{"id":71339,"date":"2023-11-29T18:05:26","date_gmt":"2023-11-29T10:05:26","guid":{"rendered":"https:\/\/www.99.co\/singapore\/insider\/?p=71339"},"modified":"2023-11-29T18:05:26","modified_gmt":"2023-11-29T10:05:26","slug":"hdb-rental-prices-drop-first-time-since-october-2021","status":"publish","type":"post","link":"https:\/\/www.99.co\/singapore\/insider\/hdb-rental-prices-drop-first-time-since-october-2021\/","title":{"rendered":"HDB rental prices drop for the first time since October 2021"},"content":{"rendered":"
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In the real estate realm, we’re witnessing a dip in condo rental volumes and prices <\/span>for the third consecutive month<\/span><\/a>. Simultaneously, HDB<\/a> rental prices are experiencing a drop for the first time since 2021.\u00a0<\/span><\/p>\r\n\r\n\r\n\r\n

Let’s jump into the details to understand the dynamics shaping this shift in our housing market.<\/span><\/p>\r\n\r\n\r\n\r\n

\"Condo<\/a><\/figure>\r\n\r\n\r\n\r\n

Condo rental market<\/b><\/h2>\r\n\r\n\r\n\r\n

In October 2023, condo rents experienced a marginal decrease of 0.2% from September 2023. Regional disparities are notable, with RCR (Rest of Central Region) rents inching up by 0.8%, while CCR (Core Central Region) and OCR (Outside Central Region) rents faced a slight downturn by 0.3% and 0.9%, respectively.<\/span><\/p>\r\n\r\n\r\n\r\n

Year-on-year data reveals an overall increase of 10.8% in rents from October 2022. Additionally, distinct upticks are observed in CCR (8.2%), RCR (12.1%), and OCR (12.2%).<\/span><\/p>\r\n\r\n\r\n\r\n

Despite this, rental volumes took a hit, decreasing by 5.4% month-on-month. The count stands at 5,402 units rented in October 2023, down from 5,713 units in September 2023.\u00a0<\/span><\/p>\r\n\r\n\r\n\r\n

On another note, year-on-year rental volumes increased by 0.6%. However, this figure remains 11.4% lower than the 5-year average for October. When examining regions, OCR contributed 34.8%, RCR 34.3%, and CCR 30.9% to the total rental volumes in October 2023.<\/span><\/p>\r\n\r\n\r\n\r\n

Read also:<\/strong> Condo resale market dynamics in October 2023 (Flash report cover)<\/a><\/p>\r\n\r\n\r\n\r\n

This table combines the information regarding changes in rent, year-on-year rent increases, and regional contribution percentages:<\/span><\/p>\r\n\r\n\r\n\r\n

\r\n\r\n\r\n\r\n\r\n\r\n\r\n
Region<\/b><\/td>\r\nMonth-on-month rental price change (%)<\/b><\/td>\r\nYear-on-year rental price change (%)<\/b><\/td>\r\nYear-on-year rental volume change (%)<\/b><\/td>\r\n<\/tr>\r\n
CCR<\/span><\/td>\r\n-0.3<\/span><\/td>\r\n8.2<\/span><\/td>\r\n30.9<\/span><\/td>\r\n<\/tr>\r\n
RCR<\/span><\/td>\r\n+0.8<\/span><\/td>\r\n12.1<\/span><\/td>\r\n34.3<\/span><\/td>\r\n<\/tr>\r\n
OCR<\/span><\/td>\r\n-0.9<\/span><\/td>\r\n12.2<\/span><\/td>\r\n34.8<\/span><\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n<\/figure>\r\n\r\n\r\n\r\n
\"HDB<\/a><\/figure>\r\n\r\n\r\n\r\n

HDB rental market<\/b><\/h2>\r\n\r\n\r\n\r\n

In the HDB rental landscape, October 2023 witnessed a 0.4% decline in rents from September 2023. Mature Estates experienced a slight dip of 0.1%, while Non-Mature Estates saw a modest increase of 0.1%.<\/span><\/p>\r\n\r\n\r\n\r\n

Year-on-year data, on the other hand, tells a different story, showcasing an overall increase of 14.1% in rents from October 2022. The surge is further broken down into 12.7% for Mature Estates and a more substantial 15.4% for Non-Mature Estates.<\/span><\/p>\r\n\r\n\r\n\r\n

\r\n\r\n\r\n\r\n\r\n\r\n\r\n
Metric<\/b><\/td>\r\nMonth-on-month change in rent prices (%)<\/b><\/td>\r\nYear-on-year change in rent prices (%)<\/b><\/td>\r\n<\/tr>\r\n
Overall<\/span><\/td>\r\n-0.4<\/span><\/td>\r\n+14.1<\/span><\/td>\r\n<\/tr>\r\n
Mature Estates<\/span><\/td>\r\n-0.1<\/span><\/td>\r\n+12.7<\/span><\/td>\r\n<\/tr>\r\n
Non-Mature Estates<\/span><\/td>\r\n+0.1<\/span><\/td>\r\n+15.4<\/span><\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\n<\/figure>\r\n\r\n\r\n\r\n

Analysing room types, 3 Room and 5 Room rents decreased by 0.6% and 1.4%, while 4 Room and Executive rents increased by 0.1% and 0.9%, respectively.<\/span><\/p>\r\n\r\n\r\n\r\n

Contrary to the condo market, HDB rental volumes experienced a 2.4% uptick month-on-month, with an estimated 2,830 units rented in October 2023 compared to 2,763 units in September 2023.\u00a0<\/span><\/p>\r\n\r\n\r\n\r\n

Year-on-year, rental volumes increased by 14.9%, surpassing the 5-year average volume for October by 1.7%. The breakdown by room type indicates that 31.9% of total volumes are from 3 Room, 37.7% from 4 Room, 24.5% from 5 Room, and 5.9% from Executive units.<\/span><\/p>\r\n\r\n\r\n\r\n

\"Factors<\/a>\r\n
Image credit: Artist’s impression of Riverfront Residences<\/figcaption>\r\n<\/figure>\r\n\r\n\r\n\r\n

Factors influencing this trend<\/b><\/h2>\r\n\r\n\r\n\r\n

Several factors contribute to this shift in our rental landscape:<\/span><\/p>\r\n\r\n\r\n\r\n

Pandemic-induced changes<\/b><\/h3>\r\n\r\n\r\n\r\n

Firstly, pandemic-induced rental demand pressures have eased.<\/span> According to Mr. Luqman Hakim, Chief Data & Analytics Officer, <\/span>the reopening of land borders has diminished the need for temporary rentals, particularly for workers from Malaysia who constitute a significant portion of Singapore’s workforce.\u00a0<\/span><\/p>\r\n\r\n\r\n\r\n

Spillover from new launch absence<\/b><\/h3>\r\n\r\n\r\n\r\n

Mr. Luqman also shared that the absence of recent new property launches has had a spillover effect, impacting the rental market negatively.\u00a0<\/span><\/p>\r\n\r\n\r\n\r\n

Traditionally, homeowners would sell their properties before new launches to avoid higher ABSD charges and reside in rental homes until the new launches are ready.\u00a0<\/span><\/p>\r\n\r\n\r\n\r\n

The scarcity of new launches has disrupted this pattern, affecting the rental market and contributing to a rise in vacancy rates, the highest observed in five years.<\/span><\/p>\r\n