Singapore’s rental industry will soon go down, expected would be the coming year, 2019 due to the noticeable decreasing number of foreigners or expats getting in the city.
The registered figure for non- Singapore residents dived drastically by 0.1 percent down to 1.64 million around the month of June following a dropped of 1.6 percent previous year, told Singapore Business Review.
Despite the revealed survey of HSBC’s Expat Explorer Survey last October which explained that Singapore is still the best place to live and earn for a living in a span of four years, expatriate housing offers downswing in current years. This then has some domino effect on housing rentals told Savills Singapore.
Alan Cheong, the Senior Director of Savills Singapore said, “If a certain person consider it as conventional idea, then it goes that the demand made by overseas nationals for flats or any housing around Singapore must decreased while the decision makers of the huge multinational companies remained pessimistic on their views. Per market analyst who are hooked with that negative macro picture of private housing residential properties of 9, 100 units which are expected for its completion by 2019, its rental market is set to be soft by the following year.”
Nevertheless, the softening foreign national’s demand might be due to the increasing rental need of the local resident and citizens which includes both the tenants and owners coming from the en bloc sale properties.
The amended ABSD or Additional Buyer’s Stamp Duty enforced last July 06 of previous year has inspired potential buyers to embrace a
‘wait-and-see ‘ strategy to reacquire units and lease the property instead, stressed Cheong.
While being provided with small supply of the newly constructed and completed private units as well as the decreased in number of unoccupied homes, the housing market is foreseen to become a famous landlord’s market.
Singapore witnessed only 1,088 newest housing combined into stocks of fully furnished homes right in Q3, side by side with the island -wide unoccupied or vacancy rate for private units went down as high as 6.8 percent originally from 7.1 percent last quarter.
“A further easing of vacant stock is expected in the near term, supported by limited new completions and the withdrawal of units from collective sales sites done since the second half of 2016,” added Cheong.
This is on top of the lack of suitably-sized stock for homeowners displaced by their own collective sales. These owners have been struggling to find similarly large sized-flats they previously owned as newer developments mainly featured small units.
With this, Savills expects private condo rents to increase by one to three percent by 2019.