by OrangeTee & Tie Pte Ltd.

Condo rents down 0.9% in December

SRX Rental Data

December 2019

Singapore, 15 Jan 2020

Non-landed private rental

For the whole of 2019, 58,236 non-landed rental transactions were recorded, which was 2.3 per cent higher than in 2018. Rental prices had also increased by 3.7 per cent last year. Leasing demand had been robust amid a tightening of new inventory supply and depleting stock in 2019. Last year, the number of completed homes fell for a third consecutive year, and it was about a third of what was completed in 2016. Further, many homes were demolished to make way for newer developments after the last collective sales cycle. As a result, the lower inventory has probably helped to prop up rental prices last year. 

Last month, rental volume for private condominiums shrank for a fifth consecutive month, dipping by 2.8 per cent month-on-month (m-o-m). Leasing demand typically slows down towards the end of the year since many expatriates would be on holidays and those who need to renew or sign new contracts would have already done so. 

Many businesses are expecting Singapore to experience a modest economic recovery this year. Hiring intentions may remain positive for specific sectors such as those in the service, financial services, or technology, which may lend support to the rental market. Moving forward, we estimate that leasing volume may increase slightly this year while rental prices may continue to rise by 1 to 3 per cent. 

HDB rental   

For the public housing segment, the rental market continued to strengthen last year. According to SRX, the rental volume rose 1.9 per cent for the whole year when compared to 2018. Rents had also increased by 1.3 per cent y-o-y. 

The number of leasing transactions may be rising in tandem with the increasing supply of flats being put up for lease last year. According to HDB data, the number of approved applications to rent out HDB flats rose y-o-y in Q3 2019 when compared to the same period in 2018. More flats could be put up for lease after reaching their five-year minimum occupation period. 

As the supply of flats is expected to rise further this year, we estimate that leasing volume may continue to grow while rental prices may flatline or rise marginally by up to 2 per cent for the whole of 2020. 

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