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Thread: Influx of expats fueling Singapore housing boom

  1. #1
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    Default Influx of expats fueling Singapore housing boom

    Influx of expats fueling Singapore housing boom

    AFP, SINGAPORE
    Wednesday, Jul 11, 2007, Page 10

    "The owners are getting greedy. It's really a landlord's market right now." - property agent

    Malaysian financial executive Ron Tan wasted no time in renewing his lease for a three-bedroom apartment in Singapore when his landlord decided to raise the monthly rent by S$300 (US$199).

    "I see no point in haggling. The way the market is right now, I think my landlord is very reasonable," said Tan, who counts himself among the lucky few to escape the pain of a red hot property market.

    Other foreign executives have no such luck as they find themselves hit with rents that have increased by as much as 50 percent, or more, amid a property boom in the city-state.

    At the Bayshore Park condominium, popular with foreigners because of its closeness to the beach, monthly rents for a two-bedroom unit have doubled to US$2,800 from a year ago.

    "The owners are getting greedy. It's really a landlord's market right now," said a property agent who wanted to be identified only as May.

    Singapore is now the eighth most pricey city in Asia in terms of housing costs for expatriates, global human resources firm ECA International said.

    The firm's latest survey of global accommodation costs showed rents for a three-bedroom apartment in residential areas popular with expatriates jumped 15 percent from 2005 to an average US$5,113 a month last year.

    Fueling the rental boom is the huge influx of foreigners into the Southeast Asian state as the government seeks to recruit more skilled professionals to augment its local workforce.

    Foreigners make up 18 percent of Singapore's 4.4 million population. The government is planning for a population of 6.5 million over the next 50 years and experts say the bulk of the additional 2 million people will come from abroad.

    Singapore's robust economy is also a factor behind the current rental spike with more multinational companies (MNCs) relocating staff to the city-state, which serves as their regional headquarters, observers said.

    "Basically, if we look at the causes of this, a lot of it is being driven by demand," said Lee Quane, general manager of ECA International.

    "The economy in Singapore is doing very well. MNCs are expanding their operations and are bringing in more expatriates," he said.

    Global property consultancy Savills expects the rental crunch to worsen with more foreigners expected to arrive as the government seeks to further entrench the city-state's status as a regional business hub.

    "We expect the rental market to continue to perform well. The number of foreigners is expected to increase with the expansion of companies as well as the increasing number of new firms, especially from the financial sector," Savills said.

    Despite the massive rental hikes, recruitment specialists do not expect Singapore to surrender its cost advantage over arch economic rival Hong Kong anytime soon.

    The southern Chinese territory is still the world's most expensive city in which to rent a three-bedroom apartment and living costs are generally regarded as higher than in Singapore.

    "Rentals have also risen in Hong Kong and it is generally accepted to be a city that has a higher cost of living versus Singapore, so the differential still exists," said Mark Ellwood, a director with recruitment firm Robert Walters.

    For foreign executives or companies planning to relocate staff to the region, accommodation cost is not the only factor taken into account, Ellwood said.

    "From our perspective, we are not seeing this as a reason for people to relocate either as individuals or as corporates," he said. "It's a consideration but it isn't the major driving factor and Singapore is very much an attractive city for people to live and work and for organizations to headquarter into."

    Hong Kong's worsening pollution problem has also worked to Singapore's advantage, Ellwood said.

    "What we are experiencing more and more is that many people, particularly with young families, would like to relocate from Hong Kong to Singapore because they perceive Singapore to be a cleaner city and they are concerned about the levels of pollution in Hong Kong especially if they have young children," he said.

  2. #2
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    Default Re: Influx of expats fueling Singapore housing boom

    Wah! So many foreigners are coming.
    I can't buy so many apartments to rent out to them what!
    Tough!

  3. #3
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    Default Re: Influx of expats fueling Singapore housing boom

    Quote Originally Posted by Investor.
    Wah! So many foreigners are coming.
    I can't buy so many apartments to rent out to them what!
    Tough!
    They will compete with you in the purchase of apartment. You better get your cheque ready.

  4. #4
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    Default Re: Influx of expats fueling Singapore housing boom

    Quote Originally Posted by Investor.
    Wah! So many foreigners are coming.
    I can't buy so many apartments to rent out to them what!
    Tough!
    Do you guys notice that many expats chose to buy a condo unit right now???

    Check with your agents, and you will find many 1000-1200psf condo near orchard are being hunted right now. Citylights and Metropolitan are starting to rise fast. Meraprime, Twin regency and the regency are also targeted by expat. Its like any cheaper unit that near the MRT are being snaped up right now.

    The expats are frustrated with the rental price that they decided to purchase a unit.

    The one that near the MRT is the hottest condo right now, especially The Metropolitan and Meraprime. Price for these 2 condos are starting to rise.
    Citylights price also increase significantly.

  5. #5
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    Default Re: Influx of expats fueling Singapore housing boom

    Quote Originally Posted by Unregistered
    Do you guys notice that many expats chose to buy a condo unit right now???

    Check with your agents, and you will find many 1000-1200psf condo near orchard are being hunted right now. Citylights and Metropolitan are starting to rise fast. Meraprime, Twin regency and the regency are also targeted by expat. Its like any cheaper unit that near the MRT are being snaped up right now.

    The expats are frustrated with the rental price that they decided to purchase a unit.

    The one that near the MRT is the hottest condo right now, especially The Metropolitan and Meraprime. Price for these 2 condos are starting to rise.
    Citylights price also increase significantly.
    Actually it is cheaper to rent than buy for prime area properties. For example, to rent Ardmore Park, it is only $15k per month. To buy is to pay $8 mil, which translate to a hefty monthly repayment of at least $30K or so.

    For outskirt areas, it is cheaper to buy than rent.

  6. #6
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    Default Re: Influx of expats fueling Singapore housing boom

    Quote Originally Posted by Madeira
    Actually it is cheaper to rent than buy for prime area properties. For example, to rent Ardmore Park, it is only $15k per month. To buy is to pay $8 mil, which translate to a hefty monthly repayment of at least $30K or so.

    For outskirt areas, it is cheaper to buy than rent.
    Soon the expats will have no choice but to buy condos near MRT in the outskirts.

  7. #7
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    Default Re: Influx of expats fueling Singapore housing boom

    Quote Originally Posted by Unregistered
    Soon the expats will have no choice but to buy condos near MRT in the outskirts.
    What's wrong with that? In fact, many HDB flat in prime location at affordable rent are available too.

  8. #8
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    Default Re: Influx of expats fueling Singapore housing boom

    Quote Originally Posted by durian
    What's wrong with that? In fact, many HDB flat in prime location at affordable rent are available too.
    Would most expats want to stay in HDB? Besides those HDB that are rented out are usually quite run down and that's why rental is cheap.

  9. #9
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    Default Re: Influx of expats fueling Singapore housing boom

    Quote Originally Posted by Unregistered
    Would most expats want to stay in HDB? Besides those HDB that are rented out are usually quite run down and that's why rental is cheap.
    I think right now the expats look for a long-term stay in Singapore. Thats why I believe they will prefer to buy especially the price keep going up.

    They will look at cheaper condos around the fringe of orchard yet quite exclusive like Bukit Timah, Alexandra, novena and east coast. The one that is near the MRT will be their 1st priority.

    Look at this 4 area, it will booms very soon.
    The heat on these areas can be felt now.

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