HDB rentals edge up for the first time in 7 months: SRX Property

HDB rents edged up 0.1 per cent month-on-month in March, stopping a decline in prices for the first time since August last year, according to data from SRX Property.

But on a year-on-year basis, rents in March fell 3.5 per cent. The rental prices in March were 5.8 per cent lower than the peak in August 2013, said SRX Property in a news release on Wednesday (Apr 15).

Rents for three- and four-room flats posted an increase of 0.4 per cent month-on-month, but rentals for five-room and executive flats fell 1.3 per cent and 1.8 per cent respectively. On a year-on-year basis, rents in non-mature estates fell 4.1 per cent in March, while rents in mature estates fell 2.9 per cent.

The overall median rental price in the central area was the highest in Singapore, at S$2,725 in March.

However, real estate agency ERA said the rise in rents may be “one-off”, due to monthly fluctuations. Said ERA’s key executive officer Eugene Lim in a release on Wednesday: “Overall, the rental trend points to a decline by 5 to 6 per cent for the whole year.”

In addition, HDB rental volume improved in March. A total of 1,838 HDB flats were rented in March, up 29.4 per cent from 1,420 units in February. However, rental volume in March was 3.8 per cent lower as compared to last year.

ERA attributed this to demand coming from newly-minted Permanent Residents who cannot purchase resale HDB flats for three years.

PRIVATE HOME RENTALS CONTINUE TO FALL

Rental prices for non-landed private residences continued to fall, dropping 0.4 per cent month-on-month in March, said SRX Property. On a year-on-year basis, rents in March fell 6.3 per cent. The rents in March were also 11.1 per cent lower than the peak in January 2013, said SRX Property.

Non-landed private homes in the Core Central Region and the Rest of Central Region fell 0.5 per cent and 0.9 per cent respectively. But rents in the Outside Central Region bucked the trend, rising 0.8 per cent on-month.

ERA said the decrease could be due to a record number of private home completions. “It’s a tenant’s market and they have a lot of choices,” said Mr Lim.

He added that a tighter inflow of expat tenants into Singapore could also be a cause for the decline. Moreover, he said foreigners working in Singapore are increasingly not being provided a separate rental budget, so most would try save by renting cheaper units.

Mr Lim also said landlords may be prepared to accept lower rental rates so as not to leave their property vacant, as they are no longer allowed to apply for vacancy refund on their property tax.

“We expect overall rents to further decline by 6 to 8 per cent for the whole year as more new non-landed properties are slated for completion over the course of the year,” said Mr Lim.

Rental volume for non-landed private homes increased. A total of 3,948 units were rented in March, a 37.1 per cent increase from 2,880 units rented in February. On a year-on-year basis, rental volume in March was 14 per cent higher.

Mr Lim said the overall volume this year is expected to remain high, as existing tenants relocate to better options with existing or lower rental budgets.

The resale prices of non-landed private homes dipped 0.2 per cent on-month in March.

Source : Channel NewsAsia – 15 Apr 2015

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