HDB rents inched up 1.3% YoY in December

The rents for all room types, except three-room HDB units, all grew.

HDB rents posted a slight increase of 1.3% YoY and 0.1% MoM in December, according to a report by SRX.

Rents for three-room HDB units decreased by 0.3% YoY in December, whilst rents for all other room types grew YoY. Rents for four-room HDB units jumped 2.1% jump in rents, for five-room HDB units 1.3%, and for executive HDB units 1.4%.

Meanwhile, rents for mature estates and non-mature estates inched up YoY by 1.2% and 1.4%, respectively.

HDB rent volumes fell by 5.3% YoY in December. A total of 23,958 HDB rental transactions were recorded in 2019, which was 1.9% higher than in 2018.

Breaking down by room types, 35.9% of total rental volume came from four-room units, 32.7% from three-room units, 25.2% from five-room units and 6.2% from the executive units.

Huttons Asia’s head of research Sze Teck Lee noted that higher volume of rentals in Q4 may have been due to major policy changes in 2019 such as higher income ceiling and enhanced housing grants which boosted the appeal of resale flats.

“The cumulative effect of multiple policies seemed effective in mitigating further price falls arising from the concerns surrounding the lease depreciation of older flats and the increasing supply of flats. A number of important changes were made last year such as allowing buyers greater flexibility in using CPF to buy older flats and enhancing the CPF Housing Grant to increase housing affordability for more Singaporeans,” said Christine Li, head of research at TEE International.

Lee projects HDB resale transactions in 2020 to hit a figure between 23,000 and 24,000. “HDB resale transactions and price growth in 2020 is expected to be between 0 and 2%. With the HDB resale market bottoming out, this is a good opportunity for HDB owners who want to upgrade to a private property,” he added.