Findings are based on ECA International’s September 2018 Accommodation Survey, which was based on the average rental price for an unfurnished, three-bedroom apartment in the mid-range expatriate market.
13 March, SINGAPORE – Rental prices in Kuala Lumpur saw a rebound after a sustained decline between 2015 and 2017, with the average rental cost for expatriates now at USD 1,621 (roughly RM6,620) per month, an increase of USD 112 (roughly RM450) or approximatley 7% from the year before.
According to Lee Quane, Regional Director – Asia at ECA International, “The domestic economy has been comparatively weak in Malaysia over the past few years, and the delivery of large stocks of properties to the rental market was not balanced by weaker demand. Rents for apartments staged a recovery in 2018, but Kuala Lumpur is still very affordable for a major city in the region.”
This was one of the findings of the latest research published by ECA International, the world’s leading provider of knowledge, information and software for the management and assignment of employees around the world.
Top 10 most expensive locations for expatriate rent – Asia
Meanwhile, over in Singapore, prices for expatriates have continued to drop and are now on average, USD 500 cheaper per month than in 2016. Rental prices for an unfurnished, mid-market, three-bedroom apartment in areas commonly inhabited by international executives in Singapore average USD 4,215 a month, a drop of 1.3% compared to the previous year.
“Reductions in the population of non-residents in Singapore, a key driver of rental demand, has led to continued drops in rental prices for expatriates,” explained Lee Quane. “Recent announcements in the Singapore Budget 2019 have further limited the proportion of foreign workers that companies in the services sector can employ, to 35% by 2021. This seems to imply that the downward trend in rents will continue, as the availability of properties increases with little anticipated rise in demand,” he added.
Hong Kong remains the most expensive location in the world for expatriate rent, with typical expatriate accommodation costing an average of USD 10,929 per month – an increase of 4.9% from 2018.
Quane added: “The main driver of increased rent across Hong Kong in 2018 was the limited availability of housing, which has been a long-term issue for the Hong Kong housing market. Rent increases are not just limited to central Hong Kong anymore either; rents are expected to rise throughout outlying neighbourhoods in 2019 too, as international firms seek more affordable office spaces and leverage options in cheaper suburbs.”
Rental costs in Tokyo have risen at a quicker rate than Hong Kong, with typical expatriate accommodation now averaging USD 8,668 per month. This rise of 6.9% makes Tokyo the second most expensive Asian location in ECA’s survey.
Chinese cities endured a mixed fortune throughout 2018, with major rent increases seen in some locations, but static or decreasing levels of rent in others. Shanghai was the highest placed Chinese city and the eighth most expensive city for expatriates to rent in globally, averaging USD 5,305 per month.
Quane explained, “With a new property tax mooted to be introduced in Shanghai from 2020, many landlords are now choosing to sell their properties rather than to continue renting them out. This has led to a reduction in the availability of rented accommodation, prompting some rent increases.”
Bangkok entered the top 10 most expensive Asian locations for expatriate accommodation for the first time, following the city’s rise in average rental prices this year.
“Increases in rents reflect a continuation in foreign investment in Thailand. Thailand remains a popular regional destination for many MNCs. However, they have been joined by newly globalising companies from China, which has led to a higher demand for rental accommodation from an expatriate population that typically rents in a relatively small geographical area in central Bangkok. Furthermore, the growth in tourism in Bangkok has also had an impact on rental prices, given the increase in the number of properties being converted from long-term to short-term rental to cater to this demand,” explained Quane.
NOTE: The ECA Report provides comprehensive and reliable information for locations worldwide on the rental tr nds, types of accommodation and districts commonly sought by expatriates. To ensure impartiality and to maintain the accuracy of information, data from a number of sources are used to compile each accommodation report. ECA uses a global network of estate agents, relocation agents and extensive in-house research into worldwide property markets to establish and verify the housing data in the reports.