It was a mixed picture for the local residential leasing market last month with condominium rents resuming their decline as rents for public housing flats rose slightly.
Rents for private condos fell by 0.8 per cent from April to last month, and slumped by 3.9 per cent from May last year, according to flash estimates from SRX Property yesterday.
The decline was led by the prime districts where rents slid by 1.8 per cent from April, followed by drops of 0.5 per cent on the city fringe and 0.4 per cent in the suburbs.
An estimated 4,650 condos were leased last month, up by 12.5 per cent from 4,134 in April.
Analysts told The Straits Times that private home rents are not likely to recover in the next couple of years. PropNex Realty key executive officer Lim Yong Hock said: "Rents could easily fall by 8 to 10 per cent this year. Vacancy rates are expected to climb as well."
The private condo leasing market has been persistently weak owing to challenges including an influx of new units in the market and weaker demand from expatriates.
Softer business sentiment in recent years has led to a more uncertain employment outlook, which also exerts pressure on rentals.
"When the job market recovers, there'll be more leasing demand for homes in the core central region as people want to live closer to their work place in the CBD," noted Mr Nicholas Mak, head of research and consultancy at real estate investment firm ZACD Group.
SRX Property said private condo rents were down by 19.7 per cent last month from a peak in January 2013.
Rents of Housing Board flats, meanwhile, picked up by 0.7 per cent from April to last month, in what Mr Mak deemed as a "statistical blip". When compared with May last year, HDB rents were down by 3.6 per cent. He added: "I expect the HDB rents to possibly fall by 4 to 5 per cent this year. I don't think 2017 is the year we see the rental market recover."
SRX Property said an estimated 1,873 HDB flats were leased last month, almost identical to the 1,872 units rented in April.
Wong Siew Ying