Leasing volumes down, rents up for private residential homes in Q1: Savills

Leasing volumes were down by 5.1% whilst rents grew by 4.2%.

Private residential leasing volumes decreased whilst rents were up at a faster pace in the first quarter (Q1) of 2022, property expert, Savills, said in its latest report.

Savills research said the leasing volume for private residential properties contracted 5.1% quarter-on-quarter (QoQ) to 22,699 in Q1 2022 but its decline was smaller than the 11.9% recorded in the previous quarter.

On a yearly basis, Savills also noted that the number of rental transactions decreased by 3.9%.

The Urban Redevelopment Authority rental index increased for a sixth consecutive quarter, rising by 4.2% QoQ in Q1 2022. This was on the back of tight residential supply, low number of completed properties, and strong demand for homes.

“This was the largest QoQ increase since the second quarter of 2010 when rents rose by 5.9%. Rents of landed properties rose by a larger 5.3%, compared to the 4.1% for non-landed properties,” said Savills.

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As for monthly rents for high-end non-landed private residential projects, it grew by 3.6% QoQ to $4.45 per square foot in Q1 2022. Stronger demand for luxurious properties was due to relaxed travel restrictions.

Savills sees that as vacancies remain below 6% and continue to decrease, the government may expect private residential rents to rise strongly.