The surge in home rents in Singapore appears to be slowing amid a “growing disparity” in expectations, with tenants resisting increases and landlords reluctant to lower prices in the face of rising costs.
According to a report by CNA, property agents in the city state said that they are getting fewer enquiries from potential tenants for Housing Board and condominium rental listings this year.
“The main reason is probably because there are a lot of new condos that have already been completed this year, and some more big ones that are scheduled to be completed in the second half of the year,” said Mr Jack Sheo, a PropNex agent.
“We are seeing a situation where tenants have more choices.”
Flash estimates from property portals SRX and 99.co last week said that condo rents went up by 3.5 percent in February. Year-on-year, condo rents have spiked by 36.2 percent from February 2022, said the report.
But property analysts said increases are likely to taper off this year as the market adapts.
ERA analyst Eugene Lim and OrangeTee & Tie’s Christine Sun both said demand will likely cool over the year as more HDB flats and private condominiums enter the market. Tenants awaiting the completion of their new Build-to-Order (BTO) flats will also drop out of the market when their homes are ready, said Mr Lim, who is ERA’s key executive officer.
He said that for one client, the monthly mortgage has exceeded the current rent, so the landlord is asking for a minimum rent of S$4,300 to cover her costs.
“The last transacted price was S$4,200 but prospective tenants are reluctant to pay that. They are bargaining at the price level of S$4,000. So there is this gap.”
One landlord of a condominium unit in Tanah Merah said he had no choice but to raise his rental rate. The increase, from S$3,200 to S$4,300 a month, was just enough to cover his higher mortgage payments, Mr Wilfred Wong said.
