Rents in Singapore narrow the gap with those in pricey Hong Kong

An acute supply crunch and an influx of wealth have pushed up rents, with locals turning to renting homes due to delays. PHOTO: ST FILE

SINGAPORE – Singapore is catching up with Hong Kong’s rental market as prices in the city-state are expected to soar on limited supply, while Hong Kong grapples with dwindling appetite from population outflows.

That is the view of analysts, who say that many factors impacting prices in the two places remain intact. Rents in Singapore could rise another 10 per cent to 15 per cent in 2023, while those in Hong Kong may post only a 5 per cent increase, according to Bloomberg Intelligence estimates. 

Home rents in Hong Kong are predominantly more expensive when compared with those in Singapore. Yet with few signs of a rebound in the former, Singapore could continue to stand out in 2023 even with a slowdown in growth levels from the 30 per cent surge in 2022.  

Rents in Singapore are “much closer to Hong Kong levels now”, said Mr Simon Smith, a senior director at Savills in Hong Kong. Given the limited luxury stock in Singapore to satisfy the demand, “the gap will narrow and there will be very little daylight between the two markets”. 

Analysts are forecasting leasing values in Hong Kong to remain flat in the next few months, after 2022 saw rates in neighbourhoods popular with expatriates tumble. 

Hong Kong has seen a decline in housing demand as expats relocated overseas to avoid the city’s pandemic restrictions. This happened just as geopolitical instability was already testing confidence. Areas popular with expats were among the locations with the steepest fall in rents in the past three years, according to online rental platform

“There is no major positive catalyst for rents in the first half,” said Mr James Fisher, chief operating officer at

However, returning expats and mainland Chinese could lift demand for Hong Kong rental homes later this year, he added.

In Singapore, an acute supply crunch and an influx of wealth have pushed up rents. Locals turned to renting homes due to pandemic-related construction delays, while a months-long wait-out period imposed on owners who wish to sell their private homes and purchase public housing units exacerbated supply shortfalls, said Ms Victoria Garrett, Knight Frank’s head of residential for Asia-Pacific.

“Competitive advantage is always relative, and Singapore’s status as a safe haven has been elevated by stringent Covid-19 measures in mainland China and Hong Kong (last year),” she added.

That said, Hong Kong is still expensive. The median rent for an 800 sq ft apartment in its Wan Chai area costs about US$5,200 (S$6,900) a month, 70 per cent pricier than one in Singapore’s District 9, which includes the Orchard Road area, according to data compiled by Bloomberg News.

A resumption of quarantine-free travel with China and Hong Kong’s gambit to attract foreign talent could prop up the housing market during the second half of this year. The speed of any recovery in Hong Kong rents will hinge on the city’s removal of all the remaining pandemic measures, which have deterred businesses and visitors.

“A lot is predicated on the speed with which the final restriction is lifted; how the border reopening plays out,” said Mr Smith.

“We still have the mask regulation here; we still have these issues we need to overcome before we can truly move on.” BLOOMBERG

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