Property consultants say landlords are expected to become more flexible given factors such as ongoing job cuts.

In a report released on Thursday Savills Singapore said the onset of a technical recession here, coupled with a weaker employment market and slower expatriate arrivals, will contribute to the fall in rents.

So far, the impact on the local rental market has been limited despite rents beginning to come off their peaks, it said.

'The quarters ahead should, however, see a more entrenched rental decline as demand weakens in the face of a global economic slowdown,' said the report.

Given that the full force of the financial crisis erupted in mid-September, the rental property market has yet to feel the full impact, it said. In terms of top of the market rents, known as prime rents, it expects a fall of 7 to 13 per cent next year.

Another consultancy Knight Frank is projecting a bigger fall of 10 to 15 per cent in average islandwide rents next year.

The Urban Redevelopment Authority (URA) recorded a 0.9 per cent dip in private home rents in the third quarter, the first fall after 17 quarters of growth.

Read the full story in Friday's edition of The Straits Times.