Positive rental momentum buoys home landlords but challenges loom

IN THE game Monopoly, players set out to own properties to grow rich by collecting rent from their opponents. Whether inspired by this game or by friends and relatives, many people here aspire to be a landlord. Own another home, besides the one that is owner occupied, and collect rent to fund retirement needs.

Private residential landlords can cheer that rents rose 9.9 per cent in Q4 2021 from a year ago, almost in line with the 10.6 per cent rise in private home prices according to data by the Urban Redevelopment Authority (URA). But rental rates of homes have generally grown at a much slower pace than prices.

Over periods of 5, 10 and 20 years to 2021, private home prices rose 26.5 per cent, 17.8 per cent and 107.2 per cent respectively while rental rates rose 9.3 per cent, 0 per cent, and 66 per cent respectively, based on URA's data.