Rents for larger luxury homes up in Ql amid wider market slump

Spike comes as greater demand from high-net-worth foreigners meets limited supply, say agents

Rents for larger luxury homes in Singapore jumped in the first quarter, in contrast to an overall slump in the wider market, as demand from high-net-worth foreigners met with limited supply, real estate agents said.

Analysis by by Huttons Asia showed that one market segment in particular private non-landed residential four-bedroom units saw a 36.5 per cent jump in demand in the first quarter, compared with the fourth quarter of 2023.

Leasing demand in this segment was also 19.3 per cent higher year on year, the Huttons report released on May 2 showed.

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

The agency's basket of luxury properties tracks residential units in the prime core central region (CCR) valued at $5 million and above, and with a strata area of at least 2,000 sq ft.

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

Overall private housing rents fell 1.9 per cent in the first quarter, based on the latest Urban Redevelopment Authority data released last week, extending the 2.1 per cent decline in the previous quarter.

"The stronger demand for fourbedroom units may be due to more high-net-worth foreigners relocating to Singapore because of geopolitical tensions," said Mr Mark Yip, Huttons Asia's chief executive.

"It is (also) probably due to the limited supply of such units," he added.

Huttons estimated the rental volume for luxury homes in the first quarter of 2024 to be 569 units, 3.6 per cent higher than in the fourth quarter of 2023, but 2.6 per cent lower year on year.