Good News - Trend seen in Condo rents going down!!!

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taikoo
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Good News - Trend seen in Condo rents going down!!!

Post by taikoo » Thu, 03 Jan 2008 1:36 pm

I want to share with you a recent experience of my friend.

They live in/around Orchard/Rivervalley area. For the past 2 years they were paying $3,800 for their aparment. When they went to renew their landlord quoted $ 8,800. After seeing the recent downward trends in the rentals, the landlord ultimately accepted renwal @ $5,800!

So those of you who are on the verge of renewal, can now hope for lesser rentals, given the above example.

Also, all those who have heard of any similar stories, please share here. So that we can know how fast the rental market is going down.

Cheers

Singapore Property Search

 

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Post by ScoobyDoes » Thu, 03 Jan 2008 1:47 pm

Not really sure that's evidence....... just evidence that the landlord might have been trying his luck with the orignal quote.

Let's face it he still managed a very sizeable increase that now looks good in comparison to the initial $8,800. You know the tactic surely, ask for much more than you'll accept and see if they fall for it. You can imagine that a target around $5.5 or 6k was the landlords actual target, that's still a hell of a lot higher than the previous 2-yrs!

I hope it goes that way, don't get me wrong..... but i don't think this one particular story is a sign.
Last edited by ScoobyDoes on Thu, 03 Jan 2008 4:25 pm, edited 1 time in total.

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Alex3
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Post by Alex3 » Thu, 03 Jan 2008 4:00 pm

Certainly useful info for me as an insight into a SG landlords mentality (greed) when negotiating rent. I will be arriving next month and no doubt expect to be the target of this type of "try on". :wink:

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sundaymorningstaple
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Post by sundaymorningstaple » Thu, 03 Jan 2008 4:54 pm

taikoo,

It would seem you are easily swayed. The newspapers all indicate that prices are still rising albeit at a slightly slower pace that last month and they also indicate that they believe the trend will continue to rise for at least the next 6 months. One owner does not a trend make!

Good luck.
SOME PEOPLE TRY TO TURN BACK THEIR ODOMETERS. NOT ME. I WANT PEOPLE TO KNOW WHY I LOOK THIS WAY. I'VE TRAVELED A LONG WAY, AND SOME OF THE ROADS WEREN'T PAVED. ~ Will Rogers

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Post by T+D » Thu, 03 Jan 2008 8:27 pm

Although happy to propogate rumours of crashing rents I think in reality the market has been seasonaly slow in december which has meant that some ridiculous demands have been scaled back to merely outrageous ones.

The example you quote of 3800 going to 5800 is a 52% increase - i think this has been the going rate in the slow month of december and certainly a good target to negotiate crazy demands down to.

The fact remains that there is still a lack of supply of decent places compared to demand, it would be interesting to see if January and February brings more new blood in as expected by the landlords - if it does I see rent increases at this level staying for at least the next few months, if it doesnt I suspect time will erode greed and we will see this rate of increase weaken further.

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Post by phil30k » Fri, 04 Jan 2008 12:43 pm

I have to agree with Sundaymorningstaple.

Singapore landlords believe that companies set budgets for rents which becomes the maximum rent they can get for that unit from your company. They feel that if they charge you a rate below this budget, they have effectively lost money that was there for the taking.

Most will try to push the rent upwards to this perceived budget amount irrespective of what the actual market rate is.

I suppose if you complain repeatedly about how expensive the rent is, come lease renewal time, you'd probably not find the landlord raising rent. Vice Versa, if you keep expressing how happy you are with the place, you'd probably find the rental going up.

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Post by zjules » Fri, 04 Jan 2008 4:40 pm

Still cant understand why people say the demand is greater than the supply... My condo has been half empty the whole last year i have been there. Thats great though, the pool is always quiet :) Its certainly not hard to find a place now, and theres loads of places nearing completion.

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Post by EADG » Fri, 04 Jan 2008 5:38 pm

from some of these responses and from others on different threads, there seems to be an assumption the owners make that people get housing allowances - some do, a lot do not

this thing to do is make this clear to the agents up front and have them communicate this to the owners

not that I expect any real humanitarian support from them, but have heard there are a few good landlords out there

"the landlord ultimately accepted renwal @ $5,800" - sorry, but to me, up from $3,800, this is nothing short of obscene, and says a lot about the characters of such people

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rents falling

Post by morphic » Sat, 05 Jan 2008 8:06 pm

i am also looking to rent again now and have found many units available with all asking prices negotiable.

the feeling is totally different from a year ago when i last looked and is entirely different from the stories i was hearing a few months ago.

in addition, quite a high percentage of the landlords are also trying to sell and this is completely different from my previous experience.

this reminds me of the US and UK where people believed prices would continue to rocket and then one day the mood just changed, like it was switched overnight from bullish to bearish.

it will take time to know if this is a short period of consolidation or a reversal of the trend, but if the trend has reversed it will soon be too late for any owner thats wants to get out at the top or any landlord that wants a half decent rent.

i suppose with the US and UK and European markets in free fall it would make sense that Singapore couldnt remain insulalated forever. this is especially the case when so many MNC's are trying to reduce expenses and paying ever more exhorbitant housing allowances had to stop somwhere or if not then fewer relocations becomes inevitable in the end.

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Post by taikoo » Sat, 05 Jan 2008 8:13 pm

sundaymorningstaple wrote:taikoo,

It would seem you are easily swayed. The newspapers all indicate that prices are still rising albeit at a slightly slower pace that last month and they also indicate that they believe the trend will continue to rise for at least the next 6 months. One owner does not a trend make!

Good luck.
To me it seems you are being easily swayed by the newspaper reports. When you say newspapers, I presume you are referring to The Straits Times. Right?

The reports that the property reporters (especially the ones by Joyce Teo and Fiona Chan - do they think they are still doing apprentice work???) are belting out day in day out in this newspaper are based on the assumptions, presumptions and statistics (really?) of property agencies, who go by and fuel the 'greedy' landlords, which make people like you to get judgmental in calling me that I am getting swayed. May the Good luck be with you.

I am going by what I am hearing. I have already noticed the downward trend in the rental market and am going to be guided by what I hear from the experiences than what 'all newspapers indicate'. And to the best of my ability will report such positive reports here for the benefit of expats like me. (Such reports can also can accelerate the downward trend, which would be good for all of us. Who knows? you see, I am a optimist in this respect)

One point certainly I want to make. Transparency in rental market in Singapore is 'zero'. The property agencies are in cohorts with the landlords and quote fancy rents which can never be corroborated. This is the pathetic situation in this developed nation. For example, in Hong Kong, the property agencies are regulated by an authority and the property agencies are mandatorily required to display the transactions that they concluded and the indicative prices of the upcoming properties. It is upto the consumer to choose.

Atleast do you agree with me on lack of transaparency in rental market???

The remedy for lack of transaparency? to promote a neutral party, could be a website where the transactions can happen directly between the landlords and their tenants,, to reduce the influence of the middlemen (read property agents).

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Re: rents falling

Post by taikoo » Sat, 05 Jan 2008 8:31 pm

morphic wrote:i am also looking to rent again now and have found many units available with all asking prices negotiable.
Morphic,

This is what precisely happened with my friend in my quoted example.

In addition to the available units in the existing condos, I am noticing a number of units, in a rough estimate around 2,000, between rivervalley and CBD area, getting ready and TOP should happen very soon. Added to this, a number of complexes elsewhere e.g., ECP also are getting TOPed soon.

With all these units coming into the market soon, the artificial 'scarcity' that the proeprty agents are lying to us (since there is not transparency in the market!) and helping the greedy landlords, is coming to an end.

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Post by taikoo » Sat, 05 Jan 2008 8:36 pm

zjules wrote:Still cant understand why people say the demand is greater than the supply... My condo has been half empty the whole last year i have been there. Thats great though, the pool is always quiet :) Its certainly not hard to find a place now, and theres loads of places nearing completion.
Exactly, Zjules! the reason, according to me, Lack of transaparency!!! nothing else.

This is what I am trying to explain in my two replies above.

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rents falling

Post by morphic » Sat, 05 Jan 2008 9:04 pm

taikoo...i looked at a river valley area unit today.

in fact, apart from the floor level it was identical to one i saw a year ago. the asking rent was 20% higher than a year ago.

but first that rise seems well below the peak of a few months ago. and secondly, the asking price was negotiable. i would expect to be able to get it at last year's level if i wanted to make an offer.

this tells me that river valley area prices have peaked already. and judging by the vast supply (opposite great world city there is a huge new development nearing TOP and there are many others dotted around) this softening makes perfect sense.

unless there is an influx of new expats with fat housing allowances there wont be the demand to meet this supply. with the world economy slowing down (first the US, UK and Europe and now Singapore) that influx seems unlikely, certainly nothing like the tidal wave of last year and the year before.

and all the displaced tenants of previously en-bloc'ed and demolished projects have already been housed now and new enblocs are slowing down now that the frenzy is over. my guess is rents keep falling.

selling prices could be stickier, it takes time to give up on a dream. if foreign money continues to pour in indiscriminately then who knows, but i somehow doubt the myth of infinite dumb money. even that will stop at the first whiff of a market slowdown.

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Re: Good News - Trend seen in Condo rents going down!!!

Post by sundaymorningstaple » Sat, 05 Jan 2008 11:30 pm

taikoo wrote:I want to share with you a recent experience of my friend.

They live in/around Orchard/Rivervalley area. For the past 2 years they were paying $3,800 for their aparment. When they went to renew their landlord quoted $ 8,800. After seeing the recent downward trends in the rentals, the landlord ultimately accepted renwal @ $5,800!

So those of you who are on the verge of renewal, can now hope for lesser rentals, given the above example.

Also, all those who have heard of any similar stories, please share here. So that we can know how fast the rental market is going down.

Cheers
Transparency. Singapore. Oxymoron. Agreed.

However, looking at your example above a unit going for 3.8 being let at 5.6 is not a downward trend any more than morphic's "infact apart of the floor level" with a 20% increase (Why would he expect to be able to get it at last years level? Bit presumptious I'd say as well. All anybody here has given is anecdotal evidence anyway. I am the first to diss the local papers. But, given the fact that your ideas aren't any more reliable than a real estates agents spiel then it's buyer beware. Again, a 50% increase in rental costs for your friends unit is not a indication that the market is "going down" it is just an indication the increase is slowing down and nothing more. So far, nobody here or anywhere else has indicated that their rentals have, in fact, decreased have they? This only serves to confirm what I said earlier. The rate of increase has slowed down but the trend of increase is still there.
:roll:
SOME PEOPLE TRY TO TURN BACK THEIR ODOMETERS. NOT ME. I WANT PEOPLE TO KNOW WHY I LOOK THIS WAY. I'VE TRAVELED A LONG WAY, AND SOME OF THE ROADS WEREN'T PAVED. ~ Will Rogers

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sundaymorningstaple

Post by morphic » Sun, 06 Jan 2008 12:31 am

well, you can either sense weakness or you can't and i guess you can't. if you need to wait for proof it will be too late. statistical proof is always too late. i sense weakness and i think im right. its all anecdotal for you. you need masses of statistical data to feel confident. but i know that statistics will eventually follow the anecdotes, they have to. anecdotes are instant. statistics takes time and effort to compile so of course it will always be after the fact and much too late to be of any use.

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