Private homes leasing volumes rose 12.9% in Q3

CCR showed the strongest leasing growth.

Leasing volumes of private residential properties jumped 12.9% QoQ to 26,998 completed leases in Q3 from 23,921 in Q2, according to a Savills report. This figure is also 4.2% YoY higher from 25,900 in Q3 2018.

Leases in the Core Central Region (CCR) led the growth, accounting for 18.4% of rents.The volumes in Outside Central Region (OCR) rose 11.8% QoQ, whilst leases in the Rest of Central Region (RCR) grew 9.2%.

In terms of lease rates, 62.7% of the rental volume in Q3 came from units leased at a monthly rate of $2,000 to less than $4,000. This was followed by units from $4,000 to less than $6,000 per month, making up 16.6% of the total volume. Savills noted that this composition was similar with 9M 2019, with units from $2,000 to less than $4,000 accounting for 63.5% and those from $4,000 to less than $6,000 comprising 16.7% of the total leasing volume.

Meanwhile, leasing activity is projected to moderate in Q4 due to seasonal factors. Despite this, Savills stated that the full-year tally for leasing transactions of private homes may set a record in 2019 and will continue on to 2020 as companies continue to transfer staff to Singapore.

Rental index of private homes inched up 0.1% in Q3, according to data from the Urban Redevelopment Authority (URA). This showed a slower pace of growth compared to the 1.3% rise recorded in Q2.

This figures was mainly dragged down by rents of landed homes, which fell by 2.3% QoQ. Rental index for condominiums and apartments also grew at a slower rate at 0.4% QoQ.

“Although leasing demand remains healthy, increasing rents and shrinking housing budgets may limit further rental growth,” Savills stated.