Property: Want to be a landlord? Know the expat market.

Many of us dream of having a “1+1”, i.e. owning your home in addition to a second property to let for passive income. The key thing about letting your property is, of course, to get as much rental yield as possible. Who should you target: families or singles? Western or Asian expats? Is it always necessary to furnish your unit? Here’s what the experts say.

Photo: Getty images

Price it Right

Correct pricing is the most important factor in ensuring you don’t waste precious months waiting for a tenant willing to pay what you’re asking (which may be out of line with the market). Do check with a few property agents about what apartments in your condo are going for, and what your target market is willing to pay.

Gone are the days when expats lived the high life and picked the fanciest apartment possible just because they could simply charge it to their company’s account. These days, many are given a fixed housing allowance; some may even be hired on local terms without the allowance.

“For single professionals, paying slightly over $2,000 a month on a small apartment is the norm these days. Those on a lower budget may rent a room or share an apartment with friends,” says Shernice Gow, marketing director at Century 21 Alliancz Real Estate.

Older expats, who are likely to hold higher positions in companies, tend to have fatter budgets. Some are lucky enough to be on a corporate lease. This stable, lucrative arrangement is what most landlords dream of. Experienced landlord Jimmy Ng, for example, has a two-bedroom unit at The Sail which fetches a decent $7,000 on a corporate lease.

Know Your Target Audience

Whether you are targeting tenants of a particular professional class or nationality, singles or families, it pays to know what they need and want. “Singaporeans renting a home tend to stay in the heartlands regardless of where they work because they prefer the bigger size and lower prices,” says Sabestian Mak, a property agent with ERA Realty Network. “However, for expats, it’s all about the right location and unit that best matches their needs and budget.”

They usually prefer a condominium near to the international schools, with family-friendly facilities such as barbecue pits and a pool for the kids. They’re also hungry for space, especially expats who’ve moved here from Dubai and are used to roomy mansions. “No shoebox units for them – they usually want at least three bedrooms,” says Shernice.

The savvy agent also shares an interesting tip: Should you raise the rent, families usually don’t mind forking out a little more
to avoid the hassle of scouting around for another apartment and paying for a mover.

While a unit in a prime location is always attractive, families don’t mind not being in the heart of the action as long as the project has facilities that suit the family. “In fact, some prefer not to stay too close to the office. Many like areas such as Novena, Balestier, Toa Payoh or even Tiong Bahru – just four or five stops on an MRT line to their workplace in town. 

“Unlike singles who like staying near pubs or shopping malls, families tend to look for supermarkets and good food nearby,” says Sabestian.

Singles, especially those who travel frequently for work, want a fuss-free arrangement. They come in with just their suitcases and usually require a fully furnished apartment, says Benjamin Heng, associate marketing director at Propnex. Owners leasing out shoebox units should furnish it fully to attract such busy singles. They like staying near work, which could be in the suburbs near a business park in Changi or Jurong. Single male tenants in particular prize convenience and a nice environment. 

“They don’t mind paying more, even if the place is small,” says Shernice. Top must-haves for them include being near an MRT station and food outlets since they don’t usually cook. So, it’s even more attractive if there’s a 7-Eleven in the vicinity. “However, singles are more price-sensitive than families. They can move around every year if they spot a more attractive deal.”

Sabestian also notes that some young expats under 35 prefer condos in central areas such as Clarke Quay, Orchard, Newton
and Novena. “Although the rent they pay can get them a bigger unit in the suburbs, they don’t mind living in a smaller place if it’s
closer to town and within their budget.”

So, before you leap into that million-dollar investment, ask yourself: Where is your property located? Does it have lifestyle facilities, and is it located close to amenities and schools popular with the type of tenant you are targeting? One landlord with a unit in a condo with a large Japanese community even got her agent to co-broke it with Japanese agents, and managed to lease out her apartment to a Japanese expat family within a week for a better-than-average rental.

When all’s said and done, your property’s location and the rental you’re asking for are still the key considerations for most tenants. Before you start targeting tenants, take a good, honest look at your property and what you have to offer.

Target Nationalities

Caucasian expats
ERA Realty Network agent Sabestian Mak notes that expats, particularly those from the US, the UK, Australia and Germany, place great value on condominium facilities. For example, sun decks where they can work on their tan are more important than, say, living right next to an MRT station. “As long as the station is within walking distance, they don’t mind sacrifi cing the convenience for a better lifestyle,” he says.

Benjamin Heng, associate marketing director at Propnex says that Caucasian expats moving here with their families tend to ship their own furniture over, or prefer to buy their own. “It may be better to leave your unit empty; let the tenant request for furniture, if needed,” he says.

According to Shernice Gow, marketing director at Century 21 Alliancz Real Estate, Westerners tend to maintain your property better as they usually hire domestic help. However, do watch out for fussy expat wives, especially those who are stay-at-home spouses. “One tenant at Oxley Rise, whose hidden air-con drainage pipe leads to the bathroom, complained about the ‘dripping sound’ in the toilet. But there was nothing the owner could do since the water has to drain off somewhere,” says Shernice.

“It’s all about the lifestyle for the Americans,” says Shernice. Younger Americans like projects with a nice pool because
they enjoy being out in the sun. They also prefer to be located near their workplace. Families tend to congregate near the American School in Woodlands. Some, accustomed to huge properties back home, prefer houses instead of apartments so there’s plenty of space for the youngsters. They also like unfurnished units as they tend to choose their own furniture.

The French prefer properties that are spacious and located in a quiet area such as Bukit Timah. Others also rent houses in
Serangoon Gardens, which is near the Lycee Francais de Singapour school in Ang Mo Kio. 

Popular spots include the Thomson and Serangoon area, near the Australian International School. A good barbecue pit is always a bonus for the outdoors-loving Aussies.

If the family is tagging along, British tenants normally only require a partially furnished property as they prefer to ship in their
own furniture from their previous posting. 

They are known to enjoy luxury. Hence, they like properties at Sentosa and Refl ections at Keppel Bay because they are
attracted to island life and a relaxing lifestyle, says Shernice. They are also family-oriented and will probably require a larger apartment for the family instead of living alone in a shoebox unit.

Asian expats
“Asian tenants aren’t as fussy about facilities; they’re more concerned about the rental matching their budget and being near to
amenities,” says Sabestian.

They are among the most popular tenants thanks to their polite manners. After enduring tiny apartments for years back
home, the Japanese are also more willing to rent smaller units compared to Westerners. Shernice says that as long as the property is clean, they’re pretty easy. The most important thing is being near to the Japanese schools and Japanese
community. Besides their usual haunts in West Coast, Japanese expats also favour condos such as Tanglin View, Queens in Stirling Road and Caribbean @ Keppel Bay.

They have a reputation for being easy-going. Koreans usually move to Singapore as a family, or a mother might accompany
her child to study here. Korean Christians like staying near the Korean church in Bukit Panjang. There is a thriving community of Koreans in the Upper Bukit Timah district.

“Indians, especially those here with family, prefer roomier apartments,” says Sabestian. “Older condo developments with more generous space suit them better.” Shernice, who lets her own apartment to an Indian family, adds: “They usually prefer a fully furnished apartment. They also want to be near their friends, and you can find a growing community in east-side condominiums such as Bayshore.” Other popular places include Peach Garden, Waterside and Sovereign in Katong. “In my experience, Indians tend to treat your home as their home,” Shernice adds. “Also, they’re very prompt with paying their rent – and that’s the key consideration for most landlords.”