Near Zero Rental Growth Expected Year After Condo Rents Dip 17 Y O Y 2024 Savills
: URA Copyright © 2015 The EDGE Communications Pte Ltd. All rights reserved. All data referred to is based on available market reports/research/publications. Although private housing rents experienced a slight rebound of 0.2% in the last quarter of 2024, landlords can anticipate flat growth this year, according to a report by Savills Singapore.The year-end seasonal lull in rental activity, along with a decrease in net new rental demand due to a decline in employment pass holders, largely contribute to the decline in leasing activity. However, despite the decrease in activity, there is still growth in rental demand and rents have stabilized in the private residential market, especially in more affordable suburban areas that offer lifestyle options such as spacious units and proximity to key amenities. Parc Esta, a 1,399-unit development in District 14, recorded the most number of condo leasing deals in the last quarter of 2024, followed by Marina One Residences, The Sail @ Marina Bay, Normanton Park, and D’Leedon. The decline in rental prices in the Outside Central Region (OCR) is likely due to tenants moving to more central neighborhoods with relatively reasonable rents. The average monthly rent for high-end condos also saw a slight increase of 1.7% in the last quarter of 2024, indicating a potential rebound in the luxury rental market. However, landlords can expect challenges in the rental market this year due to companies reducing headcounts and expat hiring, higher property taxes, and increased conservancy charges. The tight supply of large luxury properties may resist “underpriced” rental offers, but the adoption of AI and a reduction in expat tenants could pose future challenges for the rental market in the long run. Additionally, higher property taxes and a potential delay in interest rate falls could further dampen the market. With fewer new completions expected in 2025, landlords may also be deterred from accepting low rental rates.
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