Singapore Replaces New York as Strongest Global Residential Rent Growth City in 2022

Singapore Replaces New York as Strongest Global Residential Rent Growth City in 2022

Residential News » Singapore Edition | By Michael Gerrity | March 17, 2023 8:53 AM ET

Global property consultant Knight Frank is reporting this week that Singapore leads the Q4 2022 rankings, pushing New York off the top spot. Singapore's annual rental growth grew from 23% in Q3 to 28% in Q4 2022, with limited stock and strong demand driving prices higher.

According to Leonard Tay, Knight Frank's Head of Research in Singapore, "Around 17,000 new private homes are set for completion in 2023 that should provide some relief to accommodation pressures.

However, until such time, it will remain a landlord's market and rents are likely to rise further." Singapore's new visa rules, introduced in January 2023, offer a five-year work visa for specific tech-based professionals who earn over S$30,000 per month, the measure is likely to supplement tenant demand further.

New York occupies second place in the annual rankings, registering 19% annual growth, with rents up 48% since their pandemic low in Q4 2020. Tight stock levels, rental listings were down 15% in December from their high in August, along with higher mortgage costs for would-be purchasers resulting in a demand/supply imbalance.

London registered 18% prime rental growth in the year to Q4 2022. Demand remains robust with prospective tenants 27% above their five-year average in November. Knight Frank forecasts rents in prime central London will rise by 6% in 2023, as potential buyers wait out the economic turbulence before looking to purchase a home.

The rebirth of the city following the pandemic sees several prime global rental markets struggling with stock. Toronto and Tokyo registered annual rental growth of 15% and 8%, respectively, with both markets facing competitive demand.

Hong Kong saw the largest fall in prime rents year-on-year, down 6.4%. As many international corporations have deferred expansion plans within the region, demand from corporate tenants has softened.

With many investors eyeing the rental market as an inflation hedge, providing shelter during economic turbulence, we expect prime investment markets to see robust activity in the short to medium-term.

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