Among Prime Districts, The Combined Average Median Rents For 3-bedroom Units In Districts 1 (Boat Quay/marina/raffles Place), 9 (Orchard/river Valley) And 10 (Tanglin/holland/bukit Timah) Fell By 1.6% Quarter-on-quarter
Savills Research shares that overall rents for 1-to-5-bedroom non-landed properties, excluding outliers*, in Q2 have dropped slightly by 0.72% quarter-on-quarter (QoQ). This was an improvement from a 1.8% decline in the first quarter.
3-bedroom rents for Districts 1 (Boat Quay/Marina /Raffles Place), 3 (Alexandra/Commonwealth) and 4 (Harbourfront/Telok Blangah) rose the most QoQ by 2.9%, 1.6% and 1.2% respectively. The average median rents** for 3-bedroom*** units in Districts 5 (Buona Vista/West Coast/Clementi) and 13 (Macpherson/Potong Pasir)remained unchanged QoQ. For 1-to-3- bedroom units, rents for Districts 2 (Chinatown/Tanjong Pagar) and 26 (Mandai/Upper Thomson) declined the most by 6.3% and 5.2% respectively.
Unchanged from Q1, monthly rents for 3-bedroom units in Districts 1, 4 and 9 still top the list at S$8,900, S$8,300 and S$7,500.
As was the case in Q1/2024, rents for 1-to-3-bedroom units in all market segments fell on a QoQ basis. The Core Central Region (CCR) saw rents falling 2% while The Rest of Region (RCR) experienced a rental decline of 0.4%. Outside the Central Region (OCR), rents dropped 1.6%.
On a year-on-year (YoY) basis, rents for 1-to-3- bedroom units have fallen further by 6.2%, compared with 2% last quarter. Similarly, on a YoY basis, the CCR fell by 7.9%, followed by the RCR at -5.3%, and the OCR at -5.5%.
George Tan, Managing Director, Livethere Residential, Savills Singapore says, “We are expecting 9,600 units to be completed this year versus 19,376 new units that were completed last year. Though there is current stock still in the market, rents are stabilising. This is likely due to the stock slowly being absorbed.”
Alan Cheong, Executive Director, Research & Consultancy, Savills Singapore comments, “Although rents are appearing to be pulling out of a dive, it is increasingly the norm that once a tenant vacates, the unit will take a month or two to be let out unless the landlord lowers the rent significantly. By significant, it may mean asking for rents achieved in mid-2022. Less well-maintained units may also find it harder to find tenants because there is no lack of stock from newly completed units. Probably beginning from this time on, as rents in the private residential market fall more, it may draw away tenants from the HDB market.
“However, it may still be better for landlords to remain flexible in lease negotiations during tenancy renewals. This is because higher annual values for property taxes is a bigger cash drain for a unit that remains untenanted. For 2024, we maintain our forecast for rents to fall 5% YoY,” he adds.
