Housing Rental Market in Singapore

There are literally thousands of real estate properties in Singapore that are on offer for rental accommodation. There are condos, HBD apartment units, different types of landed properties and the legacy buildings from the past, such as black and whites, bungalows and shophouses.

Rental market trends

Overall, indications are that rental accommodation and prices are poised to continue in its upswing trend.

Rentals by location

The primary areas for rentals by region are City & South West, Balestier/Greyland, Serangoon/Thompson, Orchard/Holland, East Coast, West, Newton/Bukit Timah, Changi/Pasir Ris and the North region.

A total of nearly 65,000 real estate rentals have been listed for all the regions including hotel accommodation.

There are 426 condos on offer for rental accommodation in all regions.

1,038 HBD apartments have also been listed for the Ang Mio Kio Estate alone, not to mention the 25 other estates also offering apartments for rental.

Tenants eligible for rental accommodation

Tenants must be:

    Singapore citizens
    Permanent residents
    Non-citizens who hold the following visas that are valid for at least 6 months
    Employment pass
    S pass
    Work permit holders (construction workers, Malayan nationals only)
    Student pass
    Dependent pass
    Long term social visit pass
    Foreigners who have verified immigration status and possess a valid S pass

Potential earnings

Potential earnings to owners of rental real estate have proven to be a sustainable and lucrative business in Singapore.

Judging from the monthly rental rates in 2012 paid to rental owners, it's obvious that rentals of the HDB 3-4-5 and executive units as well as the condos are the most attractive and owners of these rentals collect substantial income over a 6 months or 3-year period.

However, given that the figures do not take into account how many units and in what fashion owners are renting them out, the figures may well be much higher.

Rental type - - 6 Months - - 3 Years

HDB 4 room - - SG$14,694 - - SG$44,082

HDB 5 room - - SG$13,884 - - SG$41,652

HDB exec. - - SG$12,402 - - SG$37,206

Condo - - SG$16,086 - - SG$48,258

Actual yields

From the above, it is very apparent that investment in the HDBs and Condos result in very substantial ROIs.

Taking a condominium building as an example, we will accept that the above figures are correct and we will assume several things.

    First, that a condo has 200 rooms
    Second, the condominium structure cost SG$50 million to build
    3rd, the average monthly rental rate is SG$20,000 per month from units of different dimensions and qualities
    4th, the condo structure is good for 40 years.
    It would take only 1 year for the investor/owner to realize earnings of S$4 million, SG$20 million in 5 years, SG$40 million in 10 years and only 2.5 years to earn the remaining SG$10 million.
    This represents a sum total of only 12 years to clear the original investment of S$50 million with the remaining 28 years looked upon as a profitable return on investment.

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