Tanjong Pagar Plaza 5-room HDB flat rented out at record high S$7,600

SINGAPORE: Two HDB flats situated in Tanjong Pagar Plaza and Old Airport Road have been rented out for over S$7,000 (approximately US$5,286) each, setting a new record for monthly rental prices among HDB flats in Singapore.

Records from the Housing Development Board (HDB) revealed that a five-room flat located in Block 2 Tanjong Pagar Plaza achieved a rental price of $7,600 last month.

The previous notable rental transaction occurred in September when a five-room unit at 11 Pine Close near Old Airport Road was leased for S$7,400 per month.

This recent rental achievement in Tanjong Pagar Plaza sets a new pinnacle for HDB monthly rental rates in Singapore, as reported by Chinese media outlet Shin Min Daily News on Thursday (22 Dec).

Block 2 Tanjong Pagar Plaza comprises 200 units, including 10 five-room flats.

Constructed in 1976, the block, according to EdgeProp, exhibits indicative resale prices ranging between S$450,000 and S$510,000 for 3-room flats.

Concurrently, the rental rates for 3-room flats within this block typically span between S$2,400 and S$4,000, as per the market assessment.

The location is conveniently situated a mere four-minute walk from Tanjong Pagar MRT Station, boasting proximity to amenities such as three supermarkets and three shopping malls.

According to a resident interviewed by Shin Min Daily News, the 1,300 sq ft flat in question is a combination of two adjacent three-room flats, featuring four rooms, two living rooms, two kitchens, and two toilets.

Christine Sun, senior vice-president of research and analytics at OrangeTee & Tie, remarked to the media that this high rental rate for the Tanjong Pagar unit is a rare exception.

She attributed this rarity to the spaciousness of the unit and its central location, speculating that the tenants likely consist of multiple individuals working in the vicinity.

Furthermore, it was noted that Tanjong Pagar has a limited number of HDB flats available, often leading many tenants to opt for nearby accommodations at Pinnacle＠Duxton.

The median rental rate for a five-room unit there stands around S$5,200, reinforcing the uniqueness of the recent high rental rate in Tanjong Pagar Plaza.

MND Minister earlier dismissed call to regulate market rental fees proposed by Workers’ Party MP

According to a market report released by online property portal PropertyGuru on 16 Nov, rental demand, measured by the volume of inquiries across all rental listings on its portal, decreased by 10.4% quarter on quarter in Q3.

Conversely, the overall rental supply, gauged by the number of listings on PropertyGuru’s platform, increased by 11.3% in the same period.

Despite this data, both residents and expatriates have been expressing growing concerns about the mounting affordability challenges within Singapore’s rental market.

The Business Times even described that 2023 would be “another year of pain for tenants” as higher property taxes and interest rates are likely to contribute to more increases in rents.

In March, Singaporeans were astonished when a five-room HDB flat in Ang Mo Kio set a rental rate record of S$6500, sparking a sensation among netizens.

Merely three months later, another breakthrough took place in Choa Chu Kang, surpassing the previous record by S$100. This achievement stands as a notable highlight of the year 2023.

The Choa Chu Kang flat’s remarkable rental value is not an isolated incident, as another executive unit at Block 110 Tampines Street 11 has come strikingly close to breaking records, achieving an impressive S$6,550 in monthly rent — a mere S$50 away from setting a new benchmark.

In a parliamentary session held in July, MND minister Desmond Lee dismissed the proposal by Workers’ Party Member of Parliament Jamus Lim to regulate market rental fees.

Minister Lee contended that the implementation of rent controls could inadvertently diminish the availability of rentals, potentially leading to an imbalance where rental housing demand surpasses supply, thus giving rise to challenges in allocation and equity.

According to Minister Lee, the rental rates for open market HDB rental flats and private residential properties in Singapore are determined through private agreements between flat owners and tenants.

He emphasized that international experience has demonstrated that while rent controls may temporarily moderate rental increases for some tenants, they are likely to distort the housing market.

HDB and URA introduce temporary eased occupancy caps for larger HDB flats and private homes to ease rental pressure

Despite the Minister’s reluctance to intervene in regulating market rental fees, the HDB and Urban Redevelopment Authority (URA) responded to the surge in rental demand.

On Wednesday (20 Dec), they announced the temporary relaxation of occupancy restrictions for larger HDB flats and private residential properties.

Starting from Jan 22, 2024, until Dec 31, 2026, the occupancy cap for larger public flats and private homes will be raised to allow up to eight unrelated individuals to reside together.

This marks an increase from the current limit of six unrelated individuals, as defined by those not belonging to the same family unit.

HDB and URA highlighted the government’s efforts in augmenting the supply of both public and private housing. They emphasized the collaborative efforts with the construction industry to tackle challenges on the supply side.

This year alone, close to 40,000 homes are anticipated to be completed across the public and private residential sectors.

As these units come onstream, Singaporeans who are currently renting while awaiting the completion of their new homes will vacate their rental units,” they said.

“This will alleviate the tightness in the rental market by increasing the available supply of units for rental.”

Furthermore, HDB has substantially increased the availability of flats under the Parenthood Provisional Housing Scheme (PPHS), from 800 units in 2021 to approximately 2,000 units presently.

“We will further double PPHS supply to 4,000 units by 2025,” the agencies said. “This will support eligible Singaporean families who need interim housing while awaiting the completion of their new flats.”