Singapore overtakes New York as city with highest rental growth — report

SINGAPORE: A March 15 (Wednesday) report says that due to strong demand and low supply, Singapore now holds the pole position when it comes to the strongest increase in prime residential rental rates for the final quarter of last year.

Yearly rental rates in Singapore rose by a substantial 28 per cent in Q4 of 2022, up from 23 per cent in the previous quarter, a report by Knight Frank says. In comparison, New York only saw a 19 per cent growth in prime rental rates.

However, rental rates in New York are up by a whopping 48 per cent, since dipping to a low in the fourth quarter of 2020, amid the Covid-19 pandemic.

London (18 per cent) and Toronto (15 per cent) have the third and fourth-highest growth in rental rates respectively, based on a survey of 10 cities.

The report from Knight Frank shows that Hong Kong took the last place on the survey, with a 6.4 per cent increase.

“Singapore’s soaring rents – driven in part by a lack of supply of new housing during the pandemic – have been a source of consternation for residents, sapping household budgets at a time when living costs are surging. New visa rules to attract foreign talent are likely to supplement tenant demand further,” Bloomberg said on Mar 16.

Knight Frank’s Head of Research in Singapore, Mr Leonard Tay, said, “Around 17,000 new private homes are set for completion in 2023 that should provide some relief to accommodation pressures.

However, until such time, it will remain a landlord’s market and rents are likely to rise further.”

In a Bloomberg interview last June, Liu Thai Ker, the man behind Singapore’s Housing Development Board (HDB) and who’s also known as “the architect of modern Singapore” expressed concerns over Singapore’s high property prices.

The average private property now costs about 15 times the median household earnings, which is higher than in New York, London, and San Francisco, Bloomberg noted.

“I do worry that nowadays, public housing prices is really a business venture than actually solving the housing need. I feel that the implication may not be very good for the economic development of Singapore,” Mr Liu said. /TISG

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