Subscribe or login to read more


(Enter your email address if you have subscribed previously)

Email Verification


    Edit Email Icon

Enter OTP code from your email.


Didn't receive OTP code?


Private & HDB Rental Markets 2024 Mid-year Review & Market Outlook

PRIVATE & HDB RENTAL Q2 2024
The private rental market has seen a decline in rent prices for the third consecutive quarter, while the HDB rental market has shown signs of strength, achieving record rents in Q2 2024.

PRIVATE RENTAL MARKET 

The private rental market has seen a sustained decline in rental prices. According to the Urban Redevelopment Authority (URA)’s rental index, overall rents decreased for a third consecutive quarter, slipping by 0.8 per cent in Q2 2024 (Chart 1). This extends the previous rental declines of 1.9 per cent in Q1 2024 and 2.1 per cent in Q4 2023.
For the first half of 2024, overall rents dipped by -2.7 per cent, which is in stark contrast to the strong growth in 1H2023 at 10.2 per cent and in 1H2022 at 11.2 per cent.

A higher supply of private properties has weighed down rents, as almost 30,000 homes were completed in 2022 and 2023. A sharp contraction in domestic demand further aggravated the situation, with many locals leaving the leasing market having transitioned into their permanent homes. 

In addition, the departure of some expatriates has made the market challenges even more pronounced, as some multinational corporations, tech firms, start-ups, and financial institutions have been restructuring over the past two years.

Based on URA Realis data, rental volume rose by 1.7 per cent from 19,981 units in Q1 2024 to  20,326 units in Q2 2024 (Chart 2). 




The rental market may be turning a corner as rents have declined slower over the past quarters. Rental demand may pick up as some rents have become more attractive, drawing tenants back to private rentals from public housing. 

Moreover, demand is likely to pick up in the upcoming months, during which the peak rental period usually occurs between May and September. Some tenants may want to secure a place before the semester begins in August, especially for expat families enrolling their children in international schools here. 

Rents may drop by 3 to 5 per cent in 2024, in contrast to the 8.7 per cent increase in 2023 and the 29.7 per cent rise in 2022 (Table 1).
 
Around 76,000 to 80,000 private homes may be leased this year, lower than the 82,268 units in 2023 and the 90,291 units in 2022.


HDB RENTAL MARKET

The HDB rental market, with its unique dynamics, stands apart from the private rental market. Using flash estimates from SRX-99.co, HDB rental prices have risen, reaching a new all-time high in June 2024. 

Despite the upward trend in rental prices, leasing demand for HDB flats has remained relatively stable. This is because HDB flats continue to offer the most affordable units in the market. The HDB public housing data for Q2 2024 shows a slight increase of 1.7 per cent in approved applications to rent out HDB flats, from 9,398 units in Q1 2024 to 9,554 in Q2. For the first half of 2024, there were 18,952 approved applications, a 2.8 per cent drop from the 19,499 units registered over the same period in 2023. 




Moving forward, we anticipate that demand may fall in the second half of the year due to the reduction in rental inventory and year-end lull. The number of flats reaching their minimum occupation period has decreased over the past two years, leading to a decline in available rentals. Demand may also decrease as more tenants shift back to the private market, attracted by the competitive rental rates landlords offer. Rental prices may increase by 2 to 3 per cent this year, significantly slower than the 10.2 per cent growth seen in 2023. Leasing volumes may drop to 36,500-38,000 units from 39,138 units in 2023.









Download PDF