3-Bedroom Average Median Rents Declined 3.2% Month-On-Month In May 2023 And Increased 17.8% Year-on-Year

For Immediate Release – Savills May 2023 Rental Guide reports a decline of 3.2% month-on-month (MoM) and an increase of 17.8% year-on-year (YoY) in average median private non-landed unit rentals for the 3-bedroom category¹.

For the month of May, District 4 (Keppel, Mount Faber, Sentosa, Telok Blangah) is the submarket² with the highest median monthly rents at $9,300. District 1 (Boat Quay, Chinatown, Havelock Road, Marina Square, Raffles Place, Suntec City) closely follows at $8,500 with District 9 (Cairnhill, Killiney, Leonie Hill, Orchard, Oxley) at a median monthly rent of $7,500. (Figures are extracted from Urban Redevelopment Authority and are accurate as of extraction date on 15 June 2023).

However, the average median private non-landed property rents for the 1-to-4-bedroom overall declined 2.2% MoM across all districts. In contrast, April 2023 recorded a 2.4% MoM increase.

This weakening in rents was expected, due to 2 factors. First, there is an influx of new supply in 2023, as more projects near completion and construction schedule delays are resolved. Secondly, challenging economic conditions have compelled companies to tighten their budgets, leading to reduced rent expenses for expatriates and layoffs in a bid to manage staffing costs.

Alan Cheong, Executive Director of Savills Research & Consultancy comments: “For renters in Singapore, relief is in the air as rentals in more districts start to soften. For investors, their financial position is still protected as the rental decline remains moderate.”

For landlords, although they may experience a marginal decline in rents, their overall yields remain healthy, allowing them to effectively counterbalance higher interest costs.

Marcus Loo, Chief Executive Officer of Savills Singapore adds, “The period of soaring private home rents appears to be behind us as more units come online and the pandemic disruptions clear. Additionally, economic headwinds are putting a dampener on tenants’ budgets. This rental correction allows the market to reset to a more sustainable foundation for the longer term good of the economy.”

¹The size of 3-bedroom units can vary across market segments, ranging from 900 to >1100 square feet in the mass market and mid-tier market. In luxury district condos, sizes typically range from 1,500 to 2,000 sq ft while super luxury apartments for example in Sentosa, sizes can exceed 3,000 sq ft.

²District 6 (City Hall, High Street, North Bridge Road) recorded a median monthly rental price of $45,000 in May 2023. This figure could be considered an outlier as it represented the sole recorded transaction in District 6 for the month; hence it has been excluded from the calculations, The property is situated at Eden Residences Capitol on Stamford Road.

Note: Data spanning shorter time periods, such as monthly data, tend to exhibit higher levels of volatility compared to data covering longer timeframes.