Condo rentals rising more slowly

[mr funny]

http://www.todayonline.com/Business/EDC101106-0000055/Condo-rentals-rising-more-slowly

Condo rentals rising more slowly

by Jo-ann Huang

05:55 AM Nov 06, 2010


SINGAPORE - Rents for non-landed properties such as condominiums are rising at a slower pace. Latest data from the Urban Redevelopment Authority (URA) showed such rentals rose just 3.6 per cent in the third quarter, compared to 6 per cent in the preceding quarter and 4.8 per cent in the first quarter.

Property analysts said the downward trend indicates that the market has reached a sustainable level and the growth is in tandem with the capital values of property, which have seen slower rates of increase as well.

"If capital values are going up but rentals don't increase, this might mean there's an asset bubble," said Mr Donald Han, managing director of Cushman and Wakefield.

Property prices have stabilised due to the recent cooling measures by the Government. Still, a robust economy that is expected to bring in more foreign workers will likely buoy the rental property market, analysts said.

Already demand for rental properties has been growing. Mr Colin Tan, head of research and consultancy at Chesterton Suntec International, said the number of rental contracts increased 5 per cent per month for the first nine months of this year.

Yet the increase in what landlords can expect is slowing - and this could be due in part to the bigger supply of housing offered by owners who had bought the units mainly for investment purposes.

"The proportion of owner-occupier purchases has come down significantly, so the supply of rental units is actually greater. When supply is higher relative to demand, rentals decline or show a slower pace of increase," he said.

For the next year, analysts expect rentals to continue to rise steadily at about 2 to 3 per cent quarterly.

"The bulk of supply that we are seeing in mass and mid-end markets will be completed in 2013. That will be 22,000 units coming on board. The market may soften then but rental recovery will be strong for the next 24 months," said Mr Han.

[mcmlxxvi]

Yeah man! Rental cheong ahhhhhhhh!!!

[Lord Anus]

Yeah man! Rental cheong ahhhhhhhh!!!

it depends on which side your bread's buttered.

high rentals turn off foreign MNC investment and presence in singapore.

as it is, the SGD already very high compared to USD and Euro.

[mcmlxxvi]

it depends on which side your bread's buttered.

high rentals turn off foreign MNC investment and presence in singapore.

as it is, the SGD already very high compared to USD and Euro.

U got a point brudder. Anyway 10% rise the whole of next year i happy liao.

[proud owner]

U got a point brudder. Anyway 10% rise the whole of next year i happy liao.


seriously i dun understand

is rental really rising ?

Ardmore II 10.5k can get , maybe even neg (super negative return )

Waterfall Gardens was 10k ... now 8.5-9.5k

you can argue these 'high end ' owners dont care about rental income ..

but i really dont see rental picking up or have picked up ..maybe i am not well informed ...

can someone who has REALLY rented out his unit HIGHER clarify ?

[mcmlxxvi]

seriously i dun understand

is rental really rising ?

Ardmore II 10.5k can get , maybe even neg (super negative return )

Waterfall Gardens was 10k ... now 8.5-9.5k

you can argue these 'high end ' owners dont care about rental income ..

but i really dont see rental picking up or have picked up ..maybe i am not well informed ...

can someone who has REALLY rented out his unit HIGHER clarify ?

I thought prime still has some space to go? Like 12% or something... before hitting past peak. Guess the rental rise etc is for the other segments RCR OCR and not CCR.

[patricia]

seriously i dun understand

is rental really rising ?

Ardmore II 10.5k can get , maybe even neg (super negative return )

Waterfall Gardens was 10k ... now 8.5-9.5k

you can argue these 'high end ' owners dont care about rental income ..

but i really dont see rental picking up or have picked up ..maybe i am not well informed ...

can someone who has REALLY rented out his unit HIGHER clarify ?U have certain agenda ?

[teddybear]

You are looking at the wrong places. What you quoted are some of the super lousy rental yield estates which didn't go up. Admore area is 1 such locality where prices can be transacted high high but rental yield are damn low low locations.
By the way, my rental is going up. So this proved that rentals are indeed going up. :(


seriously i dun understand

is rental really rising ?

Ardmore II 10.5k can get , maybe even neg (super negative return )

Waterfall Gardens was 10k ... now 8.5-9.5k

you can argue these 'high end ' owners dont care about rental income ..

but i really dont see rental picking up or have picked up ..maybe i am not well informed ...

can someone who has REALLY rented out his unit HIGHER clarify ?

[mantrix]

as long as going up i happy liao :D

[mcmlxxvi]

You are looking at the wrong places. What you quoted are some of the super lousy rental yield estates which didn't go up. Admore area is 1 such locality where prices can be transacted high high but rental yield are damn low low locations.
By the way, my rental is going up. So this proved that rentals are indeed going up. :(

Agreed. Smaller projects, or boutique ones may experience more of such rise. For example an ex-colleague just rented 1 bedder in Clearwater for 2k. Can you imagine? 2k for a 2 yr lease. This probably because he loves nature and greenery and watersports and the east.

[Localite]

Rental values are very good.

I tell you I have been a landlord for many years. This is the golden era of High Yield / Low interest. Finally landlords make some decent money.

FYI I am used to 4% interest and 1.5% rental yield in late 90's.

Now it is the exact opposite.

Given the recovery in the US economy is a jobless recovery i cannot see the interest rates being raised anytime soon.

So enjoy while you can Landlords!

[kane]

that's why areas like Ardmore are either for self-stay or those with low loan to value or paid in full, and hence they must have the holding power. If they relied on the rental to cover their instalment, they'll be toast sooner or later.

it's like buying a illiquid blue chip stock with 2% dividend.

[teddybear]

1.5% rental yield? Not so bad right? Lousy location (=> lousy rental) + buy at super high price may be? Rental yields generally fluctuate between 2-6% in Singapore, but in the past, interest rate always much more 2%! As such, this is really landlord paradise now! Borrow at 1% and rent out at >2% (earn money by just taking money out from bank and buy a property, sit there and collect net profit money from then on)!


Rental values are very good.

I tell you I have been a landlord for many years. This is the golden era of High Yield / Low interest. Finally landlords make some decent money.

FYI I am used to 4% interest and 1.5% rental yield in late 90's.

Now it is the exact opposite.

Given the recovery in the US economy is a jobless recovery i cannot see the interest rates being raised anytime soon.

So enjoy while you can Landlords!

[proud owner]

U have certain agenda ?

no i dun

dont think too much ...

i am just curious when i read reports that rental is RISING SLOWLY

but yet info i get from my friend in spore doing rental ..shows otherwise ..

when i check up some rental units online .. and yes comfirmed those i mentioned are indeed coming off ..a little ..

so that puzzles me ...reality vs newspaper report

perhaps you should question if the article report has an agenda instead ..

[devilplate]

no i dun

dont think too much ...

i am just curious when i read reports that rental is RISING SLOWLY

but yet info i get from my friend in spore doing rental ..shows otherwise ..

when i check up some rental units online .. and yes comfirmed those i mentioned are indeed coming off ..a little ..

so that puzzles me ...reality vs newspaper report

perhaps you should question if the article report has an agenda instead ..

i tot u oredi noe? big units suffer poor rental yield? tats y i said, y pay so much for BIG space and let ur tenant enjoy with such a low yield?:p

landed ppty ard 2% rental yield too...mabe better to rent landed den to buy now?:D

[proud owner]

i tot u oredi noe? big units suffer poor rental yield? tats y i said, y pay so much for BIG space and let ur tenant enjoy with such a low yield?:p

landed ppty ard 2% rental yield too...mabe better to rent landed den to buy now?:D

yes you did ...

just that the report did not mention that prime condos rental are NOT RISING ..

so again ...its a one sided report ... sigh .. why cant our papers be more impartial ?

sure have agenda ..SPH also build condo ...

[kane]

some places creeping up, some places overshoot now creeping down.

[devilplate]

yes you did ...

just that the report did not mention that prime condos rental are NOT RISING ..

so again ...its a one sided report ... sigh .. why cant our papers be more impartial ?

sure have agenda ..SPH also build condo ...

i tink the data is based on overall rental market for non-landed lah...

i actually dun see anything wrong...rentals for most condos r indeed rising wat....u pick those super big units and high psf ones....of coz low lah...lol

4xxsqft city fringe and FH can fetch 5% based on current prices somemore

[bargain hunter]

and so i continue to wonder what will happen to the big CCR units sold at the deadly combination of high sq ft * high psf in 2007 which are going to TOP in 2011 and 2012.




i tink the data is based on overall rental market for non-landed lah...

i actually dun see anything wrong...rentals for most condos r indeed rising wat....u pick those super big units and high psf ones....of coz low lah...lol

4xxsqft city fringe and FH can fetch 5% based on current prices somemore

[proud owner]

and so i continue to wonder what will happen to the big CCR units sold at the deadly combination of high sq ft * high psf in 2007 which are going to TOP in 2011 and 2012.


i know people here said ..these are rich people .,.. either paid full cash or little loan ... etc

but havent we heard also in this very forum ..people who took huge loan like 3 over mio to buy a 10 mio usd project ?

i am sure that are many who made some money in 2006/07 and used the money to punt even bigger units ..etc ..

and yes you are right .. what will happen will these projects TOP soon ? and the rental cannot cover the mortgage ?

[mantrix]

That's why I stick to my philosophy of buying high sq ft and low psf :)

[bargain hunter]

while teddy may not agree with me, i still think there is a 2 tier market within CCR. there are those units which do not need to be rented out. these are those where the rich pple paid in full etc. but there are also those specuvestors of 2007 who will need rental to cover. at least we will know the answer sooner for CCR in 2011.


i know people here said ..these are rich people .,.. either paid full cash or little loan ... etc

but havent we heard also in this very forum ..people who took huge loan like 3 over mio to buy a 10 mio usd project ?

i am sure that are many who made some money in 2006/07 and used the money to punt even bigger units ..etc ..

and yes you are right .. what will happen will these projects TOP soon ? and the rental cannot cover the mortgage ?

[teddybear]

These are just a handful, who cares? The Govt also don't care for these handful. They only cares when the majority 80% are saddled with huge debts and taking 90% LTV loan etc. :D


i know people here said ..these are rich people .,.. either paid full cash or little loan ... etc

but havent we heard also in this very forum ..people who took huge loan like 3 over mio to buy a 10 mio usd project ?

i am sure that are many who made some money in 2006/07 and used the money to punt even bigger units ..etc ..

and yes you are right .. what will happen will these projects TOP soon ? and the rental cannot cover the mortgage ?

[rattydrama]

That's why I stick to my philosophy of buying high sq ft and low psf :)

Max, this is really an interesting concept to me. Well, its worth giving a thought thou.

Just to check have this concept fail you before?

[kingkong1984]

Its all wrong...

small is better...

it is getting smaller...

HDB 3 room selling higher psf than HDB 4 room

HDB 4 room selling higher psf than HDB 5 room

HDB 5 room selling higher psf than HDB executive..

[teddybear]

Those are for HDBs lah.
For private properties, different situations:
- Last time 1100 sqft is really about 1050 sqft usable space. Last time 1100 sqft private property is now sold as 1400 sqft private property (but only with 1050 sqft usable space)!


Its all wrong...

small is better...

it is getting smaller...

HDB 3 room selling higher psf than HDB 4 room

HDB 4 room selling higher psf than HDB 5 room

HDB 5 room selling higher psf than HDB executive..

[mantrix]

Max, this is really an interesting concept to me. Well, its worth giving a thought thou.

Just to check have this concept fail you before?

Thanks for my new name! :)

It has never failed me before (touch wood) - but then again, how can it possibly go wrong? I buy min 3 BR and above. When you buy high sq ft and low psf, you attract rental tenants and owner-occupiers who need the space. Investors all stay away.

Since investers all stay away, and I go in with an investor mindset, there is not really anyone to compete with me. Hence not hard to get choice units, and even easier to rent them out. I'll rent them for 6 mths to a year, while simultaneously marketing them for sale in blocks of 4 weeks, like before CNY (when people starts looking for a new home and just got their bonuses) or after school exams.

My target crowd is very different - mostly are coming to view for genuine home stay, some of them increasing family union while upgrading (means both parents and children sell their hdbs and move into bigger condo)

Just following Warren Buffet's advice :p

[McKinnon]

we have the same strategy! :D

i was sick of chasing prices for smaller units, that i switched to bigger ones.

it was so much easier to get premium units in the bigger pond.




Thanks for my new name! :)

It has never failed me before (touch wood) - but then again, how can it possibly go wrong? I buy min 3 BR and above. When you buy high sq ft and low psf, you attract rental tenants and owner-occupiers who need the space. Investors all stay away.

Since investers all stay away, and I go in with an investor mindset, there is not really anyone to compete with me. Hence not hard to get choice units, and even easier to rent them out. I'll rent them for 6 mths to a year, while simultaneously marketing them for sale in blocks of 4 weeks, like before CNY (when people starts looking for a new home and just got their bonuses) or after school exams.

My target crowd is very different - mostly are coming to view for genuine home stay, some of them increasing family union while upgrading (means both parents and children sell their hdbs and move into bigger condo)

Just following Warren Buffet's advice :p

[mantrix]

we have the same strategy! :D

i was sick of chasing prices for smaller units, that i switched to bigger ones.

it was so much easier to get premium units in the bigger pond.

shhh dun let too many people know else no more fish for us :tongue3:

[DC33_2008]

It is good to have people having different investment strategies. Otherwise too much competition.

[McKinnon]

okok, i keep secret for you if you teach me how to best market my big units. :D



shhh dun let too many people know else no more fish for us :tongue3:

[kingkong1984]

big very easy...

smoke buyers to sell 2 HDB's and stay in one old PENTHOUSE condo.. very easy..

Big is better... everything big... big bigger biggest...

DEBT!

[McKinnon]

hmm, sorry bro ur this post not much credibility.



big very easy...

smoke buyers to sell 2 HDB's and stay in one old PENTHOUSE condo.. very easy..

Big is better... everything big... big bigger biggest...

DEBT!

[kingkong1984]

;)
hmm, sorry bro ur this post not much credibility.;)









.

[mantrix]

okok, i keep secret for you if you teach me how to best market my big units. :D

Can your units sell by themselves? Malays like ground-floors, and there is always a niche for penthouses. Else get multiple agents, go and mark the price up :)

Get a few senior bankers try to get the highest valuation possible, and then sell like 50k below that (owner willing to let go at xxxk amount - below valuation!)

These are well known tricks aren't they? If your agent is smart, he will try to sell to those with big families (in propertyguru phrases like 'ample space for your family members' or 'privacy for everyone' works)

when you display your flat for viewing, try to make it child-proof (cover all sharp edges, measures in place to prevent children falling out etc) and open as many windows as you can to make it airy and improve concentration of negative ions which helps to improve buying sentiment. Use salt crystal lamps / aromatic diffusers to enhance the feel. Some actually turn on the aircon (good for those with west sun - hide the sun using curtains and use air con to raise the luxury quotient) anyway everyone knows this I believe. Remember you are targeting owner occupiers, so you need to make it as cosy as poss. Put family pics on wall and stuff. Much much more so PM me if you want the real juice lah :)

[McKinnon]

wow you the expert! so the main focus for big units is on kids, no wonder the 1st thing potential tenants ask from me are window grills.

[Geylang OKT]

Got window grilles can emphasise on child safety. No window grills can emphasise on asthetic look, i.e. so donch look like you are looking out from a prison.

When marketing properties, black can change into white, white can change into black :D :D :D