Condo rents dip again in June but may get lift from Hong Kong unrest; HDB rents inch up

Condominium and private apartment rents dipped 0.2 per cent in June from May, after inching down by the same rate in May.
Condominium and private apartment rents dipped 0.2 per cent in June from May, after inching down by the same rate in May.PHOTO: ST FILE

SINGAPORE - Rents for non-landed private properties continued to soften for the second straight month while they edged up again for HDB flats, according to flash data from real estate portal SRX Property.

Condominium and private apartment rents dipped 0.2 per cent in June from May, after inching down by the same rate in May.

Going by location, private rents dipped 0.5 per cent in the core central region (CCR) last month, fell 1.1 per cent for the outside central region (OCR), and rose 0.9 per cent for the rest of central region (RCR).

Year on year, private rents were a modest 1.9 per cent higher, with all regions in Singapore seeing increases: 2.7 per cent for the CCR, 2.1 per cent for the RCR and 1.0 per cent for the OCR.

Compared to their peak in January 2013, private rents in June were down 17.5 per cent.

The number of condos and private apartments leased fell 4.2 per cent month on month and 6.4 per cent year on year to 4,704 units in June.

Despite the fall in rental volume, the number of transactions rose 0.9 per cent on a quarterly basis from 14,492 units in the first quarter of this year to 14,622 units in Q2.

This is "within expectations" as it is currently the season where more expats renew or sign new contracts in the second and third quarters of the year, said Christine Sun, OrangeTee & Tie head of research and consultancy.

 
 
 

Ms Sun added that the current political and social unrest in Hong Kong might "destablise" the country's reputation as a stable financial hub, which might lead to investors worrying about the financial and economic risks of operating businesses there.

"They may consider shifting their operations or headquarters to Singapore in the longer term, which will benefit the rental market here," she added.

In the HDB market, rents rose by 0.4 per cent in June, for a second straight monthly rise, after inching up 0.1 per cent in May. This was on the back of four-room flat rentals which rose 1.2 per cent in June, while rents for three-room, five-room and executive flats slipped 0.3 per cent, 0.1 per cent and 0.6 per cent respectively.

Rents in both mature and non-mature estates also saw slight increases, with mature estates seeing a 0.7 per cent rise and non-mature estates adding just 0.1 per cent.

Year on year, HDB rents rose by 1.4 per cent, with mature estates rates up 2.0 per cent and non-mature estates rising 0.6 per cent.

Month-on-month HDB rental volume decreased 3.1 per cent with 1,878 HDB flats rented out, down from 1,938 units in May. But compared to a year ago, the number of HDB flats leased was up by 1.2 per cent.

Ms Sun said some downward pressure on HDB rents is expected in the coming months due to an increasing supply of rental flats as more flats reach their five-year minimum occupation period, hence being eligible for leasing.