SINGAPORE – In spite of global economic uncertainty and falling expat numbers having reduced average monthly rental prices by S$678, expat management and consultancy firm ECA International has found that the city-state’s rental prices are still amongst Asia’s top 10, though still nowhere near Hong Kong and its exorbitant rent.
The fall in rental prices came as the proportion of expats fell by 0.1% to 1.64 million in June 2018, in view of global economic pessimism. Such pessimism has also contributed to shifting business sentiments.
While experts predict that Singapore’s economy will expand by 2.5%, a gloomy global economic outlook can still deter non-Singaporeans from workng and residing in the island republic. This low demand is what has resulted in falling rental prices.
According to ECA International, Sept 2018 data showed that the average rental price of an unfurnished, mid-market, 3-bedroom apartment in the Lion City’s more popular areas was US$4,215 a month.
This is a drop of 1.3% compared to average prices in 2017.
In ECA’s latest study, Singapore ranked eighth most expensive in Asia and 24th most expensive in the world.
Compared to Hong Kong — another country well-known for land scarcity, Singapore’s rental pricing is peanuts, however.
In Hong Kong, monthly rental prices are shockingly steep at an average of US$10,929. The land-scarce city thus remains the world’s most expensive location for expatriate rent.
ECA International Asia regional director Lee Quane said, “The main driver of increased rent across Hong Kong in 2018 was the limited availability of housing, which has been a long-term issue for the Hong Kong housing market.
“Rent increases are not just limited to central Hong Kong anymore either; rents are expected to rise throughout outlying neighbourhoods in 2019, too, as international firms seek more affordable office spaces and leverage options in cheaper suburbs.”
Rental laws in Singapore
Singapore used to have rental legislation which sought to protect tenants from unscrupulous landlords during the housing shortage of post-war years. It was known as the Rent Control.
The Rent Control was introduced in 1947 to restrict a landlord from increasing the rent or removing the tenant from the rented property without valid reason.
However, this was repealed in 2001 under the Control of Rent (Abolition) Bill 2001.
Impact of higher rent in Hong Kong
The high rental in Hong Kong has resulted in many elderly people becoming homeless and overcrowding in flats.
One example is the story of Nguyen Van Son, who was featured in South China Morning Post in Nov 2018. He had built a makeshift hut — a place where he had slept for the past 15 months — in Hong Kong’s poorest district of Sham Shui Po.
Another similar instance reported by SCMP was that of a young man named Hung (not his real name), a former cybercafe sleeper. His resting area for the past seven years were dim Sham Shui Po internet cafes.
Since Hong Kong has insufficient flats to cater to everyone’s needs, one flat has often got to be shared by many people boxed up in one room, with no moving space.
Furthermore, house sizes shrinked further from April 2018 as skyrocketing prices severely restrained first-time homeowners’ deposit capabilities.
Singaporeans can count themselves blessed that most people have a roof over their heads and are spared such deplorable living conditions.