Condo, HDB rents dip in January; leasing volumes climb

Source: The Straits Times
Author: Isabelle Liew

SINGAPORE - Rents for Housing Board flats and private apartments dipped in January as more units were leased, with analysts noting that landlords have loosened their grip on asking prices.

HDB rents slid by 0.7 per cent in January, reversing the 1 per cent rise in December, flash data from real estate portals Singapore Real Estate Exchange (SRX) and 99.co showed on Feb 20.

Condominium rents were down 0.7 per cent in January, led by rental falls in the suburbs and city fringe. This marks the sixth consecutive month of decline in the private rental market.

Ms Christine Sun, chief researcher and strategist at property firm OrangeTee Group, said that prices have decreased by a total of 4.3 per cent from July 2023 to January 2024, substantially wiping out the 4.9 per cent price growth in the first half of 2023.

Huttons Asia chief executive Mark Yip added: "Tenants had the upper hand in negotiations, forcing more landlords to meet their demand for lower rents."

Compared with January 2023, condo rents were still up 0.4 per cent, with rents in the suburbs climbing by 2.4 per cent. Rents in core central Singapore and the city fringe showed a slight decrease.

ERA Singapore key executive officer Eugene Lim said that landlords have had to face higher mortgage payments and increased property tax, while rising retrenchment numbers have led to softer tenant demand.

"Some landlords would rather compromise on rents than leaving their units vacant for an extended period of time," he added.

HDB rents were 8.5 per cent higher compared with January 2023, with rents across all flat types in both mature and non-mature estates climbing. Five-room units marked the highest growth at 9.2 per cent.

Mr Yip said the price decline in January 2024 may be temporary as demand remains firm year-on-year.

"The HDB rental market continues to attract tenants looking for affordable accommodation," he said. But he noted that if condo rents dip further, some tenants in HDB flats may choose to rent a condo instead, which could cause HDB rents to fall.

Still, Mr Lim expects the HDB rental market to remain resilient in 2024, owing to the limited supply of rental units, particularly in mature estates.

He added that HDB executive flats in the mature town of Clementi recorded the biggest median price increase, from $2,750 in December to $4,300 in January.