Will headcount increase be enough to reverse the rental market slowdown?

In Q2 2024, condo rents were unchanged, while HDB rents rose marginally.

Employers may play a crucial role in reversing the slowdown in the rental market.

In Q2 2024, there was no month-on-month change in condo rents, whilst HDB rents only rose by a marginal 0.5%.

OrangeTee pointed out that the rental market slowdown is driven by reduced domestic and foreign demand, with expats leaving Singapore due to layoffs or inflation and locals moving into their newly purchased homes.

"Some expats may also consider the rents to be less competitive than those in some other first-tier cities," OrangeTee said.

Huttons, however, noted that despite caution, employers plan to increase headcount in the second half, providing rental market support.

Whilst a headcount increase may offer support, Huttons expect condo rents to bottom in H2 2024 and the HDB rental market to grow at a modest 3%-5% in 2024 amidst tenants' resistance.

"With firmer demand from tenants absorbing some of the vacant units, this led to a stabilisation in rents in Jun 2024. The condo rental market may be close to bottoming out," Huttons added.

Moderation of rents, however, may push more ex-pats to return to Singapore, according to OrangeTee.