Rental market: Co-living operators see more enquiries from private landlords

[00:00:00]Smaller rooms but bigger returns. With Singapore's private rental market stabilizing after years of rising rents, demand for more affordable and flexible housing is prompting more landlords to rethink the traditional single tenant model. Some co-living operators say they're receiving more inquiries from landlords looking to convert to multi-tenant rental. One analyst says the trend is set to grow driven by strong demand from students, professionals, and smaller households.

[00:00:29]Alexandra Anand reports.

[00:00:33]This looks like a studio apartment. It has its own kitchenet, its own bathroom, even its own laundry machine. But it's actually just one of eight rooms inside this house in Pasio Panjang. Each home to a different tenant. For its owner, renting to a single family no longer made financial sense. I had a condo unit before. Um 2020 to 2023, right? For that 3 years, right? Uh renting out to a family unit did not um the amount that we rent out, the the rent that we got was not enough to cover my mortgage. I would be like at least 20 to 30% short in terms of paying my mortgage.

[00:01:13]>> So, she spent $200,000 redesigning this 30-year-old landed property for co-l livingiving and getting help from an operator to manage it. Since then, her rental revenue has increased by around 50%. And she's not alone. Some co-l livingiving operators say they've seen landlord inquiries increase by as much as four-fold over the past year.

[00:01:33]>> I think the the most important driver is around the demand for more affordable, flexible, furnished rental uh options.

[00:01:42]Um so we've seen private rents increase, you know, around 50% over the last 5 years. affordability is really critical and renting a room is a much more affordable entry point for tenants into the private rented sector. There is now an increasing number of operators in the market. So for landlords it looks like a a more comfortable um you know alternative than perhaps it did a few years ago. But not every property can be used for co-l livingiving operators need approval from individual condo management corporations or MCSTs and not every development gives the green light.

[00:02:20]>> A lot of people when we talk about co- livingiving they always feel that oh it's it's simple right just get a unit uh rent out to individual tenants and you make money out of it. It doesn't work that way. Um there are specific location there is uh highly ten uh more tenants uh saturated >> for investor Arthur Lim that meant choosing a city fringe condominium with the right layout.

[00:02:44]>> I saw potential to create additional rooms in the large living area uh that is enough for me to place like the basics you know a bed a study table a two door wardrobe. So just very minor uh renovation works to optimize the space.

[00:03:01]>> Today his six room unit is almost fully occupied year round. Analysts say such co-living properties are becoming a more structural part of Singapore's private rental market, offering landlords an alternative way to lease their properties and renters a wider mix of housing options.