Condo rental market booms in 2024 as demand soars to new heights

SINGAPORE: The condo rental market is expected to maintain its stability throughout 2024, with a flat growth trajectory likely as demand steadily picks up in response to ongoing economic recovery, according to real estate consultancy Huttons.

Firm rents amidst reduced transactions

According to the Singapore Business Review, while condo rental transactions saw a 7.5% decline in October 2024, the rental rates themselves remained resilient, indicating the market’s strength.

Huttons pointed out that despite fewer transactions, leasing demand in October was still higher than a year ago, showcasing the market’s ongoing vitality.

“Even with more condo completions in the past two months, the easing of interest rates has alleviated some pressure on landlords. As a result, many are holding firm on their asking rents,” Huttons said.

Premium housing gaining ground in the Core Central Region

In a similar vein, OrangeTee has observed a noticeable shift towards luxury and premium housing, particularly in the Core Central Region (CCR).

The demand for such properties is being driven by tenants attracted to high-end amenities, prime locations, and a narrowing cost difference between luxury and other market segments.

October 2024 saw CCR’s market share increase to 32.2%, up from 30.9% in May 2024, underscoring the growing appeal of premium housing as rent gaps between various segments continue to tighten.

“This shift in demand towards higher-end properties signals a robust market for premium rentals, as more tenants are drawn to the lifestyle and benefits offered by prime locations,” an expert from OrangeTee noted.

In a report from the Business Times, Wong Shanting, ERA Singapore’s head of research and market intelligence, stated that the slight increase in condo rents in October is probably a temporary market rebound, rather than a departure from the ongoing trend of price stability.

Looking ahead – a steady market

As the economic recovery progresses and interest rates stabilize, the outlook for the condo rental market remains optimistic. Although growth may be flat, the continued demand for both standard and premium condos indicates a market that is well-positioned for sustained stability through the remainder of 2024.