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Thread: Rents for private apartments, HDB flats down in Feb

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    Default Rents for private apartments, HDB flats down in Feb

    http://www.straitstimes.com/business...ts-down-in-feb

    Rents for private apartments, HDB flats down in Feb

    Mar 10, 2016

    Ann Williams


    Rents for condominiums and private apartments declined 0.7 per cent in February compared to January, while those for HDB flats fell 0.9 per cent over the same period, according to SRX Property's latest flash rental report.

    Private rents have resumed a 11-month decline since February last year - broken by what market experts termed blips of rentals inching up in January and December.

    Year on year, rents last month were down by 5 per cent from February 2015 and 15.2 per cent off their peak in January 2013, the figures released yesterday showed.

    Private rents had eked out modest month-on-month increases of 0.2 per cent in January and 0.4 per cent in December.

    But market experts said this was probably due to renters signing shorter-term leases, which tend to lock in higher rents than longer term leases.

    The number of private leases signed fell 17.5 per cent to an estimated 2,797 units last month from 3,389 in January. But year on year, the rental volume in February was 0.5 per cent higher than the 2,784 units rented in the same month last year.

    Property consultants note though that much of recent rental transactions have been driven by rental renewals rather than new demand.

    ERA Realty key executive officer Eugene Lim warned last month that headwinds remain strong in the rental market, as there will be some 21,906 private residential units to be completed this year - mostly in the suburban areas - more than the 18,971 completed units last year.

    SRX's data yesterday showed that private rents in the city-fringe and suburbs fell by 1.8 per cent and 1.3 per cent respectively last month, while units in the prime central districts rose by 1.3 per cent.

    Turning to the Housing Board market, rents saw their sixth month of decline since August last year, broken by the increase in January.

    February rents overall are down by 3.7 per cent from the previous year and 9.1 per cent lower than their peak in August 2013, SRX data showed.

    HDB three- and five-room and executive flats posted 0.6 per cent, 1.8 per cent and 0.9 per cent declines in rents respectively. Rents for four-room flats inched up by 0.1 per cent.

    Rental volume also fell for HDB flats with an estimated 1,371 units leased in February, a 20.1 per cent fall from 1,715 in January.

    Year on year, rental volume last month was down 11.3 per cent.

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    http://www.businesstimes.com.sg/real...rtments-condos

    HDB rents more resilient than those for apartments, condos

    SRX data shows 3.7% year-on-year drop for HDB units in February, against 5% for non-landed private homes

    By Kalpana Rashiwala

    [email protected]

    @KalpanaBT

    Mar 10, 2016


    RENTALS of both private apartments/condos and Housing & Development Board (HDB) flats fell in February 2016, SRX Property's latest flash estimates showed. However, HDB flat rents have been showing greater resilience compared to those of non-landed private homes, on a longer-term basis.

    Based on the flash estimates for last month, SRX Property's overall rental index for non-landed private homes has eased 5 per cent year on year. This is a bigger fall compared to a 3.7 per cent decline in SRX's overall rental index for HDB flats.

    Non-landed private residential rents have also slipped more from their peak, to the tune of 15.2 per cent since January 2013 - compared to a 9.1 per cent decline in HDB flat rents from their high in August 2013.

    Eugene Lim, key executive officer of ERA Realty Network, suggests that while rents of HDB flats have also been pushed down by the slide in private residential rents arising from the significant step-up in completion of private homes, HDB flats enjoy a stronger base of rental demand from the more budget-conscious tenants.

    Over the years, housing budgets of foreign professionals working in Singapore have shrunk. "This is especially the case for those who come with their family. So instead of renting a three-bedroom condo unit in the suburbs for about S$3,500 a month, the family may occupy a similar-sized HDB flat with three bedrooms in a comparable location with a rental of S$2,500 or less - translating to a S$1,000 saving a month," Mr Lim said.

    SRX Property's data released on Wednesday showed that its overall rental index for non-landed private homes fell 0.7 per cent month on month in February 2016. This followed slight gains of 0.2 per cent in January 2016 and 0.5 per cent in December 2015.

    On a year-on-year basis (February 2016 versus February 2015), rentals in the Core Central Region (CCR) fared better, inching up 0.22 per cent, whereas those in the city-fringe or Rest of Central Region sank 8.4 per cent and those in the suburbs or Outside Central Region also shed 6.9 per cent.

    However, Jacqueline Wong, head of residential leasing and ad-hoc sales at Savills Singapore, told The BusinessTimes that from her experience, rents have fallen over the past year in CCR. For instance, a partially furnished one bedroom apartment with a study on a high floor at One Shenton now fetches a monthly rent of S$5,500, down from S$6,500 a year ago. At the Ardmore Park condo, where all the apartments are four-bedders of 2,885 sq ft, mid-floor units are leasing at S$13,000-S$14,000 a month currently, lower than the S$15,000-S$16,000 a year ago.

    "Based on our client load , the volume of inbound expats into Singapore has come off about 20 per cent between 2013 and 2015," she revealed.

    Ms Wong is not rosy about the outlook. "With the overall slowdown in the global economy, with oil and gas, and banking among the sectors affected, expat inbounds into Singapore as well as rental levels in CCR can be expected to ease further this year."

    SRX's overall rental index for HDB flats slipped 0.9 per cent month on month in February 2016, contrasting with a 0.4 per cent rise in January 2016.

    Year on year, the rental index of four-room HDB flats has decreased 2.6 per cent, a relatively better showing than the falls of 3.6 per cent for three-room flats and 5.8 per cent each for five-room and executive flats.

    Another finding by SRX Property is that HDB flats in non-mature estates have posted a steeper rental decline of 4.6 per cent year on year - compared to a 3.6 per cent drop in mature estates.

    In terms of the volume of rental transactions, SRX Property reported a 17.5 per cent drop in leasing deals for non-landed private homes to an estimated 2,797 units last month from 3,389 units in January 2016. However, the February 2016 leasing volume was a notch or 0.5 per cent higher than the 2,784 units in February 2015.

    Mr Lim of ERA noted that given the falling rents environment, which has persisted for some time, tenants continue to opt for shorter leases of a year.

    "Demand is unlikely to rebound in the short term as the government maintains strict immigration and foreign manpower policies. Hence transaction volumes are expected to remain at similar levels to last year," he added.

    For HDB flats, the volume of leasing transactions shrank 20.1 per cent to an estimated 1,371 HDB flats last month from 1,715 units in the preceding month. Year on year, the drop was 11.3 per cent.

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