HDB Rents Hit New All-Time High: SRX 99.co
In February, HDB flat rents increased by 1 percent from the previous months, reaching an all-time record. Volumes, however, fell by 19.1 percent to 2,448 rented flats, down from 3.027 units in the month of January.Renters looking to escape inflation are driving up HDB housing prices. Condominium rents are still too high.
In light of the Chinese New Year celebrations, which accounted for the majority of the decline in condo and HDB rental volumes in February, he anticipates that volumes will pick up for both markets in the 2nd quarter of 2024.Monthly, HDB rents in matured estates grew by 1.3 per cent. Non-matured estate rents grew by 0.5 per cent.
All room types experienced a rent increase month on month, led by executive suites (2.6%) and 4-roomers (1.5%). Rents in HDB three room units rose by 0.4% and those for five room HDB units rose by 0.3%.
SINGAPORE’s housing market in February of 2024 remained soft, but the Housing and Development Board’s (HDB) rents climbed to an all-time record after dropping the month before.
According to recent estimates by SRX & 99.co released on Tuesday, Mar 19, condominium rental prices have fallen 1 percent since January.
Chief data and analysis officer of 99.co noted condo rents were at their lowest since January 2023. He attributed this downward spiral due to a glut in supply which has been in place for the past year.
The temporary occupancy of many condominiums was granted last year. More new homes were then made available for rent. It is possible that increased competition has led to lower rent prices in some areas.
As the private rents continue to fluctuate, some tenants could switch from HDB apartments to private homes over the next months.
Rents decreased by 1,6% on a monthly basis in the Core Central Region in February of 2024. Rents declined by 0.5% in the Rest of the Central Region and by 0.60% in the Outside Central Region.
Overall, rents decreased by 4 percent year-over-year. CCR rents fell 5.7 percent; RCR rents dropped 3.9 percentage points, and OCR rental prices dropped 2.1 percentage points.
Condo rental volumes also declined, falling by 21% from the month before and 7.7% year-on year. This was a volume that is 11.9 percent below the five-year monthly average. By region, 35.8% per cent total private rental income came from OCR. The condo rental market is experiencing challenges because of the increase in homes for rent and the number of retrenchments.
There are more rental options available to tenants, and some landowners are willing to talk about rental terms compared to a year earlier. HDB housing prices rose 8.4 percent on the previous year. Mature estate rents rose 7.2 per cent, while non-mature estate rentals grew 9.5 per cent.
Rents have increased for all room types on an annual basis. The executive room rents increased 9 percent; the four-room rents rose 8.5 percent; and the five-roomer rooms rents grew 8.1 percent. Three-room unit rents increased 7.8%.
The February rental volume figures show a decline of 8.4% compared to last year and a 6.9% decrease compared to the five-year monthly average.
In terms of room types, 37.3% of the total volumes were from HDB flats that had four rooms and another 31.7% from those with three rooms. Two-room apartment rentals accounted for 25.4% and executive units accounted for 5.7% of total monthly volumes.
It is possible that the lower rental volume in February was due to a greater number of tenants opting for large HDB flats.
As tenants search for affordable housing, and as fewer flats reach the minimum occupation period, the rents for HDB housing may increase up to 8 percent in a year.
It is possible that the limited supply MOP flats will keep HDB rents high for some time, unless the private rental market drops dramatically and becomes a threat to HDB.
