Condo rents up 0.8% in July

CCR led the price hike on monthly and yearly basis, boosted by supply and demand factors.

Condo rents rose 0.8% MoM in July from June, as all three regions saw its rents up, according to a SRX Media Flash Report.

Core Central Region (CCR), Rest of Central Region (RCR) and Outside Central Region’s (OCR) condo rents edged up 1.1%, 0.3% and 1%, respectively.

On a year-on-year basis, rents climbed 2.7%. It was led by CCR rents which grew 4.7% YoY, followed by OCR at 2.1% YoY, whilst RCR rents rose 1.6% YoY. However, SRX noted that monthly figures were 16.9% down from its peak in January 2013.

“Rents in CCR rose the most on a MoM and YoY basis when compared to the other market segments. The increase could be due to both supply and demand factors, “ Christine Sun, head of research & consultancy at Orange Tee & Tie, commented.

She also noted that the stock of completed luxury homes was down as some developments have been demolished to make way for newer projects. There were also more professionals and corporate executives entering the market lately who prefer to rent a luxury home in the prime districts.

Condo volumes were up 13% MoM to 5,408 units from 4,785 units in June, which is 18.2% higher than its 5-year average volume. In contrast, these volumes dipped 0.9% on a YoY basis.

“Based on our observation, the current tenant mix seems to be from Malaysia, Europe, Australia, and some East Asian countries like Taiwan, South Korea, and China. Rental demand is expected to remain robust as the third quarter usually sees more expats signing or renewing contracts before the year-end holidays,” Sun added.

Meanwhile, HDB rents remained flat from June but rose 1% YoY. It also went down 14.5% from its peak in August 2013.

Rents of three-room and executive rents both inched up 1% and 2.5%, respectively. Four-room and five-room rents fell 0.9% and 0.5%.

Non-mature estates rents climbed 0.4% MoM whilst mature estates rents slipped by 0.4% MoM.

“Overall rents may continue to hold steady or slip marginally in the coming months on the back of the increasing supply of HDB flats reaching their five-year occupation period and being eligible for rent,” Sun said.

HDB volumes were up 4.9% MoM to 1,962 flats in July from 1,870 units in June. On a yearly basis, rental volumes dipped 2.7% from July 2018 but it was 6.1% higher than the 5-year average volume.