Singapore Rental Market Sees Leasing Slowdown as Rents Stabilize in September 2024

October 18, 2024

CONDOsingapore.com

Leasing activity for both condominiums and Housing and Development Board (HDB) flats declined for the second straight month in September 2024, amid moderating rent trends, according to flash data from SRX and 99.co.

Condo Market: Volumes Dip, Rents Edge Lower

Condo leasing volumes fell 17.2% month-on-month (MoM) to 6,172 units in September, down from 7,456 in August. While year-on-year (YoY) volumes rose 7.7%, they remained 5% below the five-year September average. Rents softened 0.2% MoM, with declines concentrated in the Outside Central Region (OCR: -1.1%), offsetting gains in the Core Central Region (CCR: +0.5%) and Rest of Central Region (RCR: +0.2%). YoY, condo rents fell 3.6%, led by CCR (-4.7%), RCR (-3.2%), and OCR (-3.3%).

HDB Market: Tight Supply Drives Modest Rent Gains

HDB rental volumes dropped 11.8% MoM to 2,314 units, marking a 17.3% YoY decline and an 11.7% dip below the five-year average. Despite weaker demand, overall HDB rents inched up 0.1% MoM, fueled by non-mature estates (+0.3%) and three-room (+0.3%), four-room (+0.2%), and executive flats (+0.2%). Five-room flats saw a slight dip (-0.2%). Annually, HDB rents climbed 3.7%, with executive flats surging 7% YoY.

Expert Insights: Stabilization and Shifting Dynamics

Supply-Demand Shifts

Luqman Hakim, 99.co’s chief data officer, attributed the slowdown to renters delaying decisions as prices stabilize. He noted that 7,000 new condo completions in late 2024 could ease rental tightness, while HDB demand may soften as tenants pivot to newer condos or owners upgrade to private housing.

Market Outlook

Huttons Asia CEO Mark Yip projected flat condo rents for 2024 but flagged potential HDB rent growth (2–3%) as buyers of newly launched condos may rent temporarily. ERA’s Wong Shanting highlighted shrinking HDB supply due to fewer units exiting their minimum occupation period, sustaining upward rent pressure.

OrangeTee’s Christine Sun observed stabilizing private rents, with no growth over the past six months, suggesting a market bottom. She anticipates falling interest rates and possible expatriate hiring to cushion rents, while landlords may negotiate terms amid lower mortgage costs.

Regional Breakdown

Condos: OCR dominated leasing (34.5%), followed by RCR (33.4%) and CCR (32.1%).

HDBs: Non-mature estates outperformed mature ones (+0.3% vs. -0.1% MoM).

Looking Ahead

While condo rents face headwinds from new supply, HDB rents may hold firm on tight inventory. Analysts expect broader stability as economic factors, including interest rates and employment trends, shape tenant and landlord strategies in the coming months.