Singapore rent prices are still sky-high. Long-time expats are having to consider drastic changes

Foreign residents in Singapore continue to feel the squeeze as home rental prices soar with little sign of returning to pre-pandemic levels. Whether renting a room, apartment or house, long-time expats are digging deep and making drastic changes to cope.

Singapore's Urban Redevelopment Authority rental index shows private residential rents surged 29.7% year-on-year in 2022 — the sharpest rise since 2007. Some expats say landlords are exploiting the overheated market, in some cases doubling rents outright. Knight Frank's head of Asia-Pacific research, Christine Li, said the pace of increases is starting to slow but landlords can still expect double-digit growth.

"If rents continue to grow steadily, more people will just bite the bullet and purchase a property before paying higher prices for rent," — Christine Li, Head of Asia-Pacific Research, Knight Frank

Savills Singapore's executive director of research and consultancy, Alan Cheong, expects relief only from the second half of 2023, as a slowing economy and tech-sector fallout work through rental demand — though he cautioned any correction is likely to be mild, not a meaningful reversal of the rise since 2021.

How expats are coping

Several long-time expats described the lengths they've gone to. Francesca, an Indonesian expat, saw her landlord's renewal demand rise from an initial 60% increase to a full 100% hike — prompting her to view other apartments nearby, some in poor condition but still expensive, before eventually securing a unit in the same building for 50% more rather than double. She noted some landlords dangle a few months of "rent-free" incentives specifically to justify raising the headline rent, hoping to do the same across their other properties.

Debbie, who has lived in a River Valley condominium for eight years, saw her rent jump from $9,250 to $13,200 in December — a 42% increase. She accepted it partly because her lease allows termination with just three months' notice if the family leaves the country, and she'd considered relocating back to New Zealand as her husband's salary stayed flat against rising costs for their three children in international school. The family ultimately stayed, cutting back on dining out and taxis instead.

Melinda faced a 110% rent hike on her seven-bedroom Bukit Timah house and considered moving back to the US (a neighbour in the same situation relocated to Penang, Malaysia instead). Wanting to keep her children in their current schools, she downsized instead, moving into an apartment on Orchard Road she'd lived in a decade earlier — ironically now cheaper than what she paid back then.

Kristen, a Singapore permanent resident with a household of five, saw her Bukit Timah rent jump from $9,000 to $15,000 a month, losing previously included perks like aircon servicing and pool cleaning. Unable to justify the cost, she and her family bought a private apartment instead, now paying an $11,000 monthly mortgage. As a property agent herself, she said the market has become intensely competitive — properties that once stayed listed for days now disappear within it.

What's driving up prices

Experts point to several compounding factors. Alan Cheong cited a mix of younger Gen Y and Z renters wanting to move out of their parents' homes to work privately, alongside an influx of foreign professionals. Christine Li noted Singapore's pandemic-era reputation as a "safe haven" drew in foreigners escaping stricter measures in China and Hong Kong. On the supply side, pandemic-driven construction delays left rental housing stock unusually tight, further squeezing the market.

Source: CNBC