The cause is one of simple supply and demand, with many completed units coming on to the market, especially in the suburbs, said SLP International executive director Nicholas Mak.
Rents for suburban condos fared the worse in May, down 1.5 per cent from April and 6.1 per cent below May last year.
Central region condo rents rose 0.2 per cent in May but were down 5.6 per cent from a year earlier while city fringe rents dipped 0.6 per cent in May but were down 4.5 per cent year on year.
Mr Mak noted that central region and city fringe rents will continue to be supported by a “flight to quality”, as rents weaken and tenants find better- located units for a comparable rent.
The increasing number of private homes to be completed in the coming months will send rents down by up to 7 per cent for the year, said R’ST Research director Ong Kah Seng.
Condos that received temporary occupation permits in the first quarter included the 501-unit Hedges Park Condominium in Flora Drive, Loyang, and Woodhaven in Woodgrove Avenue in Woodlands, which has 298 units and 39 terraced homes.
Archipelago in Bedok Reservoir Road, which has 553 units and 24 houses, the 622-unit The Luxurie in Compassvale Road and the 610-unit River Isles in Edgedale Plains are expected to be completed this year.
Overall HDB rents were down 2.3 per cent in May from the same month a year earlier with some segments faring better than others.
Mature estate rents fell 0.3 per cent from April to May and were down 1.8 per cent year on year.
Rents at non-mature estates rose 0.2 per cent in May but were off 3 per cent from the same month last year.
The HDB rental market has been affected by many mass market condos competing for tenants as well, said ERA Realty key executive officer Eugene Lim. A two-bedroom mass market condo unit used to rent for just over $3,000 a month but can now go for under that, he noted.
“A further slight decline is possible for HDB rents, but I don’t expect a major decline as a support level has already been found,” he said.
Five-room HDB flats are now rented at $2,300 to $2,400 a month. A five-roomer in a non-mature estate could be let at $2,200 to $2,300 while one in a mature estate may go for about $2,500, he noted.
“The difference used to be more. For example, a five-room HDB flat in Clementi could have been rented out at close to $3,000 per month two years ago,” added Mr Lim.
“We’re looking at an across- the-board weakening of HDB rents, starting from last year. This year and going into next year, we’ll see many new mass market condos coming onstream as well. All of them will be fighting for tenants.”