 75% | 75% | 80% |
| Best For | Risk-averse buyers | Savers in low rates | First-timers |
[1][4][5] Choose fixed if risk-averse; floating for potential savings (e.g., $126k interest on $350k/25yr vs HDB).[1]
HDB Loan Interest Rate Trends Analysis: Key Insights
Rates peaked in 2023 (SORA >3.6%) but declined sharply to 1.34% 3M SORA by Oct 2025, now at 3-year lows.[3][5] Expect modest further drops to 1.0%-1.2% in 2026.[5][6]
Refinancing from HDB surged as banks undercut 2.6%—e.g., POSB 1.55%-1.70% fixed with no early repayment penalty.[3] For CPF HDB purchase or use CPF for HDB, HDB loans suit low-income/first-timers; banks for upgraders.
Insider tip: For resale HDB in mature estates like Toa Payoh, factor TDSR—use Homejourney's calculator at bank-rates#calculator to check affordability with CPF OA for flat or CPF down payment HDB.
Decision Framework: Should You Switch or Stick with HDB?
- Assess Eligibility: HDB for incomes below ceiling, no prior properties; banks require 75% LTV.[4]
- Risk Tolerance: Conservative? Stick HDB 2.6%. Optimistic on rates? Bank floating.[6]
- Calculate Savings: $350k loan: Bank ~$1,478/mth vs HDB $1,604 (25yrs).[1]
- Time Lock-in: Avoid if planning sale soon; check penalties.
- Monitor Trends: Use Homejourney for real-time SORA and multi-bank quotes from DBS, OCBC, UOB, HSBC, etc.
Link to our pillar: HDB Loan vs Bank Loan 2026 Comparison | Homejourney ">HDB Loan vs Bank Loan 2026 Comparison for full details. See CPF for HDB Purchase: Homejourney's Complete Usage Guide ">CPF for HDB Purchase Guide on CPF HDB rules.
Disclaimer: Rates fluctuate; consult professionals. Homejourney verifies data for trust but this is not financial advice.
FAQ: HDB Loan Interest Rate Trends
What is the current HDB loan interest rate?
Fixed at 2.6% p.a. (CPF OA 2.5% + 0.1%). Banks offer lower promo rates ~1.5%.[1][3]
Are bank loans cheaper than HDB now?
Yes, fixed 1.55%-1.75%, floating ~1.15% vs HDB 2.6%. But no reverse switch.[3][5]
How does SORA affect my HDB bank loan?
Floating rates = 3M SORA (~1.34%) + 0.7%-1.0% margin. Track on Homejourney.[2][5]
Can I use CPF for HDB down payment with bank loans?
Yes, up to rules allow; calculate via our mortgage calculator. Details in How to Use CPF for HDB Down Payment: Homejourney Guide ">CPF Down Payment Guide.
Best bank for HDB refinancing 2026?
DBS for low rates + cashback; compare all on Homejourney bank-rates.
Ready to analyze your options? Visit Homejourney's bank rates page—compare DBS, OCBC, UOB rates, calculate payments, and apply via Singpass for instant offers. Search HDB flats at property search within budget. Trust Homejourney for safe, transparent property journeys.
