Singapore Expats Forum

Getting hard to find tenants for your property in Singapore?

Discuss about the latest news & interesting topics, real life experience or other out of topic discussions with locals & expatriates in Singapore.

FaeLLe
Chatter
Chatter
Posts: 485
Joined: Wed, 28 Feb 2007
Location: London

Getting hard to find tenants for your property in Singapore?

Postby FaeLLe » Wed, 25 Dec 2013 5:02 am

I think the rental property market is really slowing down in Singapore.

Had my 3 bedroom condo up for rent for almost two months and not got any serious interest for my place.... it is being advertised on Singapore Expats property website.

For a good place (well renovated etc) and 10 minutes from CBD i would have thought I would be seeing people swarming for it..

Anyone else have similar observations?

User avatar
Wd40
Director
Director
Posts: 3788
Joined: Tue, 04 Dec 2012
Location: SIndiapore

Postby Wd40 » Wed, 25 Dec 2013 9:40 am

May be your rental expectations are way above the market? What is your expected rental and which condo is this?

User avatar
JR8
Immortal
Immortal
Posts: 16514
Joined: Wed, 24 Mar 2010
Location: K. Puki Manis

Re: Getting hard to find tenants for your property in Singap

Postby JR8 » Wed, 25 Dec 2013 11:20 am

FaeLLe wrote:I think the rental property market is really slowing down in Singapore.

Had my 3 bedroom condo up for rent for almost two months and not got any serious interest for my place.... it is being advertised on Singapore Expats property website.

For a good place (well renovated etc) and 10 minutes from CBD i would have thought I would be seeing people swarming for it..

Anyone else have similar observations?


IME the worst time to have a tenant leave is the 4th quarter. Any other time, you spruce the place up, hike the asking rent and off you go, but if it's 4th quarter, for me, I tend to get a rather sickening sense of doom. As the quarter progresses fewer and fewer people are relocating, and things don't start moving again until after mid-January.

That is how it works in London. Why not have a look at the URA rental stats and see if it holds true here too?

Also you should be getting feedback from the agent.
- How many viewings is it getting?
- What is the applicant feed-back?
- Why no bites?
- Is the asking rent too high?

Look at comparative units in the same condo, and try and gauge your asking rent vs any others.

Did you get a few rental valuations before instructing an agent? If so how did the other valuations compare? There is a major agent in London called Foxtons. Their negotiators are paid almost solely on commission, so they are very motivated to get a sale by just any means, and very aggressive with it*.

Beware of a marketing technique called 'Get the instruction, get the reduction'.

Example:
You have a place to sell or rent.
Agent A values it at say $475k/$1500pcm
Agent B at $495k/$1600pcm
Agent C at $565k/$1750pcm

Which one are you going to choose?

Sadly many go right for C. Now the agent has got you. He reports it's getting 'lots of interest', and some viewings, but no one is offering [a classic sign of it being overpriced]. Then he says (whilst sucking his teeth) 'You know... if we want to get this one away sooner rather than later, I think we're going to have to drop the price [fake pained look on his face]'. Maybe you grin and bear it and agree to drop it to $525k/1650. Maybe you get a bite, maybe not. Time is money, and it's you that's losing it...

Tip: When you get valuations done, ask the negotiator precisely how they have arrived at their figure. The world over they do it via 'comparatives'. I.e. they compare your unit to ones that have just let or been sold, and then make minor adjustments for:
- Size, aspect, condition, floor, etc.
A useful reply would be something like 'Well we sold/let a unit last month on the Xth floor (or along this street), it had an extra bedroom (or roof terrace, etc) but the condition was not as good as this one, We put that one on at $x and it went for $0.95x after 2-3 weeks'. - Or something like that. If it's a sales instruction, the usual starting point is $psf, and then all the variables re: desirability are tweaked onto that base figure. You can check the stats at URA, so can check if he's bull$hitting you...

Good luck!


* I've had friends working in many agents in London including Foxtons, and I've heard the 'inside track' on how the latter apparently function.

p.s. Remember the landlords maxim 'Voids kill'. It is far better to price reasonably and get a place away, than have a place sit with a void. That applies especially to newer landlords who might have higher financial leverage and outgoings. In such circumstances something like a 3 month void might wipe out a years profit, rendering your landlording 'business' pointless.

User avatar
x9200
Moderator
Moderator
Posts: 9167
Joined: Mon, 07 Sep 2009
Location: Singapore

Re: Getting hard to find tenants for your property in Singap

Postby x9200 » Wed, 25 Dec 2013 11:56 am

JR8 wrote:p.s. Remember the landlords maxim 'Voids kill'. It is far better to price reasonably and get a place away, than have a place sit with a void. That applies especially to newer landlords who might have higher financial leverage and outgoings. In such circumstances something like a 3 month void might wipe out a years profit, rendering your landlording 'business' pointless.

Local LLs are often filthy rich and they rather lose money than rent the place below their desired price/condition. Sometimes it goes beyond any logic and common sense.

When we were looking for renting an apartment mid of this year we found one we liked and the price was ok but what raised red flag was how long the place was being advertised and stayed empty - at least half a year. Soon after the negotiation started it became apparent that the LL is extremely inflexible. At the end we got all what we wanted but the impression we got in the process made us quit at this final stage (already after signing LOI). We just thought the LL looked like troubles. If anything got broken or when we would be vacating it eventually. No, thank you.
We rented another unit in the same condo with no slightest hassle from the LL. He managed to secure us, a new tenant when the old one was still living there.

FaeLLe
Chatter
Chatter
Posts: 485
Joined: Wed, 28 Feb 2007
Location: London

Postby FaeLLe » Wed, 25 Dec 2013 1:20 pm

Wd40 wrote:May be your rental expectations are way above the market? What is your expected rental and which condo is this?


Average rental is the same as what I am asking for as per URA website for District 12. It's around $4500 pm for the 3 bed room square feet I have. Even my agents say my asking price is reasonable.

In fact the pictures show the superior condition of the unit so it should stand out over others in the same condo.

Let's see I have put in 6 months of mortgage repayments in the bank so I might rather let it go un - rented than for a lower price.

User avatar
JR8
Immortal
Immortal
Posts: 16514
Joined: Wed, 24 Mar 2010
Location: K. Puki Manis

Re: Getting hard to find tenants for your property in Singap

Postby JR8 » Wed, 25 Dec 2013 1:23 pm

x9200 wrote: Local LLs are often filthy rich and they rather lose money than rent the place below their desired price/condition. Sometimes it goes beyond any logic and common sense.


That's letting pride, face, and ego get in the way of running a rental pragmatically as a business. And yes, this has been discussed before in relation to some local landlords here. Especially 'accidental landlords', where say a couple have a flat each, get married and use the 2nd as a rental investment. It's likely that neither are equipped/knowledgeable to be a decent landlord. And furthermore, rather than treating your home as a business investment, you are living in 'one of their homes'. This is not just SG. As an owner you have an emotional connection to your former home, that does not exist for a property you've acquired solely to let.

The 'won't budge on price pride-thing' is not unique to SG. I've experienced it too in London. I saw a property, a big old dump on an absolutely AAA street. The potential for doing an internal rebuild and fit-out was clear to see. But rather than the owner (a Greek-Cypriot) doing it himself, he was trying to sell it at a price that incorporated maybe half the potential uplift. I made an offer that made it viable as a development project, and the agents reply was 'No, he's said he won't take a penny less than the full asking price'. End of discussion lol...

re: Your anecdote.
Precisely. If someone is being an ass before closing a sale, then you can but imagine what they'll be like afterwards.

User avatar
JR8
Immortal
Immortal
Posts: 16514
Joined: Wed, 24 Mar 2010
Location: K. Puki Manis

Postby JR8 » Wed, 25 Dec 2013 1:49 pm

FaeLLe wrote:Average rental is the same as what I am asking for as per URA website for District 12. It's around $4500 pm for the 3 bed room square feet I have. Even my agents say my asking price is reasonable.


Comparing it to 'D12' doesn't help. Look at the URA site, look at rentals in your condo over say a 2 year view. Look specifically at units the same size as yours is.

Also look back at the ebb and flow of lettings according to month. You could also simply graph it in Excel to get a clearer idea of 'seasonality', i.e. #lettings per month versus month of the year.*

[Armed with that knowledge, and in future, you could then seek to plan how to word your tenancies, and for what terms, so that a future tenant is dissuaded from vacating in Q4].


* If you do this, please post an image of it here. I think it would of interest and use to other people.

p.s. This kind of analysis is also useful as a tenant, when a landlord demands an $x rent-review. You can look at the URA figures, as above, and model what current rents are versus when you first took a place. I've done this to successfully negotiate a rent reduction upon renewal!

User avatar
Wd40
Director
Director
Posts: 3788
Joined: Tue, 04 Dec 2012
Location: SIndiapore

Postby Wd40 » Wed, 25 Dec 2013 2:08 pm

Are you renting for the 1st time? At $4500, you need a proper expat to rent it, someone with company paid rent or you will need a group of 3-4 bachelors to rent it.

I agree with JR8, this time of the year not too many expats get relocated here, which may explain the lull. Also D12 is not exactly an expat hotspot, so expect some difficulty to rent it out.

User avatar
sundaymorningstaple
Moderator
Moderator
Posts: 34273
Joined: Thu, 11 Nov 2004
Location: Still Fishing!
Contact:

Postby sundaymorningstaple » Wed, 25 Dec 2013 7:57 pm

Personally, I believe it is the exact same reason why people cannot find jobs in Singapore (relatively speaking) between November and February. Year end people don't move while waiting for bonuses. Therefore, rentals don't generally start moving until late January either. I think you put it up on the market at the wrong time. Add to that the crimp in getting EPs as well and I think you would really have to make it attractive to find a renter until February.

User avatar
JR8
Immortal
Immortal
Posts: 16514
Joined: Wed, 24 Mar 2010
Location: K. Puki Manis

Postby JR8 » Wed, 25 Dec 2013 10:46 pm

Wd40 wrote: Also D12 is not exactly an expat hotspot, so expect some difficulty to rent it out.


It's not an expat ghetto like 'Holland' vicinity can be, but there are pleeeenty of expats in D12, because you get significantly more bang for you buck, and a little more peace and quiet than in D9/10/11. So if you have a child or two, and need a spare room for visitors, a 3 bedder in D12 is a practical choice vs anything more central.
viewtopic.php?p=671405#671405


I’ve lived in one condo in D9, and two in D12, and there seem to be plenty of expats in D12. Not all whiteys of course. The last D12 place had many Japanese and Koreans too. Aussies too, and a handful of EU. Same sort of thing in the current place, though I haven’t come across any EUers yet. My neighbour is sort of anglicised (via attending a UK uni) Malay. Next to her is a super-friendly young Korean family. I don’t know the people at the other end of the floor (they look/behave pretty local though).

- Interesting observation from SMS about holiday season tying with bonus ‘lock-down period’. Double whammy. All the more incentive to write the lease so as to tie a tenant in through this period.

Beeroclock
Reporter
Reporter
Posts: 718
Joined: Thu, 31 Oct 2013

Postby Beeroclock » Thu, 26 Dec 2013 11:40 am

FaeLLe wrote:
Wd40 wrote:May be your rental expectations are way above the market? What is your expected rental and which condo is this?


Average rental is the same as what I am asking for as per URA website for District 12. It's around $4500 pm for the 3 bed room square feet I have. Even my agents say my asking price is reasonable.

In fact the pictures show the superior condition of the unit so it should stand out over others in the same condo.

Let's see I have put in 6 months of mortgage repayments in the bank so I might rather let it go un - rented than for a lower price.


Tough one.... Definitely seems you're unlucky with timing. Personally I'd be open to try incentivize if it enables you to get someone in earlier, i.e. as 2 months rent is $9k. However not much you can do until the agent at least starts finding some interested parties. good luck

PNGMK
Director
Director
Posts: 4857
Joined: Thu, 21 Mar 2013

Postby PNGMK » Thu, 26 Dec 2013 2:32 pm

Beeroclock wrote:
FaeLLe wrote:
Wd40 wrote:May be your rental expectations are way above the market? What is your expected rental and which condo is this?


Average rental is the same as what I am asking for as per URA website for District 12. It's around $4500 pm for the 3 bed room square feet I have. Even my agents say my asking price is reasonable.

In fact the pictures show the superior condition of the unit so it should stand out over others in the same condo.

Let's see I have put in 6 months of mortgage repayments in the bank so I might rather let it go un - rented than for a lower price.


Tough one.... Definitely seems you're unlucky with timing. Personally I'd be open to try incentivize if it enables you to get someone in earlier, i.e. as 2 months rent is $9k. However not much you can do until the agent at least starts finding some interested parties. good luck


Incentivize means to offer one month free rent in the first year or perhaps a cash back bonus for signing on (may be illegal for some expats). Alternatively increase price by $1500 and offer a free leased vehicle in the deal (some expats can't get vehicle allowances - this is a way around it by turning it in a property lease). Also check your agent isn't scaring them off with crazy commission nonesense.

Beeroclock
Reporter
Reporter
Posts: 718
Joined: Thu, 31 Oct 2013

Postby Beeroclock » Thu, 26 Dec 2013 4:07 pm

PNGMK wrote:
Beeroclock wrote:
FaeLLe wrote:
Wd40 wrote:May be your rental expectations are way above the market? What is your expected rental and which condo is this?


Average rental is the same as what I am asking for as per URA website for District 12. It's around $4500 pm for the 3 bed room square feet I have. Even my agents say my asking price is reasonable.

In fact the pictures show the superior condition of the unit so it should stand out over others in the same condo.

Let's see I have put in 6 months of mortgage repayments in the bank so I might rather let it go un - rented than for a lower price.


Tough one.... Definitely seems you're unlucky with timing. Personally I'd be open to try incentivize if it enables you to get someone in earlier, i.e. as 2 months rent is $9k. However not much you can do until the agent at least starts finding some interested parties. good luck


Incentivize means to offer one month free rent in the first year or perhaps a cash back bonus for signing on (may be illegal for some expats). Alternatively increase price by $1500 and offer a free leased vehicle in the deal (some expats can't get vehicle allowances - this is a way around it by turning it in a property lease). Also check your agent isn't scaring them off with crazy commission nonesense.


Yeah exactly. If you give a rental discount I agree it's a good idea to show it clearly, as a free month, or Rent = $4500 minus $X (which is a one-off incentive for the first Y months). That way easier to remove the discount afterwards if it becomes a longer-term rental with the same tenant.

But the first thing is the agent, you at least need to find an interested party to offer this incentive to.... Is there anything the agent can be doing to stir up more interest despite the weak market timing. When you said it's advertised on Singapore Expats website, but I assume it's also being marketed via other advertising channels also. And has the agent allowed co-broking with other agents or not. While I find the co-broking practice annoying, it does seem to be the way things are done here and if you (or your agent) don't allow it then your pool of prospective tenants could be reduced considerably.


  • Similar Topics
    Replies
    Views
    Last post

Return to “General Discussions”

Who is online

Users browsing this forum: No registered users and 11 guests