Singapore non-landed residential rents drop for third consecutive quarter in Q2

The rental index dipped by 0.8% QoQ.

According to the URA, the rental index for non-landed properties in Singapore continued to decline for a third consecutive quarter in Q2/2024, albeit at a slower rate of 0.8% QoQ. 

Savills said the deceleration in the downward trend is attributed to the resilience of rents in the CCR, which only decreased by 0.1% from the previous quarter. 

Here’s more from Savills:

Rents in the RCR also saw a smaller decline of 1.4% QoQ in Q2, compared to a 1.9% drop in the previous quarter. In these two sub-markets, an increase in leases for smaller units (one- and two-bedders), which command higher rents per sq ft, particularly in newer projects, helped mitigate the overall rental decline. In contrast, rental prices in the OCR fell by 1.3% QoQ in Q2, roughly in line with the 1.4% drop recorded in Q1. 

In Q2/2024, the average monthly rent of high-end non-landed properties in Savills’ basket softened by 1.6% QoQ to S$5.80 per sq ft. This marks the fourth consecutive quarter of decline and represents a cumulative fall of 6.3% from the recent peak of S$6.19 per sq ft that was achieved in Q2/2023. 

Given the competition from numerous newly completed units and the increase of property tax for non-owner occupied residential properties, landlords who have large units in some aging projects have to stay flexible in lease negotiations in order to rent out their units as quickly as possible.