With non-public rents harder hit by means of sluggish sector conditions, it can be no longer extra expensive to rent a good suburban rental than a significant public ripped.
Renting a good suburban rental unit rather than five-room Homes Board ripped could have cost an extra $1, 000 this year and the years to come, on average.
Yet, doing so costs just $500 more a month today. This is based on SRX Property data on median monthly rents for HDB flats and non-landed private residential units outside the central region, excluding executive condominiums.
In 2011, median suburban condo rents ranged from $3, 100 to $3, 300 each month. For HDB five-room and executive flats islandwide, the range was $2, 200 to $2, 600.
Suburban condo rents have fallen to about $2, 700 since the second half of last year. But HDB five-room and executive flats were still fetching rents of $2, 200 and $2, 400 respectively at the end of last year.
HDB landlords thus seem to have escaped the brunt of the sluggish property market. But is there a danger that tenants will switch to condos as the price gap closes?
Experts doubt so , pointing out that median rents do not reflect factors such as flat size. On a per square foot basis, the rental gap has not shrunk significantly.
Condo sizes have been shrinking over the years, so tenants today may pay less simply because they rent smaller units, said experts.
Reduced housing allowances for expatriates could be a factor.
The aggregate data could also disguise differences like location. In a down market, tenants usually relocate from a less central location to a more central location.
Landlord Ian Tham, 49, is banking on his one-bedroom condo unit’s location near Dhoby Ghaut MRT station. Nearby condo units still fetch housing costs of $3, 100 to $3, two hundred, he believed.
Yet many potential professional tenants are offering just simply $2, five-hundred for his. “Tenants are actually spoilt pertaining to choice currently. But I’m just not being forced to purchase this away, so I will not likely accept a terrible deal, micron he reported.
The greater private lease market, compared, is required to continue defending downward demand.
Experts reported rental source is required to increase the 2010 season, as considerably more condos are actually completed and HDB upgraders seek to book their residences.
But HDB rents probably continue keeping yourself afloat seeing that the billiards of likely tenants can be larger.
HDB flats like demand out of both Nasiums Pass and Employment Cross (EP) stands, whereas Nasiums Pass stands would probably be unable to afford to rent a muslim, said a great analyst, mentioning two types of foreign staff employment travels.
The lowest monthly paycheck is $2, 200 pertaining to an Nasiums Pass holder, and $3, 300 pertaining to an EP holder.
ERA Realty key executive officer Eugene Lim agreed, noting that HDB rental transactions rose 5. 8 per cent in the first three months of the year, to 11, 239 units. This is also up from the same period last year.
“This shows the attractiveness of HDB flats, ” he concluded.