The rental rates of residential properties increased sharply during the Covid-19 pandemic as the new housing supply dropped as the construction industry faced severe supply chain disruption. For example, the Covid-19 virus spread like wildfire in the foreign worker dormitories, which disrupted the construction labour supply.
The rapid rise in residential rentals caused great inconveniences and even financial hardship for tenants. However, as the construction industry recovers in 2023, leading to a jump in the supply of new housing units, residential rental rates are coming under pressure.
Our research results on the residential rental market
Based on our research, the private residential property median rental rates started to decline in the last quarter of 2023 and the rentals of non-landed properties, such as condominiums and apartments, were leading the way.
The median rentals of non-landed homes dropped 0.8% quarter-on-quarter (qoq) to $5.12 psf per month in 4Q 2023. Over the same period, the median monthly rental of landed homes slipped by a smaller 0.3% qoq to $3.41 psf as shown in Table 1.
Table 1: Median quarterly rental rates of residential properties
Median rental rates ($psf per month)
Landed home rental
Landed housing rent %qoq
Non-landed home rental
Non-landed rent %qoq
Source: Mogul.sg Research, URA
Table 2: Median quarterly rental volume of residential properties
Number of rental transactions
Landed rental volume
Landed rental vol %qoq
Non-landed rental volume
Non-landed rental vol %qoq
Source: Mogul.sg Research, URA
Furthermore, the number of rental transactions also slipped for both types of private housing in the fourth quarter of last year. (Please see Table 2)
A total of 1,065 landed homes were leased in 4Q 2023, which is a 30.6% drop over the previous quarter. At the same time, the number of non-landed homes rented in the last quarter of 2023 also decreased by 19.1% qoq to 17,712 transactions.
Based on our research results, the sharper decline in the number of landed homes for lease in 4Q 2023 meant that there were fewer landed housing units available in the rental market, compared to the number of non-landed units. As a result, the decline in the rental rates of landed homes were slower than that of non-landed ones in 4Q 2023 as tenants who wanted to rent landed homes have fewer choices and the competition among tenants slowed down the decline in the rental rates of private landed housing.
Our research shows that the decline in the rental rates of private housing in Singapore has already started in 4Q 2023. From mid-2020 to mid-2023, after rising 56% in the 3-year period due to the rental housing supply-demand imbalance caused by the pandemic, private residential rental rates have ample space for correction this year.
As the supply and demand dynamics in the rental housing market continue to normalize in 2024, the rental rates of private residential properties could decrease by 10% to 15% in the coming 12 months, which would bring the housing rentals to the levels seen in 2022. Many tenants would welcome this news.