All private residential property prices increased in Singapore by 29.7% year-over-year in 2022, the highest rate since 2007, according to data from the rental index maintained by the Urban Redevelopment Authority of Singapore.
Even though they’ve chosen to continue calling Singapore their second home, expats in the country face high rents.
According to several inhabitants, if rents keep on growing consistently, more residents will bite the bullet and purchase a property before paying higher prices for rent.
Foreign occupants in Singapore keep on feeling the squeeze as home rental costs take off and give not many indications of getting back to pre-pandemic levels soon.
Long-term expatriates living in Singapore are spending a lot of money and making drastic changes to cope with rising rents, whether they are renting a room, an apartment, or a house.
The overheated real estate market, according to some foreigners who live here, may be exploited by their landlords to raise rents by as much as doubling them.
According to researchers from Asia-Pacific, despite the fact that the rate of rent increases appears to be slowing down, landlords can still anticipate double-digit price increases.
“If rents continue to grow steadily, more people will just bite the bullet and purchase a property before paying higher prices for rent,” says one researcher.
Even if rents were to correct, it could be mild and not likely to retrace in any significant manner the rise that had taken place since 2021. But some industry experts say prices might ease in the latter part of the year.
“Relief is expected to come only from the second half of 2023 when the slowing economy and the fallout in the tech sector starts to work its way through the demand side of the rental market,” said Alan Cheong, executive director of research and consultancy at Savills Singapore.
An Indonesian expat who lives in Singapore with her family, will see her rent end this month. Her landlord asked for double the amount at the beginning of the year to extend her lease.
According to the 34-year-old, her landlord initially requested a rent increase of 60%, but later increased it to 100%.
Francesca said, “Every time we negotiate, he raises the price… We were really pissed off because it was just not fair.” She added that there were brand-new apartments a street away with better facilities that cost less than what her landlord had requested.
Due to a number of factors, including significant rent increases and the high cost of living, some expats have considered leaving Singapore.
Experts cited a number of factors, including the lingering effects of the pandemic, that have contributed to the skyrocketing rents.
During the pandemic, when foreigners moved to the city-state to evade strict Chinese and Hong Kong regulations, the city-state gained a reputation as a “safe haven.”
During the pandemic, in addition to the rise in demand, a labor shortage in the construction industry exacerbated inventory issues in the housing market and contributed to delays.
“On the supply side, the shortage of rental housing units was caused by delays in new construction caused by the pandemic.