While private resale condominium prices and sales volume have somewhat found their footing, the same cannot yet be said of the private home rental market.
Private non-landed home rental rates dipped by 0.4% in August. Property experts think the market has yet to reach the bottom of the cycle. While the fall is now slight, the rental market continues to wane. Rental prices last month were 2.5% lower than that of August 2016. The 4,271 units tenanted in August meant rental volume dipped 10.4%, down from 4,766 in July.
HDB flat rents in mature estates also dipped slightly by 0.2%. Newer estates fared better with rents edging up. The rental market has fallen overall, in consonance with falling property prices across the board. HDB rents are now 13.8% lower than its peak in 2013. In August this year, rents fell 3.8%, down from 1,772 in July.
Dip in rental prices not bound by district
Ultimately, it is a matter of demand and supply. Rents fell across all districts with a 3.5%, 2.3% and 2.1% dip in the city centre, city fringe and suburbs respectively. Heated competition in areas with new launches is likely to continue into next year. This may put a further squeeze on rents.
However, analysts expect to rental growth in some areas such as Buona Vista. The area is a hub for research and development companies with an extensive pool of expatriates in the workforce. New services and business sectors are also starting up there. And as most school years begin in last August and September, the rental market may pick up.