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Singapore luxury home rents rise in Q1 despite broader market slump: Huttons

SINGAPORE – Rents for large luxury homes in Singapore rose in the first quarter, in contrast to a general decline in the broader market, as demand from high-net-worth foreigners met limited supply, real estate agents said.

Huttons Asia analysis showed that one market segment in particular – four-bedroom private residential units without land – saw a 36.5 per cent increase in demand in the first quarter, compared to the fourth quarter of 2023.

Leasing demand in this segment also increased 19.3 percent year-on-year, Huttons’ report released on May 2 showed.

The increase in demand for high-end four-bedroom units caused rents for such properties to increase 6.5 percent in the first quarter to an average of $17,467 per month, from $16,396 during the fourth quarter of 2023, Huttons said.

The agency’s luxury property basket tracks residential units in the Central Central Region (CCR) valued at $5 million and above, and with a strata area of ​​at least 2,000 square feet.

The increase in both transactions and rents for the largest luxury units contrasts with broader market trends, where rents have been declining since the last quarter of 2023.

Overall, private housing rents fell 1.9 percent in the first quarter, according to the latest Urban Redevelopment Authority data released last week, extending the 2.1 percent decline in the previous quarter.

“The higher demand for four-bedroom units may be due to more high-net-worth foreigners moving to Singapore due to geopolitical tensions,” said Mark Yip, chief executive of Huttons Asia.

“It is probably also due to the limited supply of these types of units,” he added.

Huttons estimated luxury rental volume in the first quarter of 2024 was 569 units, up 3.6 percent from the fourth quarter of 2023, but down 2.6 percent year over year.

Projects such as Seascape, The Orchard Residences and The Residences at W Singapore Sentosa Cove saw higher rental demand in the first quarter, Yip said.

Linda Chern, director of residential services at CBRE, said developments such as Boulevard 88, 15 Holland Hill and Leedon Green could also be seeing increased demand.

“These are new projects, with larger square footage and larger units,” he said.

Eugene Lim, key executive director of ERA Singapore, noted that the private residential rental market is experiencing divergence.