SRX 99.co, SRX: HDB leasing increases in December 2023

All HDB room types are experiencing rising rental rates

HDB rents increased by 1 percent. Rental prices for mature estates rose 1.2 per cent, while those of non-mature estates grew by one per cent.

Rents for all types of rooms increased, with the exception of four-room flats.

HDB rental rates increased by 10,1% on average from one year to the next. The rents on mature estates have increased by 10.4% while those on non-mature estates have increased by 10.3%.

Executive flats recorded a rental increase of 14.7% on the previous year.

HDB’s total leasing volume grew 7.4 per cent in December to approximately 2,891 flats, up from 2,693 units.

The number was 12,8% higher than December 2022 but only 0.1 percent lower than the five year average volume of December months.

In terms of leasing volume, the four-room apartment accounted for 36.2%. Three-roomers accounted 34.1 percent, followed by 5-roomers (24%) and executive apartments (5.7%).
Mixed perspectives on the future

While HDB’s rental market is growing, analysts are divided on its future.

HDB rental market which offers affordable housing will still remain resilient and grow by 8 to 10 percent in 2024. Experts predict that rental approvals will be between 37,000-38,001 in 2023. And remain the same between 36,000-38,000 contracts in 2020,” he said.

HDB is expecting to see rents increase up to 8 percent by 2024.

Even though the HDB housing market is tighter with fewer flats available for a minimum of three months, she doesn’t anticipate a rise in rents because affordability is tenants’ top concern.

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HDB’s rental prices should stabilize in 2024. There will be a modest increase of 1 – 3 %.

Expect HDB rents to start falling in the 1st quarter of 2024. HDB flats will have to follow suit as private rental properties are expected decline in 2024.

In December 2018, condominium rental rates fell for the fifth straight month, erasing the gains seen in the early half of 2023. HDB (Housing and Development Board) rental market however continued to see growth in both leases and rents.

Flash data released Thursday (Jan. 18) by SRX and 98.co showed that rental prices for condos decreased 0.5 percent compared to last month. This was due to rental decreases in all regions.

Rents for condos in the Outside Central Region (OCR) and Rest of Central Region (RCR) were higher by 4,4% and 2,6% respectively. Rents outside the Central Region (OCR), and in the Rest of Central Region, (RCR), were up by 4,4% and 2,6% respectively. Core Central Region Rents (CCR), were 0.9 % higher than the previous year.

The decline of private rentals in December was less severe than the one in November. This is likely because new hires beginning work in the New Year have a slightly higher demand.

Rents could be lower in 2024 as interest rates are still high.

The rental rates of residential properties in private hands could fall 10 to 15 percent in the coming year, bringing them back to levels in 2022.

The growth of the condo rental price will moderate to 2 to 5 percent in 2024. This rate is much lower than 29.7 percent in 2020 and 9.9 in 2011.

Estimated 5,644 condo units were leased in March, a 14 percent increase on the previous month.

In the past, we have seen an increase in landlords accepting lower rents as well more leases renewed before the New Year. In January 2024 the demand is likely to continue as tenants renew or sign new leases.

Rents were down by 11.6 percent on an annualized basis. They were 12,6% below the five-year December average. The OCR was responsible for 38.2% of the total leasing volume.


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