Condo leasing volumes up 16.8% in June; demand for HDB rentals muted: SRX, 99.co
Condo rents are flat month on month, based on flash data
LEASING volumes for condominiums recovered in June, rising 16.8 per cent month on month after declining in May.
Rents, however, were flat amid a mixed performance across all regions, based on flash estimates released by SRX and 99.co on Thursday (Jul 18).
Rents in the Core Central Region (CCR) fell the most by 1.2 per cent, followed by rents in the suburban areas, or the Rest of Central Region (RCR), which shed 0.3 per cent. In contrast, rents in the Outside Central Region (OCR) rose 0.8 per cent.
Year on year, condo rents were down 4.7 per cent. All regions registered price decreases, with the CCR, RCR and OCR down 5.7 per cent, 4.6 per cent and 3.9 per cent, respectively.
Market watchers believe there is still room for prices to decrease as supply continues to rise amid a high interest-rate environment and persistent market uncertainties.
Furthermore, the job market remains weak. Any slack could reduce the demand for foreign talent, said Nicholas Mak, chief research officer of Singapore property portal Mogul.sg.
A NEWSLETTER FOR YOU
Tuesday, 12 pm
Property Insights
Get an exclusive analysis of real estate and property news in Singapore and beyond.
This, coupled with stricter requirements on hiring foreigners, could reduce demand for foreign labour, which will impact rental volume as these talents are a main source of leasing demand, he noted.
Mak believes this could push SRX and 99.co’s condo rental index downwards by another 5 to 9 per cent in the next six months.
According to the flash data, the number of condo units rented stood at 6,020 units in June, versus 5,155 units in May. Year on year, rental volumes were up 3.5 per cent, but 4.2 per cent lower than the five-year average volume for the month of June.
By region, 37.5 per cent of total volumes came from the OCR, followed by 32.9 per cent from the RCR and 29.6 per cent from the CCR.
Leasing demand in the Housing and Development Board (HDB) market was more muted in June, with slight recoveries in both rental prices and volumes.
HDB rents were up 0.5 per cent from the same period a month earlier and rose 5.5 per cent year on year.
Notably, rents in mature estates rose 1.2 per cent, while rents in non-mature estates inched down 0.2 per cent. Compared to the same period last year, rents in mature and non-mature estates were up 5.7 per cent and 5.2 per cent, respectively.
Among room types, executive flat rents appreciated the most by 1.6 per cent on the month, followed by three-room flats at 1.2 per cent and four-room flats by 0.1 per cent.
Year on year, all room types recorded rent increases. Bigger HDB flats led price gains, with executive flat rents rising the most at 7.3 per cent, followed by five-room flats, which advanced 5.8 per cent. Three-room flat rents were up 5.2 per cent, while four-room flats were up 5 per cent.
HDB rental volumes, meanwhile, increased 2.7 per cent on the month to 2,629 flats, compared with 2,560 units in May 2024.
Year on year, however, leasing volumes fell 13.5 per cent, and were 12.4 per cent lower than the five-year average volume for June 2024.
ERA Singapore head of research and market intelligence Wong Shanting attributed the year-on-year decline to fewer HDB flats being up for rent in H1 2024. The number of rental transactions in the period was 8.5 per cent lower than in H1 2023, she said.
For Christine Sun, chief researcher and strategist at OrangeTee Group, the slowdown was due to the drop in domestic and foreign demand. Additionally, many Singaporeans no longer need to rent a unit as they have moved into their new homes and some expats have left Singapore due to lay-offs or inflationary pressures.
“Some expats may also consider the rents to be less competitive than those in some other first-tier cities. However, as rents continue to moderate, more expats may return to Singapore,” Sun noted.
By room type, four-room flats had the highest leasing volume at 37.2 per cent, followed by three-room flats at 33.9 per cent, five-room flats at 23.5 per cent and executive flats at 5.5 per cent.
Copyright SPH Media. All rights reserved.
