SINGAPORE: A new class of serviced apartments with a minimum stay of three months will help plug gaps in the market for those who have short-term housing needs, such as those waiting for their renovations to be completed, said property analysts.
Minister for National Development Desmond Lee said on Wednesday (Nov 29) that Singapore will pilot a new class of serviced apartments, with tenants having to stay at least three months.
Currently, tenants in serviced apartments are required to stay for at least seven days. This means potential tenants – Singaporeans and foreigners – are up against those in Singapore for short stays, such as tourists and business travellers, said Mr Desmond Lee.
ERA Singapore’s key executive officer Eugene Lim said these new serviced apartments will cater to those with short-term housing needs, such as exchange students, those on short-term work assignments or those waiting for their renovations to be completed.
“These longer-term stay serviced apartments offer an alternative for those facing challenges renting short term from the open market,” said Mr Lim.
His sentiments were echoed by Huttons Asia’s senior director for data analytics Lee Sze Teck and OrangeTee and Tie’s senior vice president of research and analytics Christine Sun.
“Most, if not all, private landlords prefer a two-year lease,” said Mr Lee Sze Teck.
“This new serviced apartment with a stay may address a gap in the market. Besides addressing local demand for short stays, it can also cater to medical tourists, working professionals on short-term contracts and even students on internships.”
There are “not many options available” currently for people who need a few months of rental, said Ms Sun, adding that these new serviced apartments will offer more flexibility.
She said: “It may be necessary to provide more flexibility for tenants if they require a longer stay. Some people who need short-term rentals may not be able to commit to a fixed timeline or may have more uncertainties in their plans.”
The pilot will start with two sites at Upper Thomson Road and Zion Road under the Confirmed List of the Government Land Sales (GLS) Programme for the second half of 2023.
The sites will be launched in early December, with a total potential yield of about 535 serviced apartments. Both sites are located next to existing MRT stations.
ERA’s Mr Lim said tenants who choose the Zion Road site are likely to be foreigners or single professionals working in the central business district. This is because it sits on the edge of the core central region.
“Serviced apartments also cater to those who prefer housekeeping services and ensuite amenities that condominiums may not provide,” he added.
The two sites will likely draw bids from developers with the relevant expertise or have subsidiaries that are in the business of managing such properties, Mr Lim said.