The local luxury rental market was a strong performer last year, with rents for landed homes rising by 28.1 per cent over the year, with a total of 5,552 units for rent.
Of these, the Dalvey Estate and Fourth Avenue areas each had the most expensive GCBs at $150,000 per month.
This means that a tenant would be paying $1.8 million a year in rent alone, which is enough to buy a quality three-bedroom flat.
A prime townhouse in Queen Astrid Park was leased to a wealthy Chinese national for $200,000 per month ($2.4 million per year). However, this lease is not reflected in the Urban Renewal Authority's figures.
In 2021 there will be just 18 houses with rents above $50,000, but this will more than double to over 40 in 2022.
The local luxury market has expanded to include multinational executives and affluent foreigners seeking permanent residency or citizenship in Singapore, such as high net worth individuals from China and Europe. They are willing to pay high prices to rent quality townhouses, mainly to experience the unique lifestyle of such luxury properties.
In addition to luxury property owners, some real estate companies such as CDL, Far East Organization and Ascott have also entered the luxury rental market, offering a number of high-end flats and houses for rental purposes.
For example, City Developments' local residential rental business offers over 300 luxury units with a current occupancy rate of nearly 100%, with rents starting at $80,000 for a prime townhouse and $12,500 for a three-bedroom high-end private home.
The Far East Organization currently has 1,600 private residential units for rent with an occupancy rate of over 90%, a quarter of which are rented for over $8,000. Villas Holland has premium townhomes renting for $60,000.
From 2020 to 2022, the percentage of individual rentals increases from 78% to 83%, with a corresponding decrease in corporate rentals over the same period. The company has seen an increase in luxury tenants over the past two years, mainly from China, India and the United States.
In particular, the proportion of Chinese tenants has increased from 10 per cent to 18 per cent.
Professionals say that the re-opening of China will drive the luxury rental market and that property companies with large units available for rent will continue to benefit from this increased demand.
At the same time, this period is attracting not only luxury tenants from China, but also multinational companies who want to send more executives to Singapore, so one can further expect the demand for luxury leasing to continue to increase and rents to rise further.
