In case you hadn’t noticed, rental prices for properties have been shooting through the roof in the last couple of months. Housing rentals have increased by as much as 100 percent in some areas, and commercial rentals are not far behind. Those with signed leases not up for renewal in the next year should thank their lucky stars: Because the rest of us are going broke.
Don’t believe us? Just ask around—anyone who has had to renew their lease since the end of last year is quoting anywhere from a minimum increase of 30 percent and above.
And it’s not just in the private housing. Expats and those who can afford condos are getting stung, but it seems the increase is right across the housing sector, with House Development Board (HDB) property prices increasing too.
We followed two people whose leases are about to expire and are in search of new homes, to find out just how bad it really is.
Case No.1 – Matthew
The Condo Conundrum
Matthew and his wife are expats who have been living in Singapore for three years. Recently their lease came up for renewal and their housing budget increased so they looked at relocating.
Budget: $6,500 per month.
Areas: Orchard, River Valley.
Size: 1,400 sq. ft.
Other Prerequisites: At least three bedrooms, within 10 minutes walk to MRT and/or bus, full facilities, outdoor area or balcony.
Time Spent Looking: About six weeks.
“With the size of our housing budget, we really did not consider there was going to be any issue with finding an apartment to suit our needs. In fact, we were excited about finally being able to move closer to town.
At first we were confused about why the agent was taking us around to places that were around the $8,000-11,000 per month price range. But after a few inspections, we began to see why.
Basically, there was nowhere in the areas we were interested in that was offering an apartment the size we wanted for less than $7,000. If we had been prepared to go a little further away from the MRT stations, for instance, towards Jervois Road, we could have found an older condo. But all the newer ones in the River Valley and Cairnhill areas were very upfront that they would not even begin negotiating below $7,000.
Even the older condos we looked at, just to get an idea of pricing, were not really options. Almost everything around Orchard is enbloc, meaning likely to be torn down again really soon. We didn’t think it was unreasonable of us not to want to live next to a building site, but we were fast being left with little choice.
We always knew that finding a place with an alfresco area was going to be difficult, and that prerequisite combined with the rental increase basically priced us out of the market.
The longer this went on, and the more letters of consent we put in, the more of our prerequisites we were prepared to forego just so we could move. In the end, we realized we could only move to the areas we wanted if we gave up everything else (such as the facilities, space, and number of bedrooms) we wanted, so we stopped looking.
We ended up renewing our current lease in Toa Payoh for $800 more per month. (Our landlord wouldn’t negotiate on that either.)”
Case No.2 – Samantha
The HDB Humdrum
Samantha is a marketing executive who had to move out from a housemate’s place recently as her lease had expired.
Budget: $700-900 per month.
Areas: Tiong Bahru, Little India, Novena, Katong.
Size: Studio or two bedroom HDB.
Other Prerequisites: Near MRT or public buses, and not too rundown.
Time spent looking: Five weeks.
“With my rather limited budget, I knew finding the right place would be tough—but not that tough! As price of rent has shot through the roof over the past six months, I was not surprised to learn that studio HDBs below $700 are being snapped up like hotcakes. Initially, I tried my luck with these, but of course, none came to fruition as I was usually stuck in the office and had little time to view most places.
I was mostly checking the classifieds in the local newspaper—and I couldn’t believe the astronomical prices! $1,000 for a studio in Khatib—are you kidding?! And $750 for a dodgy and decrepit looking unit on the ground floor in Tiong Bahru?
After failing to get anything decent from the classifieds and with only two-and-a-half-weeks to move out, I panicked and started sending out mass emails and sms-es to let friends and working contacts know that I was desperately looking for a place, and that any leads would help. I should have done this earlier (so as not to trouble friends unnecessarily) as I ended up with some pretty good leads. Some friends recommended me good websites, while others knew of friends who were either looking for housemates or knew of friends who were leasing out units, etc.
A couple of places were interesting: A room in Punggol that was relatively affordable at $500, but was simply too far-off; and another private apartment in town that was quite affordable, but alas, was simply way too small.
So in the end, I had to stick to my original plan to find a unit of my own and not just rent a room. Thankfully, I got to take over a two-bedroom unit from a friend of friend’s who just happened to be giving up their unit. Falling slightly over my budget, I reckoned that it would be OK if I leased out the other room to balance off my rent every month. But the unit comes with a catch: It’s only a six month lease for now as I am simply taking over an already existing lease.
Whoever thought house-hunting would be such an utter pain and an expensive ordeal to boot! If it weren’t for personal contacts, I would probably have ended up homeless as nothing that was within my budget was worthwhile in any way!”
What Housing Development Board (HDB) has to say about the housing rental market.
The Market Value
We scoured the property sections of the newpapers and checked out condo and HDB prices to find out the average rental per month for a two-bedroom flat around Singapore. Here’s what we found.
The Best Tenants
We chat to people living in Singapore’s most expensive districts about what they think about the rental they’re paying.
Sara lives in Kingsville on King’s Road and pays $9,300 per month.
So what’s so good about where you live?
“A friendly multi national community with lots of children in the street.
It’s also quiet, off the main road, has easy access to wet market and a variety of grocery stores and taxis. There are restaurants and bars within walking distance.”
But is it worth the rent you pay?
“No. Our rent increased at the end of last year by almost $3,000. The way the property market and agents work causes this spiraling of prices. There appears to be no incentive for even the tenants’ agent to negotiate the price of a property down.
John lives at Grange Residence on Grange Road and pays $11,000 per month.
So what’s so good about where you live?
“Location, location, location. You can’t beat the central location. Plus our building is new with modern facilities and it’s great for children.”
But is it worth the rent you pay?
“You pay for what you get so I guess yes, it’s worth it.”
How do we compare in terms of housing to our regional neighbors?
