The Singapore rental market in late 2024 saw significant shifts that reflect broader economic and social dynamics. While private condominium rents showed a stabilising trend with minimal growth, public Housing and Development Board (HDB) rental prices continued their upward trajectory, driven by robust demand and constrained supply. These contrasting trends paint a vivid picture of a market adapting to evolving preferences and challenges.
This article delves into the latest rental market performance for both condominiums and HDB flats, examines the factors shaping these trends, and provides an outlook for 2025.
Private Condominium Rentals: A Stabilising Market
In November 2024, private condominium rents increased marginally by 0.2% month-on-month. This modest uptick, following a year-on-year decline of 1.3%, reflects a market that is stabilising after years of rapid post-pandemic growth. Rental volumes, however, saw a significant 12.3% decline from October, with 5,010 units rented compared to 5,712 units the previous month. This marked a 10.1% drop compared to the five-year average for November.
Regional Breakdown:
These trends underscore a cautious approach among tenants, who are weighing costs and exploring more affordable alternatives in the OCR.
HDB Rentals: Persistent Growth Amid Constraints
HDB rental prices rose by 0.4% in November 2024 compared to the previous month, bringing the year-on-year growth to a robust 4.2%. Despite higher rents, rental volumes fell by 13.8% month-on-month, with 2,155 units rented in November, down from 2,499 in October. Year-on-year, volumes dropped by 20%, further emphasising the supply crunch.
Insights by Flat Type:
Tenants continue to favour mature estates for their established amenities and connectivity. Rents in mature estates grew by 4.6% year-on-year, compared to a 3.5% increase in non-mature estates.
Diverging Tenant Preferences in a Dynamic Market
The contrasting trends in the HDB and private rental markets highlight how affordability, space requirements, and lifestyle needs are reshaping tenant preferences.
HDB Flats: Affordability and Space
HDB flats continue to attract families and budget-conscious tenants, offering larger living spaces at more affordable rates compared to private condominiums. Mature estates remain highly sought after for their superior amenities and connectivity, though the limited supply of flats reaching MOP has intensified competition, driving rents higher.
Private Condominiums: Amenities and Convenience
The stabilisation of condominium rents has boosted their appeal among expatriates and higher-income locals, especially in the CCR and RCR, where premium locations and accessibility remain key draws.
Affordability Challenges Persist
Affordability is a major concern in Singapore’s rental market, as rental rates have outpaced income growth in recent years. Rising HDB rents pose a burden for lower- and middle-income families, while high condominium rents push some tenants toward the already-constrained public housing market.
Key Factors Shaping the Market
Supply Constraints
The HDB market’s limited supply of flats reaching MOP continues to push rents higher, especially in mature estates.
Economic Influences
Economic and policy changes, such as the COMPASS framework for Employment Pass holders, have reduced demand for private rentals, particularly in the CCR.
Tenant Preferences
The growing interest in larger HDB flats, like Executive units, reflects a shift toward affordability and practicality.
2025 Rental Market Outlook
As we step into 2025, the rental market dynamics are expected to evolve further, shaped by ongoing supply constraints, stabilising trends, and economic factors.
Private Condominiums
The stabilisation of condominium rents is likely to continue, particularly in the OCR, where suburban areas offer a balanced demand-supply environment. However, the anticipated reduction in new unit completions—from 10,561 in 2024 to 6,316 in 2025—may place upward pressure on rents as competition for available units intensifies.
HDB Flats
HDB rents are expected to rise moderately in 2025 as the supply crunch eases slightly with more flats reaching MOP. However, Executive flats and units in mature estates will likely remain highly sought after, sustaining upward pressure on prices.
Affordability Challenges
Affordability will remain a key concern, particularly for lower- and middle-income families in the HDB market. Efforts to expand supply and manage demand will be critical in alleviating rental pressures.
In Conclusion
The Singapore rental market in late 2024 highlighted diverging trends: stabilising private condominium rents and rising HDB rental prices. These dynamics underscore the importance of understanding tenant preferences, supply constraints, and affordability challenges.
As 2025 unfolds, the market will likely see further shifts, driven by supply dynamics and economic factors. For tenants, exploring affordable alternatives and negotiating effectively will be crucial, while landlords must stay informed about market trends to optimise rental strategies.
Whether you’re navigating stabilising condominium rents or rising HDB prices, staying informed is key to making confident decisions in Singapore’s evolving rental landscape.
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