02 Sep 2024
1H2024 Singapore Rental Market Insights: School Proximity and Pricing Trends
Property Insight

The rental property market in Singapore during the second quarter of 2024 demonstrated notable trends and adjustments. The overall rental index showed a further moderation, with rental prices decreasing by 0.8% in 2Q2024, a smaller decline compared to the 1.9% drop in 1Q2024. This period also marked a stabilization in the market as rental prices in the first half of 2024 adjusted by -2.7%, a significant change from the 10.2% increase observed in the first half of 2023. The moderation can be attributed to the influx of newly completed developments entering the market, adding to the rental supply.

The number of non-landed rental contracts rose by 1.9% quarter-on-quarter, from 18,878 units in 1Q2024 to 19,558 units in 2Q2024. This increase is likely driven by the high volume of private developments completed in 2023, which have now entered the rental segment. The year-on-year growth of non-landed rental contracts in 1H2024 was 2.4%, reflecting continued demand for such properties. It is projected that the total non-landed rental volume for 2024 will fall between 78,000 and 80,000 contracts.

Newly completed developments, particularly those that obtained their Temporary Occupation Permit (TOP) recently, such as Normanton Park, Treasure at Tampines, Parc Clematis, and The M, have shown strong rental demand. Renters seem to favor newer units due to their fresh condition and minimal wear and tear.

Core Central Region (CCR) districts continued to lead in rental popularity, with District 9 securing the highest number of non-landed rental contracts in 1H2024, followed by Districts 10 and 15. These districts remain desirable among renters, underlining their prominence in the rental market.

The HDB rental market also experienced growth, with rental approvals increasing by 1.7% quarter-on-quarter from 9,398 in 1Q2024 to 9,554 in 2Q2024. A significant portion of these approvals (36.9%) were for 4-room flats, which saw the highest number of rental approvals since 3Q2023. Jurong West recorded the highest number of HDB rental transactions in 1H2024, followed by Tampines and Sengkang.

Despite the overall moderation in HDB rentals, the resale market strengthened in 1H2024, with a 6.9% increase in resale transactions compared to 1H2023. This trend indicates a shift towards resale flats among homeowners, partly due to the limited number of flats reaching their Minimum Occupation Period (MOP) in 2024.

School proximity significantly influenced rental growth in areas like Bukit Batok and Hougang, where highly sought-after schools like Princess Elizabeth Primary School and Holy Innocents' Primary School are located. The scarcity of larger flats and the high demand for school enrollment contributed to notable increases in rental prices in these areas.

Overall, the rental market in Singapore is stabilizing, supported by strategic housing initiatives from the government. These initiatives aim to alleviate rental pressures by boosting housing supply and providing targeted support for those in need, ensuring a balanced and accessible rental market for residents.

Click here for the full report  

  

Prepared By: 

Mohan Sandrasegeran 

Head of Research & Data Analytics  

You may also like

Property Insight
04 Dec 2024
2025 Singapore Rental Market: Trends, Insights, and Projections

The Singapore rental market exhibited steady growth in 2024, with total non-landed rental transactions increasing by 5.3% year-on-year. Transactions rose from 65,460 in the first ten months of 2023 to 68,960 in the same period of 2024. 

The Rest of Central Region (RCR) led the charge, with an 8.9% increase in rental transactions, driven by popular developments like Normanton Park, which registered 775 rental transactions due to its strategic location and comprehensive facilities. The Core Central Region (CCR) saw a 6.0% rise, reflecting the ongoing appeal of high-end developments such as The Sail @ Marina Bay, which recorded 449 transactions. Meanwhile, the Outside Central Region (OCR) experienced moderate growth of 1.4%, with Treasure at Tampines leading the segment with 512 transactions, attributed to its affordability and extensive amenities.

Newly completed developments played a central role in reshaping tenant preferences across all market segments. These projects, offering modern amenities and convenient access to key areas, contributed significantly to the increase in rental volumes. For instance, in the RCR, Stirling Residences and City Square Residences attracted tenants due to their central locations and accessibility to MRT stations.

In the HDB market, rental transactions moderated by 5.2% from 32,490 in the first ten months of 2023 to 30,799 in the same period of 2024. This moderation aligned with a robust 10.4% increase in resale volumes, as some homeowners opted to sell their flats amid strong demand in the resale market. Additionally, progress in addressing pandemic-induced construction delays saw the completion of 87 out of 94 delayed projects by August 2024, enabling renters to transition into new flats.

The outlook for 2025 indicates a significant moderation in private residential completions, projected to decline from 9,103 units in 2024 to 5,348 units in 2025, a 41% adjustment. This tightening supply is expected to bolster rental demand and keep rental prices resilient. Non-landed rental volumes are forecast to range between 81,000 and 83,000, while HDB rental volumes are anticipated to stabilize between 38,000 and 39,000, aided by policy changes increasing the occupancy limit for larger flats.

The market dynamics underscore the evolving preferences of tenants and the importance of strategic positioning for stakeholders in the rental market. As supply tightens, both landlords and investors are poised to benefit from sustained demand and stable rental rates.

 Click

here

for the full report   

   

Prepared By: 

Mohan Sandrasegeran 

Head of Research & Data Analytics 

  

  

Email:

mohan@sri.com.sg


  

Property Insight
28 Nov 2024
Navigating Singapore’s HDB Resale Market: Key Insights for 2025

Transformative Developments in 2024

The year 2024 marked significant progress for Singapore’s public housing sector, driven by initiatives promoting market stability and affordability. Key measures included reducing the Loan-to-Value (LTV) limit for HDB loans from 80% to 75% to curb speculative borrowing, while the Enhanced CPF Housing Grant (EHG) was raised to offer greater support for first-time homebuyers, with eligible families now receiving up to $230,000 in grants. These steps aim to ensure affordability and equity in housing.

New BTO Classification Framework

The October 2024 Build-To-Order (BTO) exercise introduced a new classification system:

• Standard Flats (58%): Majority supply, catering to broad public demand.

• Plus Flats (38%): Located in desirable areas, offering enhanced subsidies but subject to stricter resale conditions.

• Prime Flats (4%): Exclusive supply in central areas with tight resale restrictions to ensure affordability.

This framework seeks to balance affordability, choice, and market inclusivity, creating a stratified housing market with distinct resale conditions for each flat type.

Drivers of Million-Dollar Resale Flats

In 2024, newer flats, particularly those completed from 2013 onwards, drove the bulk of the million-dollar HDB transactions. Their popularity stems from modern designs, prime locations near transport and commercial hubs, and longer lease terms. Proximity to amenities, high floors, and well-maintained conditions are additional factors commanding premium prices.

Outlook for HDB Resale Market in 2025

The number of flats reaching their Minimum Occupation Period (MOP) in 2025 is expected to decline by 41.6% to approximately 6,976 units, compared to 11,952 in 2024. The composition includes:

• 4-room flats (38.3%): High demand from families.

• 2-room Flexi flats (27.2%): Popular among singles and seniors.

• 3-Gen flats (1.9%): Sought after by multi-generational families.

Punggol leads as the largest source of MOP-eligible flats, with strong resale potential due to proximity to Northshore Plaza and waterfront living amenities. However, many homeowners may choose not to sell immediately post-MOP, valuing proximity to schools, amenities, and family.

The report highlights the evolving dynamics of the HDB market, emphasizing the government’s role in fostering a sustainable, inclusive, and equitable housing landscape.

Click

here

for the full report 

Prepared By:

Mohan Sandrasegeran

Head of Research & Data Analytics

Email:

mohan@sri.com.sg

 

Property Insight
25 Nov 2024
What to Expect from Singapore’s Private Residential Market in 2025

The private property market in Singapore demonstrated contrasting dynamics in 2024, characterized by a "tale of two halves." The first half of the year experienced muted sales activity, with 1,889 units (excluding ECs) sold. This was attributed to limited new launches and a high-interest rate environment, which dampened buyer confidence. However, the second half of 2024 is estimated doubling of sales, reaching 4,000 to 4,500 units. This was driven by a significant rate cut by the US Federal Reserve, which improved financial conditions and reinvigorated buyer sentiment.

Key large-scale residential developments, such as Chuan Park and Emerald of Katong, were notable performers. These projects demonstrated the strong appeal of strategic locations, effective marketing campaigns, and well-integrated facilities. Together, they set benchmarks for sales momentum, with over 800–900 units each, showcasing developers' confidence in meeting market demand.

The outlook for 2025 appears positive, supported by steady interest rates and a robust pipeline. Anticipated launches such as The Orie, Marina View Residences, and Parktown Residence are expected to sustain buyer interest, reflecting renewed confidence in Singapore's property market. Additionally, the EC segment is poised for a strong year, with three major developments contributing an estimated 2,030 units—the highest number since 2016.

The number of private residential completions is expected to moderate in 2025, from 9,103 units in 2024 to 5,348 units—an adjustment of 41%. This tightening supply is likely to influence property prices and rental demand positively. The constrained supply, coupled with steady demand from HDB upgraders transitioning to private resale properties, is expected to sustain resale activity. Transactions in the resale market are projected to range between 11,000 and 13,000 units.

Overall, the private property market is well-positioned for growth in 2025, with new home sales forecasted at 7,000 to 8,000 units. The favourable combination of economic growth, stable employment, and adaptable buyer sentiment will continue to support the market’s recovery, ensuring robust activity in both new launches and the resale segment.

Click

here

for the full report 

Prepared By:

Mohan Sandrasegeran

Head of Research & Data Analytics

Email:

mohan@sri.com.sg