Singapore property: World’s 5th most expensive to rent

By iProperty.com Singapore – February 25th, 2011

 

 There are only four countries in the world where it is now cheaper to rent a property other than Singapore. (Image courtesy of Singapore Tourism Board)

With property prices on an incremental rise throughout the whole of 2010 and with this trend showing no signs of slowing in 2011, it should come as no surprise to most Singaporeans that the country remains one of the most expensive places to rent a home both in Asia and the world.

The World’s 5th Most Expensive
Ranked 5th in the world, and 3rd in Asia, on the basis of the average price for a two-bedroom rental property, the city-state has officially one of the highest cost of living rates in the world. Only in Tokyo and Hong Kong does it cost more to rent a couple of bedrooms.

Singapore’s ranking is due to a 15 per cent increase in monthly rent to S$3,600 in 2010 for an unfurnished, two bedroom property, according to a report by ECA International, a human resources support company.

Expats Push up Prices
“The rebound in Singapore has been driven by a general recovery in house prices, along with increased demand,” says Lee Quane, regional director, ECA Asia. Referring to foreign employees transferred to Singapore, who make up a large portion of the rental market here, Quane continued, saying: “Assignee numbers are up again in Singapore following falls during the economic downturn. This has placed pressure on rental accommodation, particularly in areas popular with expatriates.”

For foreign companies who are relocating personnel to Singapore, ECA believes that exchange rate fluctuations play an important role when making direct comparisons of residential property for rent. “The strengthening of the Singapore dollar against its American counterpart has contributed to the relative increase in accommodation costs — when Singapore rents are quoted in local currency they have increased at the lower, albeit significant, rate of 9 percent year-on-year,” says Mr Quane.

Asia’s Most Expensive Cities
Want to find out where you might get a bit more bedroom (or less) for your buck? Asia’s top 19 most expensive cities in which to rent are:

1 Tokyo
2 Hong Kong
3 Singapore
4 Seoul
5 Shanghai
6 Hanoi
7 Bangkok
8 Mumbai
9 Jakarta
10 Beijing
11 Ho Chi Minh City
12 Manila
13 Taipei
14 Kuala Lumpur
15 Guangzhou
16 New Delhi
17 Suzhou
18 Shenzhen
19 Karachi

Can Singaporeans Afford to Rent?
The report is focused primarily on expatriates renting in Singapore, but it does also highlight why many young Singaporeans don’t move out from their parent’s homes: they simply can’t afford to.

Regardless of cultural or religious ties that keep young Singaporeans at home -– unlike in many Western countries, where most young people leave home to go to university and then move out on their own accord in their early twenties, or co-habit with their partner before buying a house –- the sheer cost of renting on a graduate’s salary means most unmarried Singaporeans are yet to fly the proverbial nest.

What do you think? Is renting a property just too expensive to justify -– regardless of the relative freedom it might bring you? Are more Singaporeans staying at home for longer than previously, and what does this trend mean?