Given the huge effect on most industries since the Circuit Breaker period started, the number of HDB flats and condo rentals has not been spared as could also be seen in its volume during CB’s second month. Though this happened, there is still a chance that rents could be lightened as per most market viewers when SRX property’s portal released historical data and views.
Data shown by SRX would give the interpretation of changes that happened on leasing details of most non-landed private properties. For example, it would be the 2,881 units recorded in May compared to the 2, 853 unit count last April, which means that it goes up to 1 percent.
Rental figures for these private flats in May still show a lower percentage compared to how they performed last year, the same goes that it has 38.8 off with its percentage when the average 5-year rental was computed for the same month.
Looking at how the HDB rental market performed, the average count of private flats leased dropped by 4.2 percent. It specifically counted 1,147 units in May compared to the number of flats noted last April, which is 1,197.
Its rental count dropped to 45.1% if HDB rental volumes are going to be compared to its record last year. In addition, records also showed a 42 % reduction in its average volume for the last 5 years in that same month.
Out of all the leased private flats during the month of May, 4-room flats were counted for 35.3%, 3- room units for 33.5 percent, 5-room units for 25.8%, while the remaining percentage of 5.4 percent will be for executive flats.
These records show a low number of leases are impacted by the results of the Circuit Breaker extension made from April up until May. As per the head of ERA Realty for Research and Consultancy, Mr Nicholas Mak, the extension caused drastic changes with all leads and communication made for HDB flats and private leasing properties.
However, it was also noted by Mr Mak that all transactions were reached into contracts despite the inability of prospective buyers to see the location offered to them, so they could complete leasing.
As per Mr Mak, most tenants are open to leasing possibilities compared to buying properties or even just viewing them through virtual access into their own leasing websites because their contracts are mostly just for a year or two, which is easier to handle in case there is a sudden change of mind.
He quoted one of his statements that he believed that the price of renting an incompatible property will be more tolerable than buying an incompatible one as the client could easily change their unit once they reach the end of their leasing period compared to when they have bought the property which is more likely to be more difficult to escape.
Out of private rental market records, figures for rents dropped in May for about 1.4% compared to April.
Most landlords were securing most of their rentals to get more tenants during this CB period even if they had to change or decrease their rental price from their original rental cost, Mr Mak added.
As they see what may happen in the future, market viewers have observed that the rental industry will get better especially once the restriction in the area is over, though it will not be as easy as before since the economic changes will probably affect its progress.
Though Orange Tee & Tie’s Head of Research and Consultancy, Ms Christine Sun, has advised in one of her statements that rental progress will improve as travel limitations get lifted, slowly the rental industry will surely return to normal as flat viewings become public again.
The rental market may face some concerns due to the recent impact on the economy but all should be backed gradually as restrictions are lifted. But Mr Mak most likely advised that since all restrictions are still in place within the country as of this month, all leasing transaction counts for private rentals will be on the same average in April and May.
Once the restrictions are lifted though, he expects the rental average to increase as there are private tenants who are most likely expecting the restrictions to end, so they can transfer and leave their current home, thus this also means that it would increase the chances of additional renters for private properties.
But there would still be chances for foreign renters to leave their current units, especially for those who have lost their jobs in Singapore, so it is still something to take note of.
In summary, Mr Mak sees a 2 to 4 percent drop in leasing demand for private flats and HDB apartments by 2 to 4 percent.
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