Condo rents fall 0.9% in April; HDB rents rise 0.4%

SRX flash estimates show condo rents down by 19.6% since 2013 while HDB rents are 15.2% below their peak in 2013

Thu, May 10, 2018

Wong Kai Yi

RENTS of non-landed private homes in Singapore fell by 0.9 per cent in April 2018 over March, while rents of HDB flats rose by 0.4 per cent over the same period, according to flash estimates released by real estate portal SRX Property on Wednesday.

Year-on-year, rents for private apartments and condominiums dropped 0.8 per cent from April 2017. They are down by 19.6 per cent from their peak in January 2013.

Going by location, rents in the prime districts or core central region (CCR) slipped the most - by 1.3 per cent. Rents in the city fringes or rest of central region (RCR) and outlying areas or outside central region (OCR) dropped by 1.1 per cent and 0.2 per cent respectively.

SRX Property estimated that some 4,287 non-landed private homes were rented in April 2018, a 10.8 per cent fall from the 4,806 units leased out in the preceding month.

Year-on-year, rental volume in April 2018 was 1.6 per cent lower than the 4,355 units in the year-ago period.

The lower rents may not necessarily signal a downtrend in the private rental market, said OrangeTee's head of research and consultancy Christine Sun.

Rental demand has in fact been robust in some areas from the beginning of this year, especially those in the prime districts, she told The Business Times.

"Rental volume may have dipped because of lesser demand from single tenants. More single tenants or couples have chosen to share a unit as their housing budgets have been reduced on a 'local package'," Ms Sun said.

She observes rental demand increasing in the coming months as more displaced en bloc sellers look for a rental unit while they wait for a replacement home.

"Many sellers prefer larger homes of above 1,400 square feet as they are comfortable with large living spaces," she noted, adding that homes located near the sold collective sale sites should also see higher demand.

Turning to public housing, rents for three-room, four-room and five-room HDB flats increased month-on-month by 0.4 per cent, 0.3 per cent and 0.2 per cent respectively, while rents for executive flats fell 1.5 per cent.

An estimated 1,883 HDB flats were rented in April 2018, which according to SRX data is a 13.7 per cent decrease from the 2,182 units rented in March.

According to SRX's HDB rental price index, rents in April 2018 were down 1.8 per cent from the same period last year, and off by 15.2 per cent from their August 2013 peak.

"The closing gap between public and private home rentals is likely to add further downward pressure on HDB rents, especially in areas where many small-format mass market homes are being completed recently.

"The rents of some smaller condos have dropped to the same level or even lower than some larger HDB flats," OrangeTee's Ms Sun said.