Understanding Singapore Interest Rates in 2026: What Borrowers Need to Know
Singapore's interest rate environment in 2026 presents both opportunities and challenges for mortgage borrowers. The Monetary Authority of Singapore (MAS) has maintained its monetary policy stance while signaling cautious optimism about economic growth, with the Singapore Overnight Rate Average (SORA) currently trading at 1.05%[3]. Understanding how these rates affect your mortgage decision is crucial whether you're a first-time buyer, upgrader, or refinancing your existing loan.
The key to smart mortgage planning in 2026 is understanding the relationship between Singapore's benchmark rates and your monthly loan payments. Unlike many countries, Singapore doesn't have a traditional policy interest rate. Instead, MAS manages monetary policy through the Singapore dollar's exchange rate against a basket of trading partner currencies[1]. This unique approach means mortgage rates are primarily determined by SORA, the actual overnight interbank lending rate, rather than a central bank policy rate.
For borrowers, this translates to floating mortgage rates that adjust based on real market conditions. In January 2026, SORA ranged between 0.93% and 1.45%, compared with 3.41% to 3.82% in January 2024—a significant decline that has reduced borrowing costs considerably[2]. As you plan your mortgage strategy, tracking these SORA movements becomes essential to timing your application and choosing between fixed and floating rate options.
SORA Rates Explained: How Singapore's Benchmark Rate Affects Your Mortgage
SORA (Singapore Overnight Rate Average) is the benchmark interest rate that determines most floating-rate mortgages in Singapore. It's based on actual overnight interbank borrowing transactions, making it a real-world reflection of lending conditions[2]. When banks offer you a floating mortgage rate, they typically quote it as "SORA + spread," where the spread is the bank's margin above the benchmark rate.
Currently, SORA is expected to trend around 1.00% by end of Q1 2026, with long-term projections suggesting a move toward 1.50% in 2027[3]. This gradual upward trajectory is important for mortgage planning because it affects both your monthly payments and your refinancing decisions. If you're considering a floating rate mortgage, understanding SORA's direction helps you assess whether rates might rise or fall during your loan tenure.
The chart below shows recent SORA trends to help you understand how rates have moved in the current market cycle:
As you can see from the chart, SORA has stabilized in the 1.00-1.05% range after declining significantly from 2024 highs. This stability creates a relatively predictable environment for mortgage planning, though geopolitical risks and global economic shifts could alter this trajectory. Banks like DBS, OCBC, UOB, and HSBC adjust their mortgage spreads based on SORA movements, so comparing rates across lenders becomes crucial when SORA reaches inflection points.
Fixed vs Floating Rates: Which Mortgage Option Suits Your 2026 Strategy?
The choice between fixed and floating rate mortgages depends on your risk tolerance, financial stability, and outlook on future rate movements. In February 2026, fixed deposit rates range from 1.20% to 1.50% p.a.[5], which provides a benchmark for understanding fixed mortgage rates offered by banks. Fixed rates offer payment certainty—your monthly installment remains constant throughout the loan tenure, making budgeting predictable and protecting you against rate increases.
Floating rates, tied to SORA, currently offer lower initial payments since SORA is at 1.05%[3]. However, your monthly payment adjusts when SORA changes, typically every three or six months depending on your loan agreement. With SORA expected to gradually rise toward 1.50% in 2027, floating rate borrowers should prepare for potential payment increases over the next 12-24 months.
Consider a fixed rate if you have a tight monthly budget, plan to stay in your property long-term, or believe rates will rise significantly. Choose a floating rate if you have financial flexibility, expect rates to remain stable or decline, or plan to refinance within 3-5 years. DBS CEO Tan Su Shan noted that 2026 is expected to see net interest income slightly below 2025 levels, suggesting banks may maintain competitive spreads to attract borrowers[2]—making this a favorable time to compare offers across major lenders.
Current Market Outlook: MAS Policy and 2026 Rate Predictions
The MAS held monetary policy unchanged in January 2026, maintaining the Singapore dollar's exchange rate policy band[1]. This decision reflects confidence in Singapore's economic resilience, with GDP growth expected to remain solid despite moderating global growth. However, MAS raised its 2026 inflation forecast to 1.0-2.0% from the previous 0.5-1.5%, signaling awareness of inflationary pressures from geopolitical tensions and oil prices[1].
For mortgage borrowers, this inflation outlook matters because it influences whether MAS might adjust its policy stance later in 2026. If inflation accelerates beyond the 2.0% upper bound, MAS might tighten policy, which could push SORA higher and increase floating mortgage rates. Conversely, if global growth weakens significantly—a downside risk MAS acknowledged—policy could ease, benefiting floating rate borrowers[1].
OCBC's 1H 2026 FX and Rates Outlook suggests a 25 basis point rate cut is possible in Q1 2026 as insurance against global slowdown[7]. If this materializes, SORA could dip slightly below current levels, providing a brief window for borrowers to lock in rates before potential upward movement later in the year. This is why timing your mortgage application strategically—using tools like Homejourney's real-time SORA tracking—can meaningfully impact your loan costs.
How Homejourney Simplifies Mortgage Planning in This Rate Environment
Navigating Singapore's mortgage market requires comparing rates across multiple banks, understanding how SORA affects your payments, and submitting applications efficiently. Homejourney's bank rates page consolidates this entire process, allowing you to track live SORA rates (both 3-month and 6-month SORA) updated daily, compare rates from all major banks including DBS, OCBC, UOB, HSBC, Standard Chartered, Maybank, and more—all in one transparent interfaceSingapore Interest Rate Trends 2026: Bank Mortgage Rate Guide | Homejourney .
The platform's mortgage calculator lets you instantly calculate your borrowing power and monthly payments based on current SORA rates and bank spreads. This means you can see exactly how a 0.25% SORA change affects your monthly installment before committing to an application. For first-time buyers assessing affordability, this transparency is invaluable—you avoid surprises and can make informed decisions aligned with your financial situation.
Homejourney's multi-bank application system is particularly valuable in 2026's competitive lending environment. Rather than visiting each bank individually, you submit one application through Homejourney and receive personalized rate offers from all partner banks. Banks can verify your income and employment data instantly using Singpass integration, accelerating the approval process. This approach also ensures you're comparing genuine, personalized offers rather than advertised rates—critical since banks often reserve best rates for qualified borrowers.
For refinancing decisions, Homejourney's step-by-step process guides you through assessing whether switching from fixed to floating (or vice versa) makes financial sense given current SORA levels. With SORA at 1.05% and expected to gradually rise, refinancing from an older fixed rate to a floating rate might seem attractive—but Homejourney's calculators help you quantify actual savings before proceeding.
Strategic Mortgage Planning Steps for 2026
Start by checking your borrowing power using Homejourney's eligibility calculator. This tool considers your income, existing debts, and the Debt Service Ratio (TDSR) limits set by MAS, giving you a realistic picture of how much you can borrow. With SORA at 1.05%, your TDSR calculations are based on current rates—but remember that banks typically stress-test at higher rates to ensure you can afford payments if SORA rises.
Next, use Homejourney's bank rates comparison to see current offerings from DBS, OCBC, UOB, HSBC, Standard Chartered, and other major lenders. Pay attention to the spread (the margin above SORA) each bank offers—a 0.1% difference in spread translates to meaningful savings over a 25-year loan. Compare both 3-month and 6-month SORA options, as they typically differ by 10-20 basis points, affecting your rate stability.
Decide on fixed vs floating based on your risk tolerance and rate outlook. If you believe SORA will rise significantly, a fixed rate provides peace of mind despite higher initial costs. If you're comfortable with payment variability and expect rates to remain stable, floating offers lower initial payments. Many borrowers adopt a hybrid approach—fixing part of their loan while keeping the remainder floating.
Finally, submit your application via Homejourney's platform when SORA and spreads align with your strategy. The Singpass integration means your application is processed quickly, and you'll receive competing offers from multiple banks within days. This competitive environment benefits you—banks know you're comparing offers, incentivizing them to provide attractive rates.
Why Homejourney's Trust-First Approach Matters for Mortgage Decisions
Mortgage decisions involve substantial financial commitments—often the largest purchase of your life. Homejourney's platform prioritizes user safety and trustworthiness by verifying all rate information, ensuring transparency in how rates are calculated, and providing clear explanations of terms and conditions. Rather than marketing gimmicks, Homejourney focuses on helping you understand your options so you make confident decisions aligned with your financial goals.
The platform actively incorporates user feedback to improve the mortgage application experience. If borrowers report confusion about SORA mechanics or difficulty comparing fixed vs floating options, Homejourney enhances its educational content and tools accordingly. This customer-centric approach means the platform evolves based on real user needs, not marketing priorities.
Homejourney's mortgage brokers provide personalized guidance throughout the application process. They help you interpret bank offers, explain how SORA changes affect your specific loan, and identify refinancing opportunities aligned with your circumstances. This human element, combined with transparent technology, creates a safe environment where you can make mortgage decisions with confidence.
Frequently Asked Questions About Singapore Interest Rates and Mortgage Planning
What's the difference between 3-month and 6-month SORA mortgages?
3-month SORA adjusts your rate every three months, while 6-month SORA adjusts every six months. 3-month SORA is typically 10-20 basis points lower than 6-month SORA because it carries more frequent adjustment risk. Choose 3-month if you want rates to adjust quickly when SORA falls, or 6-month if you prefer payment stability with fewer adjustments. Homejourney's bank rates page displays both options so you can compare spreads and choose the best fit.
Will SORA rates rise significantly in 2026?
MAS expects SORA to trend around 1.00% by end of Q1 2026, with longer-term projections suggesting movement toward 1.50% in 2027[3]. This gradual increase reflects global rate normalization rather than aggressive tightening. However, geopolitical risks and inflation surprises could accelerate rate increases. Using Homejourney's calculator, you can stress-test your affordability at higher SORA levels (e.g., 1.50% or 2.00%) to ensure you can handle potential increases.
Is now a good time to lock in a fixed rate?
With SORA at 1.05% and expected to gradually rise, fixed rates offer certainty about future payments. Fixed rates in February 2026 are competitive, and locking in now protects you against potential increases later in 2026 or 2027. However, fixed rates are typically 0.30-0.50% higher than floating rates, so calculate the premium you're paying for certainty. Homejourney's mortgage calculator helps you quantify this trade-off based on your specific loan amount and tenure.
How does MAS policy affect my mortgage rate?
MAS doesn't have a traditional policy interest rate. Instead, it manages monetary policy through the Singapore dollar's exchange rate[1]. When MAS adjusts the S$ exchange rate policy band, it influences SORA and ultimately mortgage rates. In January 2026, MAS held policy steady, suggesting rates will remain relatively stable in the near term. However, future policy adjustments would flow through to SORA and your mortgage payments if you have a floating rate.
Can I refinance my existing mortgage to take advantage of lower spreads?
Yes, and 2026 presents a favorable refinancing environment. Banks are competing actively for borrowers, which means spreads may be tighter than when you originally took your loan. Use Homejourney's refinancing calculator to compare your current rate against new offers from DBS, OCBC, UOB, HSBC, and others. Factor in refinancing costs (legal fees, valuation, processing fees), which typically range from S$1,500-3,000, and calculate the break-even point. If you plan to stay in your property beyond the break-even period, refinancing often makes financial sense.
Take Control of Your Mortgage Decision with Homejourney
Singapore's interest rate environment in 2026 offers opportunities for savvy borrowers who understand SORA mechanics, compare rates strategically, and time their applications wisely. Whether you're a first-time buyer, upgrader, or refinancing, Homejourney's bank rates page provides the transparency and tools you need to make confident decisions.
Start by tracking live SORA rates and comparing current offerings from major banks. Use the mortgage calculator to assess your borrowing power and monthly affordability. Then submit your application through Homejourney's platform to receive competing offers from all partner banks. With Singpass integration, the process takes minutes—and you'll have multiple personalized rate offers to evaluate.
For comprehensive guidance on mortgage planning strategy, interest rate trends, and how to optimize your loan application, explore Homejourney's full mortgage resources Singapore Interest Rate Trends 2026: Mortgage Planning Guide by Homejourney . Our platform's commitment to user safety, transparency, and customer-centric service ensures you're making mortgage decisions in a trusted environment where your financial wellbeing comes first.
