July rents for condos up as HDB rentals fall

[reporter2]

July rents for condos up as HDB rentals fall

Aug 11, 2017

Rupali Karekar


Rents increased for condominiums and private apartments last month but slipped for HDB units, according to SRX Property flash estimates released yesterday.

Experts attributed the rise in private rents to an increased supply of condominiums suited to higher-income tenants.

Private residential rents rose 0.2 per cent month on month in July, less than June's revised 0.6 per cent increase. They were 18.9 per cent lower than their January 2013 peak. Year on year, however, rents slipped 2.7 per cent for private condominiums.

Scotia Real Estate Group chief investment officer Francis Tan said: "The market seems dynamic as more highly qualified foreigners with higher spending power entered the tenancy market."

Barring any major shocks to the economy, or a change in policy, the private rental market will continue to do well for the second half of the year, he said, as more corporate entities set up shop on the island and hire more qualified workers.

HDB rentals, on the other hand, slid 0.1 per cent from June and were down 4.2 per cent from July last year. They were 13.6 per cent down from their peak in August 2013.

Rents in mature estates decreased by 0.2 per cent, while those in non-mature estates rose 0.1 per cent, SRX Property data stated.

Stricter immigration policies in recent years have seen a dwindling number of low skilled workers, which may have had an impact on demand for HDB units, Mr Tan said.

An estimated 1,835 HDB flats were rented in July, a 6.7 per cent increase from the 1,720 units in June. Year on year, rental volume increased by 1.2 per cent. By comparison, 4,834 condo units were rented out in July, an 11.8 per cent jump over June's 4,322 units

Mr Wong Xian Yang, head of research and consultancy at Orangetee Research, said an abundance of private units were on offer as many projects reached completion last year.

The HDB rental market is feeling the pressure of "an economy that is doing well and the availability of more condos, as many tenants chose facilities offered by private apartments," he said.

Mr Wong expects the private rental market to stabilise by next year .

[reporter2]

Private condo rents in July up 0.2% as rental volume rises: SRX Property

The gain comes on the heels of June's 0.6% increase, revised from 0.5% previously; CCR and OCR register upticks but RCR dips

August 11, 2017

Lynette Khoo


RENTS of private non-landed homes in Singapore climbed 0.2 per cent in July compared to June, while rental volume rose by 11.8 per cent from a month ago to 4,834 units, going by flash estimates from SRX Property.

This was buoyed by the 0.3 per cent and 0.4 per cent uptick in the Core Central Region (CCR) and Outside Central Region (OCR) respectively, while the Rest of Central Region (RCR) saw a 0.1 per cent dip.

It also followed a 0.6 per cent rental increase islandwide in June, a revised figure from 0.5 per cent, SRX Property said on Thursday.

While rents in the public housing market continued to slip by 0.1 per cent in July from June, dragged by rental falls in bigger flats, the decline is more moderate than the 0.8 per cent drop in June.

Rental volume for HDB flats in July also grew 6.7 per cent from June to an estimated 1,835 transactions.

The latest data seems to suggest that both private non-landed and HDB rental markets are stabilising and the declines are likely to ease further. But property consultants are still expecting continued rental weakness to persist till at least next year.

"I believe the leasing market is slowly finding a bottom, especially with fewer completions in the pipeline," said Lee Nai Jia, who heads research at Edmund Tie & Company.

"Notwithstanding, the rental market remains largely subdued and only rents of properties in choice locations close to either MRT stations or growth clusters remain resilient."

Dr Lee is projecting a 1.5-2.5 per cent easing of rents for private non-landed homes for the whole of 2017, and rents to slide further by 1-3 per cent next year.

ZACD Group head of research and consultancy Nicholas Mak reckoned that the earliest for private non-landed rentals to recover in a sustained manner would be next year, depending on the strength of the employment market.

This year, there will be around 16,400 private homes being completed - almost double the number of homes to be completed each in 2018 and 2019, he said.

"The mismatch between supply and demand will continue to weigh down on the occupancy rate as well as rentals of residential properties this year."

Non-landed private rents in July remained 0.1 per cent lower from the beginning of the year, SRX Property data shows.

Compared to a year ago, private non-landed rents islandwide were still down 2.7 per cent in July, with all regions - CCR, RCR and OCR - posting declines of 1.9 per cent, 3.8 per cent and 2.5 per cent, respectively.

Non-landed private rents in July were 18.9 per cent lower compared to its peak in January 2013.