The average monthly rent for expats in Singapore has risen for the first time in five years, said ECA recently when releasing findings of its latest research.
The average monthly rental price for an unfurnished, mid-market, three-bedroom apartment in areas commonly inhabited by international executives in Singapore is now US$4,233, a rise of 1.4% from last year, according to the firm.
The last 12 months have seen increases in overseas relocation to Singapore, especially in the fintech and pharmaceutical sectors” said Lee Quane, regional director – Asia at ECA International.
“There was also evidence that expatriate populations were moving from Hong Kong to the relative stability of Singapore, thus increasing the demand for housing, although tighter restrictions on work permits for overseas workers have now counteracted this somewhat,” he noted.
“It’s important to note that the rise in the average rent in Singapore remains relatively low at less than 2% from last year, and Singapore is still only the ninth most expensive location in Asia for overall rental costs, behind cities such as Shanghai, Mumbai and Seoul,” Quane pointed out.
Asia Highlights: Hong Kong, China, and Taiwan
Elsewhere, Hong Kong has been named the most expensive location in the world for expat accommodation, for the third year in a row, according to ECA, adding that the average monthly rent in Hong Kong increased 3.45% to US$ 11,318.
Despite another increase in rental costs for expatriates living in Hong Kong, the rise was lower than the 4.9% rise seen the year before, Quane said.
Hong Kong has the most expensive rents due to a number of factors such as the high population density of the territory and limited opportunities to build new homes, which combine to drive rental costs upwards, he added.
Quane expect the number of expats in Hong Kong to drop significantly in 2020 in light of the social unrest last year and the current coronavirus outbreak, predicting that the usually high demand for housing will be tempered.
Cities in China saw varying rental trends over the past year.
Although the capital city Beijing was fairly static, staying in 19th place globally, other Chinese cities saw big increases in the average rent, with Shenzhen seeing the biggest increase of 7.22%, according to ECA.
“The Greater Bay Area Economic Zone continues to go from strength to strength. Rents in the region have followed suit for a number of years, perhaps most significantly in Shenzhen, where rental costs have been increasing by 7-10% per year since 2013,” Quane observed.
Future years may lead to more stability in the rental market though, with the local government making efforts to increase the availability of land for new property construction, he added.
Taipei, the capital of Taiwan, was another city which saw steep increases in rent from last year with a rise of 5.29% — moving the city into the top 50 most expensive locations in the world for expat accommodation.
“The rent increases seen in Taipei are down to two main factors,” Quane said. “Firstly, expatriate numbers increased in the city due to the award of government contracts for a major offshore wind power project. Secondly, after years of unsustainable rises to property sales prices in Taipei, competition for rentals has increased as many local nationals continue to rent in anticipation of future drops in the housing market.”