HDB, condo rentals fall in January as volumes increase: SRX and 99.co
The HDB rental market’s decline could be temporary, as higher volumes indicate a firmer demand. HDB continues to attract tenants who are looking for affordable accommodations. Should the decline in condo rentals deepen, this could close the gap. Some HDB tenants might then be tempted by the lower rents in condos. HDB rents will then likely start to consolidate, and may even move southwards.
Rents in the OCR increased by 2.4%. Rentals in the CCR fell by 0.7 per cent and in the RCR, they dropped by 0.6 per cent.
Condo rental prices have declined for the sixth consecutive month, falling by 4.3 percent from their previous highs. This is due to the increased supply of condos last year.
The leasing of rental units is difficult for landlords. In addition to higher mortgage payments and property taxes, the increasing number of layoffs has also led to lower tenant demand. Some landlords prefer to reduce rents over leaving their units vacant.
Private rental volumes increased by 6.2%, from 5.665 units to 6,016 units estimated in January 2024.
The latest figure is 4.6 per cent less than the previous year and 13 per cent below the five-year January average.
According to the OCR, 38.5% of all condo rentals are from this region. 32.6% come from the RCR, and 28.8% from the CCR.
Demand for private rental properties has increased since the holidays of the year end, as many tenants have renewed or signed new leases at the beginning 2024. Due to the Chinese New Year, experts have noted a decline in condo rentals for February. This is because landlords don’t usually allow their properties to be viewed during this time.
HDB rental prices were also lower, with a decrease of 0.7 percent from December 2023. This was due to a decline in rents for both mature and un-mature estates, which fell by 1.2 percent and 0.3 percent respectively.
HDB January rents were unchanged for units with four rooms, but three-room rental rates fell 1.2 percent and executive flats rents dropped 3 per cent. Five-room rentals dipped 0.6 per cent. Overall, rents increased 8.6% from January 2023 to date.
All room types saw record rent increases. Starting with the five-room units, which increased by 9.2 per cent on an annual basis. It was followed by executive units (8.1%), four-room units (8.7%) and 3-roomers (7.8%).
The HDB rental market has grown by 4.6 per month to 3,024 estimated flats, compared with 2,892 in January 2023. That’s a 5.3 percent increase over the January 2023 level and 1.4 percent more than the five-year January average.
HDB rents were dominated by four-room apartments, with 38.4% of all rentals.
Renting four-room apartments has increased since December 2023, when this type of flat contributed 36.2% of the total volume.
Tenants may have opted to be more cautious as Singapore’s economy has experienced more retrenchments and rented a smaller, more affordable flat.
In terms of the overall increase in rental volume for HDB and condominiums, it is possible that tenants were more inclined to enter the market after seeing a significant drop in rental price compared with six months ago.
This is also a good opportunity for them to negotiate a cheaper rental rate on the condo rental market.
She thinks that there is little chance of an increase in HDB rent prices. She said: Even if the prices rose, it would most likely affect smaller HDB units as couples that take advantage of this scheme will not usually lease larger flats for cost reasons. The impact of vouchers on rental prices and demand will be determined by how many people are eligible for them and their amount.
Private and public housing rental prices continued to fall in the first of the year. Housing and Development Boards (HDB) and condominium rental prices both posted a 0.7 percent decrease from December 2023.
SRX and 99.co’s flash data released on February 20 showed that the Core Central Region – CCR – was the only one to record rental growth of 0.4 percent, while the rents for the Rest of the Central Region – RCR – declined by 1.6 percent. Outside Central Region – OCR – also saw a decline of 1 per cent.
