Rent control could lead to a reduction in the number of available units, which could result in demand exceeding supply.

It could also distort property prices and discourage landlords from properly maintaining their rental units, the department said. "That said, we will not rule out any options and will continue to monitor the situation closely and take the necessary measures."

Local rents for private residential and public housing soared about 32 percent and 27 percent year-on-year in March, respectively, but landlords tend to demand higher rents.

Singapore has overtaken the U.S. New York as the world's fastest-growing country for luxury rents.

Singapore property prices fell for the first time in three years in the second quarter, indicating that the market is starting to cool due to the latest property restrictions.