In the dynamic landscape of Singapore’s real estate, the rental market for luxury condominiums experienced a noteworthy surge, registering a 14.5% increase in the 12 months leading up to September. This information, sourced from the real estate authority Knight Frank, highlights the evolving trends in the aftermath of the Covid-19 real estate boom that had initially propelled both rent and home prices to new heights.
Knight Frank’s comprehensive analysis, encompassing 10 global cities, reveals that prime residential rents, defined as the top 5% of the market, demonstrated a year-over-year average increase of 7.9% in the mentioned period. This upward trajectory was notably driven by factors such as limited supply, returning expats post-pandemic and frustrated house hunters.
Specifically, in Singapore, luxury condominium rents exhibited a robust 14.5% growth compared to the previous year. This trend was mirrored in other major global cities, with London witnessing an 11.2% increase and Sydney posting the most substantial gain at 18.3%, attributed to constraints in housing construction.
However, the third quarter of 2023 marked a shift in this pattern, with prime property rents in New York and Singapore experiencing a marginal decline of 1.3% and 1.7%, respectively, according to Knight Frank’s latest findings.
In light of these developments, Knight Frank anticipates a global deceleration in the rate of rent increases in the coming months. Liam Bailey, the global head of research at Knight Frank, emphasized, “There will be a limit when tenant not willing to bid higher for the tenant price despite weak supply..”
As the real estate landscape undergoes these shifts, Knight Frank provides valuable insights into the evolving dynamics of luxury rentals, signifying a potential stabilization in the near future.
