Overall Condo Rental Market Demand Softened in 2023 Across Singapore

The condominium rental market experienced a ripple effect from the worldwide economic downturn and geopolitical tensions in 2023, leading to a sustained decline in supply and an increase in rental prices.

There was robust demand in January, with 2,604 rental transactions. However, the overall rental market softened throughout the rest of the year as transaction volume continued on a downward trend. Rental prices across all regions followed a similar pattern. A spike was recorded in the first quarter when it climbed to around $9,000 in May. It gradually declined in the fourth quarter. 

Fewer EP holders in 2023 compared to 2022

The softening of the condo rental market could be due to a couple of factors. More Employment Pass (EP) holders were approved by the Ministry of Manpower (MOM), increasing by 10,000 to 197,300 as of mid-2023. However, this pales in comparison to the 25,600 increase in EP holders in 2022, translating to a slowdown in new tenant demand for the second half of the year. 

The 30% jump in asking rent in 2022 likely nudged EP holders to more affordable rental options such as co-living spaces and HDB flats. Some have also chosen to be digital nomads and instead moved to places such as Johor Bahru, Batam, or even Bali.

More new condo launches have also been completed in 2023, with about 9,000 developments reaching completion in the first nine months of the year. Cumulatively, the supply completions in the first three quarters of 2023 were more than three times that for the same period in 2022.

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Should you rent or lease a condo in 2024?

Despite the moderation in overall condo rental prices, if you’re genuinely looking to rent or lease a home in 2024, you should remain level-headed when it comes to your property transaction. It may be dangerous to gamble on whether we’re at an inflection point. Rather than timing the market, you should seek the advice of a property agent to make your property decision based on your real financial situation. 

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