A report by PropertyGuru, an online property portal, found that the asking rents for private residential landlords have fallen since the third quarter of 2023 as rental demand has eased while supply has risen.

The study published in March showed that the asking rents, as shown by listings on PropertyGuru, steadily declined during the last three quarters of 2023. In December, the correction of asking rents that occurred in October and November also led to a drop in transacted rents.

The price growth is a continuation of two years’ significant increases in both the asking and transaction prices. Rents for non-landed homes have grown by 38.8% between Q4 2020 and Q4 2030, according to the Urban Redevelopment Authority rental index.

The median asking rent for PropertyGuru rose 27.3% between January 2022 to December 2023. The median transacted rental, on the other hand, increased by 35.3%.

Rents are down due to a decline in demand for rental properties and an increase in supply over the last one to two year period.

According to PropertyGuru engagement data, a proxy measure of home demand based on visits on the portal and time spent viewing listings , rental demand dropped by 70 percent in December 2023, from its peak in July 2022. The number of listings has increased by 62.9% since January 2023.

It is possible that the landlords who expected tenants to pay more rent in 2023’s second half may have had to wait longer for their property or have leased it at a lower price.

In 2023, the gap between asking rents and actual rents will begin to narrow.

This narrowing of the gap is indicative of a change in the rental market. More landlords are not increasing their asking rents. Renting properties for longer periods of time likely contributed to this trend, which led landlords to adjust expectations in line with the market and tenants’ affordability.

Singapore has not been immune to the trend.

Rental listings in District 9, for example, (Orchard and River Valley), maintained high visitation rates, with strong renter demand and interest, and increased market friction.

This could indicate a market where landlords are able to charge higher rents because of the increased demand.

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In March of this year, the median rent requested by tenants in District 9 in Singapore was S$6,000 per month. The 25th percentile rent was S$4,000 per month, and the 75th centile rent was S$8,800.

Data from 99.co also showed that in January of this year, the average rent for a 2-bedder in The Sail @ Marina Bay was S$6,656. This project is popular among tenants in Core Central Region. The average monthly rent for a two-bedder at The Sail @ Marina Bay, a popular project among tenants in the Core Central Region, was S$6,656 in January this year.

Stirling Residences, a popular project located in the Rest of Central Region, had a rent of S$4,620, down 7.2% from S$4,979 the year before. In the Outside Central Region at Parc Riviera, the average rent for a 2-bedder in January 2024 was S$3,740, down 8.2 percent from the S$4,072 in January 2023.

The rental market is nearing a turning point. It is difficult to predict the exact extent of the correction, however, due to the uncertainty in the market.

According to the flash estimates released on Thursday by SRX & 99.co, condominium rents increased by 0.3 percent in March after seven consecutive months of decline.

Rents have risen dramatically in the last two years, so any rent drop may not be as significant.

Rent corrections are also dependent on the location and attributes of the project.

Rents can be affected by units that are older or have less desirable characteristics or locations. Rents are still high for some projects, especially those in highly desirable locations. For example, the freehold condominium Klimt Cairnhill, located in District 9, is a new project in a very desirable location.

Rents for smaller and three-bedroom units have slowed down. It could be due to increased enquiries or a landlord’s resistance to further reduce rents. The demand for larger bedrooms is still high due to limited supply.