Rents for non-landed homes in the Rest of Central Region (RCR) are rising steadily, narrowing the rental gap between the prime districts and the RCR, according to CB Richard Ellis (CBRE).
Rents in the RCR climbed to S$3.36 psf by the third quarter of this year, up from S$3.15 psf in 2010.
“The increase in rents in the Rest of Central Region corresponds to the rise in the number of small-format sized apartments in Serangoon, Balestier and Geylang over the last few years,” said Li Hiaw Ho, Executive Director of CBRE Research.
“Renting in the city fringe area, near the CBD, is a viable option with more expatriates having switched over to local packages in recent years.”
Rents in the prime Core Central Region (CCR) posted a lower increase of 15.6 percent over the 2009 – 2010 period.
Since 2009, the gap between rents in the CCR and RCR has narrowed, from 29.0 percent in 2009 to 24.5 percent in Q3 2011.
By the end of 2011, CBRE expects the gap to stabilise at about 26 percent, as rents in both the RCR and CCR are set to remain at current levels in the coming months.
“Rents are likely to stabilise in Q4 as leasing activity eases. The sluggish economic growth projected for 2012 may translate to reduced job opportunities for expatriates,” Li said.
“Coupled with a high number of new completions in 2011 and 2012, there will be some pressure on rents going forward.”
To contact the journalist, you may send your message to editor@propertyguru.com.sg