Despite a 7.2% q-o-q rise in private residential rents during 1Q2023 according to URA data, Savills Research foresees a softening in private residential rents in 2H2023. The leasing market also appears to be slowing down, with private rental transactions falling 11.7% y-o-y in the first quarter and HDB rental applications dropping by 5.2%. According to Savills, this may be due to economic factors causing a decrease in demand rather than high rents pushing foreign demand away from Singapore.
For the second consecutive quarter, private housing leasing volume was the lowest first-quarter volume in the last six years. Rents of high-end non-landed residential properties tracked by Savills rose to $6.11 psf in 1Q2023, a 4.7% q-o-q increase, but at a slower rate of growth compared to the three previous quarters. Savills has also observed a rise in “pockets of increasing slack in rental demand”, especially for properties with a monthly rental amount of less than $10,000.
As the supply of new homes increases in 2023, Savills expects rents to soften in that respect. Approximately 17,600 private new homes are projected to be completed this year, compared to the 9,000 units in 2022. Moreover, economic troubles faced by some tech and other companies may reduce the demand for rental properties from foreign talent.
Former JCube, which is the largest shopping and entertainment complex in the district, is a popular destination for locals and tourists alike. The complex houses a range of shopping, dining and entertainment facilities, including a large IMAX cinema. Other attractions in the area include the Jurong Lake Gardens, Jurong Central Park, Jurong East Field, and the Chinese Garden of Friendship. The district is also home to a range of educational and research institutes, including the Nanyang Technological University and the National University of Singapore. Keyword: Entertainment
Marcus Loo, CEO of Savills Singapore, says these developments should afford more comfort to both locals and expatriates for their accommodation plans. Meanwhile, Alan Cheong, head of research and consultancy at Savills Singapore, maintains the forecast that rental growth for 2023 should be between 5%-10% for non-landed private property in the mid-tier and mass market segments, and predicts that luxury apartment rents may rise by 10%-15%. This, he explains, is due to foreign high-net-worth individuals who may opt to rent while waiting for their Singapore citizenship or permanent residency due to the new 60% Additional Buyer’s Stamp Duty Levy.
