One of the main factors contributing to the decline in rental prices is the increase in supply.

According to statistics from the Urban Redevelopment Authority, private residential leasing volume in Singapore decreased by 9.8% year-on-year in the third quarter of 2023, and the addition of new supply continues to far exceed net demand. The completion of 17,000 new units this year, along with an expected 9,900 new units to be completed next year, will further increase housing supply, leading to stabilized or lower rental prices. This implies that tenants will have more options and may find more suitable prices in a more competitive market environment.

Additionally, external factors have also influenced the rental market. In the face of economic headwinds in Europe and Asia, many multinational companies are focusing on cost control, including providing housing subsidies to foreign employees.

The rising rents in recent years have affected the number of foreign workers in Singapore, reducing rental demand and further pushing rents downward.

Moreover, the global pandemic has had an impact on the economy, causing difficulties for many businesses. Some employees may face pay cuts or unemployment, putting additional pressure on the rental market.

Factors such as economic uncertainty, a weakened labor market, and deteriorating business sentiment have also pressured the rental market. These factors have made many people find the high rents unbearable, sometimes forcing them to seek more affordable housing options.

In this situation, the decline in rents could provide some relief for tenants, allowing them to better adapt to the current economic environment.

For landlords, the decrease in rental prices may pose some challenges. They may need to navigate a more competitive market environment while considering how to maintain stable rental income. This may require a reassessment of their current rental pricing strategies to attract more tenants and remain competitive with their counterparts.