Singapore now ranks as the fifth most expensive location in the world for property rental, based on rents for two-bedroom units that are commonly preferred by expats.
It also ranks as the third most expensive in Asia, behind Tokyo and Hong Kong.
The new ranking comes as a result of a 15 percent increase in monthly rents to S$3,600 (US$2,810) in 2010 for two-bedroom apartments, according to a report released by ECA International.
The company, which provides data and solutions to global human resources professionals, said this placed Singapore one spot higher in global ranking and two spot higher in Asia.
“The rebound in Singapore has been driven by general recovery in house prices along with increased demand,” said Lee Quane, Regional Director at ECA Asia. “Assignee numbers are up again in Singapore following falls during the economic downturn. This has placed pressure on rental accommodation, particularly in areas popular with expatriates.”
Tokyo has been ranked as the most expensive location both in Asia and in the world. In Asia, it was followed by Hong Kong, which is seen as Singapore’s key competitor for expats.
“Land in Hong Kong is already expensive due to the lack of space,” said Mr. Quane, adding that high liquidity in the market, a shortage of residential supply and low interest rates have pushed up rents further.
Meanwhile, Mr. Quane noted, “The strengthening of the Singapore dollar against its American counterpart has contributed to the relative increase in accommodation costs – when Singapore rents are quoted in local currency they have increased at the lower, albeit significant, rate of 9 per cent year-on-year.”