Singapore property and rent prices are predicted to increase in 2019, with the increase of capital investments from the cross-border industries. Singapore has been the most priced silicon hub for the industries, and hence, the cost for the public as well as private sectors have increased at a significant rate.
According to the rise in the rates for private homes in the second half of 2018 has been studied and the prices for homes are predicted to rise at least 5 percent in 2019. Singapore housing market is assumed to be overpriced. However, there is a need for improving demands and supply in the hub.
As the housing demand increases in Singapore due to the rise of industries, the supply is starting to decline due to insufficient private land area. We see the rise in the potential demands from the HDB owners who are eligible to upgrade their apartments after meeting their five-year minimum occupation period requirements. HDB is the biggest contributors to the demands of the multinational companies in providing the apartments which they buy from the public developers.
In 2017 and 2018, nearly 20 billion Singapore dollars were spent for the bloc payouts. These payouts are yet to be deployed back into the property market. Most of the private developers have to pay back to the industries, and this is the year, which will constitute the maximum amount of investment. The deployment is supposed to boost S$10 billion sales-per-year condo market. As the household revenues have reached new heights, the GDP growth remains the same for Singapore. As the mortgage rates continue to rise, the home prices will continue to rise.
Other sectors, such as malls have also increased their rents to one percent compared to 2018 after a five-year decline. It is supposed to grow even more in 2019 but at a slower rate. As the supply is limited, the prices for hotels also predicted to increase at least one percent. In 2018, the prices increased three percent. 2019 will slow down the rates of biennial meetings, incentives, conventions, and exhibitions (MICE) event, which has reduced the guests to arrive in Singapore for stays.
The industries, however, demand less than what is being supplied to them. Industrial rents will inflect in 2019 after a slight decline in 2018. The possibility of gaining growth in the economy due to the rent have been predicted as positive. There has been an improvement in the leasing interest in the logistics space. The industrial tenants have been holding back to expansion plans since 2018 in public housing, which will increase the rates of the rents if paused for a longer period due to more demand and lesser estates for industrialists.