Condo, HDB rental prices hit record highs in April; fewer units leased

This marks the 16th straight month of growth for condo rents and the 22nd for HDB rents. PHOTO: ST FILE

SINGAPORE - The rental prices for Housing Board flats and private apartments continued to rise in April, hitting new highs in both markets, while leasing volumes dipped.

Condominium rents last month surpassed the previous peak in January 2013 by 1.8 per cent, while HDB rents saw a record increase year on year, according to flash figures from real estate portals and SRX released on Wednesday (May 11).

Overall, condo rents rose by 2.3 per cent compared with March's 2.9 per cent, and HDB rents climbed at a quicker pace of 1.9 per cent compared with 1.4 per cent the month before.

This marks the 16th straight month of growth for condo rents and the 22nd for HDB rents.

HDB rents set a record across all flat types in both mature and non-mature estates, rising 13.2 per cent for three-room, 14.7 per cent for four-room, and 15.1 per cent for five-room flats compared with April last year.

In March, HDB rents surpassed the previous peak of August 2013 by 1 per cent.

Rental growth for condos was observed across the board, in central Singapore, city fringes and the suburbs. Year on year, condo rents were up 15.1 per cent from April last year.

The most condo units rented were in the suburbs, accounting for 38.1 per cent of total rental volume.

Property analysts said low rental stock and a lack of new homes caused by construction delays drove up rents.

ERA Singapore head of research and consultancy Nicholas Mak said: "Rental rates in both the HDB and condo markets are projected to continue to rise as leasing demand is expected to remain healthy, supported by both local residents and newly arrived foreigners."

OrangeTee & Tie senior vice-president of research and analytics Christine Sun noted that rents rose at a quicker pace in March and April, compared with April to December 2021.

"Rents have been escalating over the past few months, and market resistance could be setting in. More tenants are renting units together to share costs," she said.

This could push some Malaysians to not renew their leases and move back across the Causeway, opting instead to travel to Singapore regularly, Ms Sun added.

But Huttons Asia chief executive Mark Yip said many Malaysians are unsure if the borders will stay open indefinitely.

"They are adopting a wait-and-see attitude and renewing their lease for a short period of time. This supported HDB rents in April," he said.

Rental volume for the condominium market dipped 21 per cent to an estimated 3,551 units last month, compared with 4,497 in March.

Fewer HDB flats were also leased last month, down by 20.7 per cent to an estimated 1,382 units, compared with 1,743 units the month before.

Rental volume in both markets dropped to the lowest level since May 2020, when the property markets were restricted by the circuit breaker, noted Mr Mak.

"The border reopening in April caused some Malaysian workers to rethink their accommodation plans, leading to a drop in the number of new leasing transactions last month," he said.

As rental stock was low, fewer units were leased and many were snapped up quickly, Ms Sun added.

"Some tenants booked units without viewing them, as competition is stiff and stock is lacking. To secure units quickly, some were transacted above the asking rents," she said.

Mr Mak said more foreigners are expected to move to Singapore for work and study.

"In the coming months, the rental market will undergo a period of adjustment, as some tenants leave and others take their places," he added.

Join ST's Telegram channel and get the latest breaking news delivered to you.