ASIA PACIFIC UPDATES...in Xujiahui, only high-rise apartments and serviced apartments. There is good...

Issue 20, September 2014

ASIA– PACIFIC UPDATES Dear Friends,

Welcome to the latest edition of the Reloc8 Asia

Pacific Group Newsletter.

I think all of us in the relocation industry appreciate

that - of all the areas of our business - housing is

perhaps our single most important concern.

Without a good place to live, it is pretty difficult to

imagine a successful relocation outcome. That is

why we have decided to devote this entire issue to

housing in our region. In this issue you will find we

have outlined key trends in the rental housing

market in each of our countries, provided price

ranges for 2 bedrooms apartments and for serviced

apartments as well. We hope this will help

everyone achieve better results in this most critical

sector of our business. Rental figures and feedback

indicate that demand for serviced accommodation

is increasing region-wide, and rental prices in most

areas have risen in response.

As always, if you have clients travelling to our part

of the world please let us know as we will always

do our best to help them find a happy home.

(www.reloc8asia.com)

Kind regards

Ken Arbour

President

www.reloc8asia.com

http://www.reloc8

Housing Updates

Housing rentals are one of the major costs companies face when assigning their employees to work overseas, and in

the Asia Pacific region prices can change rapidly. Please see the Table below which lists typical rental prices in

September 2014 for Low, Medium and High standard 2-bedroom apartment accommodation in each of our cities. We

include a comparison with 2013, so you can more easily see if there has been a fluctuation. We have also pointed out

any key trends in the rental housing market in each of our regions. This information is a general guide only. Please

contact our members for more detailed information.

www.reloc8asia.com

Housing Market Trends, September 2014

Location

Prices for a 2-bedroom

apartment (USD) September

2013 Medium

Prices (USD)

Comments on

Availability Other Trends / Market Changes

Low Medium High

Lower

North

Shore,

Sydney

(Australia)

2,600 2,350 3,900 2,900

In this area,

there is good

supply of

properties of

this size. There

is no significant

pressure on

price.

A vacancy rate of 3% (% of rental

properties not currently leased to tenants)

is considered to be a "balanced market"

with no undue pressure on rentals, and

reasonable choice for prospective tenants.

However recent experience in Sydney has

been of much lower vacancy rates ( 1.4% in

the March quarter of 2014) placing

pressure on new arrivals to make decisions

quickly from a limited number of options.

Vacancy rates do fluctuate seasonally, and

the winter months of July and August have

seen a slight improvement to 2.0%.

Xu Jia Hui,

Shanghai

(China)

2,200

-

4,300

4,550

-

7,400

8,100

-

10,600

4,200

-

8,300

Xu Jia Hui is

one of the

more popular

areas to live in

in Shanghai.

There are no

villas available

in Xujiahui,

only high-rise

apartments

and serviced

apartments.

There is good

availability for

all apartment

sizes.

Expatriates are

spread

throughout the

city.

Multinational companies (MNCs) continue

expanding their investment in Shanghai,

which means there is a continued inflow of

expatriates. The continued growth of MNC

investment in Shanghai also brings with it

more local hire and domestic transfers into

Shanghai. This has increased the demand

for low-medium range properties across

the city. The higher demand for lower

budget housing, plus increases in the cost

of living, have pushed up the cost of lower

budget housing. Meanwhile, the demand

for good expatriate-style accommodation

in the usual hotspots of Shanghai remains

strong.

Property purchase prices are falling in

Shanghai. As a result of government policy

intervention, major real estate investment

activity has slowed in 2014, and no major

residential projects have come onto the

market this year.

Rental prices for mid to high end

properties are expected to remain at

current levels or increase slightly in key

areas of Shanghai.


http://www.reloc8

September, 2014

www.reloc8asia.com

Serviced Accommodation Updates

Location


apartment (USD) September 2013

Medium Prices

(USD)

Comments on

Availability

Other Trends / Market

Changes

Low Medium High

Mumbai

(India)

907

-

1,320

1,320

-

1,800

1,800

-

2,640

1,210 - 1,615

Availability

continues to be

very good. Several

new expatriate

standard housing

communities are

currently under

construction and

estimated to be

completed by

2015.

Mumbai has seen a drop in

demand for high-end expat

rental properties. More and

more relocations are utilizing

localized packages. Even

though the demand may

have reduced, it has not

impacted the rental prices

and Mumbai continues to be

amongst the most expensive

cities in India in terms of

housing.

Roppongi,

Akasaka,

Azabu/Hiroo,

Tokyo

(Japan)

3,000

-

5,000

6,000

-

8,000

10,000

-

12,000

7,500

There is moderate

availability in all

price ranges.

The market has been steadily

rising for the past 3 years and

is expected to continue at

about 5%to 10% per annum.

Bangsar,

Kuala

Lumpur

(Malaysia)

1,600

-

2,500

2,800

-

4,900

5,000

-

10,000

2,500

-

4,000

Low end and

medium end

apartments are in

the highest

demand so

availability could be

stressed during the

summer months.

Low to medium range

property prices continue to

rise at a slower pace than

previously. The Ringgit has

been strengthening against

other currencies, particularly

the USD, which has

contributed to an increase in

rental rates.


http://www.reloc8

Location

Prices for a 2-

bedroom apartment

(USD)

For

Comparison:

September

2013

Medium

Prices (USD)

Comments on

Availability


Changes

Low Medium High

Auckland

(New Zealand) 2,440 3,190 3,500 2,900

In Auckland demand

for 2 bedroom

apartments is very high

and availability very

low. In fact, there are

very few middle range

apartment complexes

in Auckland.

Free-standing houses

are much more

popular.

The overall housing market continues

to expand with new facilities opening

and others under construction. The

increase in supply is being absorbed by

rising demand. Factors in the growth in

demand continue to include the

increase in project-based assignments

of 1-6 months duration. Rentals in

Auckland are rising at 5-10% per year

despite the growth in supply. This is

pushing rentals up. In Wellington,

however, rental prices and demand

remain stable.

Makati City/

Pasig City & The

Fort, Taguig City,

Manila

(Philippines)

2,000

-

2,500

3,000

-

3,500

4,500

-

5,000

3,000

-

3,400

In Makati City, homes

within gated

communities are

scarce due to the

demand from

families. However,

there is an ample

supply of

condominiums in the

CBD, as well as a large

supply of

condominiums in both

Pasig City and The

Fort, and in Taguig

City. Makati’s luxury

inventory will increase

by 800 units within

the next 3 years. The

Fort will be adding

some 510 units in

total by the end of

2014: the first tower

of the new Arya

Residences complex

was completed early

this year, and the top

floors of the second

tower are nearing

completion.

The building boom has rallied on

unabated for nearly seven years,

gaining even more velocity in the last

three. Activity in Makati is

concentrated in the high-end and

luxury residential sector as the district

remains the first choice for prime

condominiums. The market is divided

between owner-occupants and

investors hoping to turn a profit,

however the majority of the

investment is driven by demand from

secondary tenants searching for units

available for lease. Investors and

expatriates drive the demand for

spacious and high-end apartments in

premium residential condos, while

demand for subdivisions, townhouses,

and condominiums is driven by the

increased purchasing power of the

middle-class. The high-end residential

market is expected to have modest

growth in 2014 as a result of

weakening buyer sentiment. There are

a number of high-end developments

throughout the central business

districts which will keep the supply and

demand balanced, resulting in a

modest rent and price evolution.

Issue 20, September 2014 www.reloc8asia.com

Housing Updates

http://www.reloc8

September, 2014

www.reloc8asia.com

Location


apartment (USD)

For

Comparison:

September

2012

Medium

Prices (USD)

Comments on

Availability


Changes

Low Medium High

Novena,

Orchard

(Singapore)

3,650 5,250 7,500 6,250

Availability is good.

Rental prices have

been declining since

2013 because of

greater supply and a

slowdown in

demand. The decline

is across different

price bands but

includes popular

condos which have

shown more

resistance to decline

in the past.

With a greater supply of condos

coming on the market, we expect

rents to fall further. Landlords are

becoming more realistic and are

not holding out for higher rents.

Landlords are also more receptive

to personal leases as more

companies move away from

corporate leases for their

employees. The rental market

moves very quickly in current

market conditions where

landlords are willing to negotiate

and tenants recognise a good

bargain.

Hannam/

Itaewon

Area,

Seoul

(South

Korea)

1,500

-

2,000

2,500

-

4,500

4,500

-

6,500

2,500

-

4,500

Availability of 1 and 2

-bedroom apartments

is low, because they

are uncommon (with

the exception of

serviced apartments.

Apartments generally

have 3 bedrooms,

and there is high

availability.

In Seoul, due to the loosening by

the government of various

regulations on property

transactions, which were aimed at

energizing the property market and

increasing transactions, the sales

and purchase property market is

beginning to emerge from a

long-term recession. During the

last couple of months, residential

property sales have increased

considerably compared to the

same period in 2013. While prices

haven’t yet gone up, there is a

strong expectation that they will in

many areas. However, despite the

fact that people are starting to

consider buying properties instead

of renting, it may be premature to

conclude that the Korean property

market recession is over. To date,

we haven’t seen much impact on

the cost of expatriate housing.

Rentals remain at levels similar to

those in 2013.



http://www.reloc8

Housing Updates

www.reloc8asia.com Issue 20, September 2014

Location


apartment (USD) For

Comparison:

September

2013 Medium

Prices (USD)

Comments on

Availability


Changes

Low Medium High

Xin Yi, Nei

Hu Area,

Taipei

(Taiwan)

2,735

-

3,100

3,735

-

5,000

5,235

-

6,670

3,485

-

4,885

Availability is high.

Most expatriates still

prefer to be live in the

Xiyi and Daan districts

rather than the Tian

Mou district, due

to the more

convenient public

transportation system

and living space

there. On other hand,

landlords in these

popular areas prefer

to rent out properties

instead of selling

them, due to high tax

in Taiwan. This

creates competition

to furnish apartments

smartly with modern

equipment. This has

directly affected

rental prices which

have risen this year.

In 2014, real estate prices in the

region are predicted to continue

their upward trend not just

because of the rising prices of

some construction materials,

but also because of an

underlying strong demand from

end-users, occupiers and

investors. Due to the high tax

costs involved in selling

apartments in Taipei, most

people tend to rent instead of

buying. This also promotes

higher rental prices . According

to government statistics,

apartment rental fees have risen

by 10-15% in different districts

in Taipei, particularly for

apartments in new buildings in

districts like Xinyi and Neihu,

which attract foreigners wanting

to live in new communities with

easy access to public

transportation and the subway

system.

Sukhumvit,

Bangkok

(Thailand)

950

-

1,750

1,750

-

3,000

3,500

-

5,300

1,750

-

2,000

Availability for 1 and 2

-bedroom apartments

in all ranges is high,

although there is

competition for

certain locations.

Homes close to the

Sky Train are

particularly in

demand. There is a

shortage of A Class

3-4 bedroom

properties, especially

homes within

compounds.

The market remains unchanged

and stable for A Class 3-4

bedroom properties, and

demand for properties that are

close to the Sky Train is still very

high. The Bangkok rental

housing supply and demand is

generally well balanced,

however high end rents are

increasing, in particular for

2-bedroom apartments, with

steep increases for some new

developments.

http://www.reloc8

September, 2014

Australia

The market continues to expand with new facilities opening and under construction, and the increase in

supply being absorbed by rising demand. Factors in the growth in demand continue to include the

increase in project-based assignments of 1-6 months duration. Costs are rising at 5-10% per year

despite the growth in supply.


Location

Prices for a 2-bedroom serviced

apartment (per month) September 2013

Medium Prices

(USD)

Comments on

Availability

Medium High

Melbourne

(Australia) 7830 9350 7450 Supply is reasonable when

booked two or more weeks

ahead. Surcharges apply for

peak seasons such as

Christmas and New Year Sydney (Australia) 9760 13000 9270


http://www.reloc8

Housing Updates

China

Beijing

Serviced apartments are generally located in the CBD and Dongzhimen areas (the east side of Beijing).

There is very limited supply on the west side of Beijing. Small sized apartments, for example studio or

1-bedroom apartments can sometimes be hard to book. They are very popular for short-term stays,

especially if the compound accepts tenants on a monthly or even daily rental basis. (In general, “short

term” means a 1 or 3-month minimum stay). A number of investment companies are purchasing

individually-owned apartments and renting them out at serviced apartment rates after redecoration, in

popular non-serviced residential compounds. The condition of such apartments does not, however,

compare to that in standard serviced apartments. While there are many serviced apartment complexes

in Beijing and Shanghai, they exist in only a few of the Tier 2 cities and do not exist at all in Tier 3 or 4

cities. In those cities, even a 4 star hotel may be difficult to find.

Shanghai

Shanghai has a large amount of serviced accommodation, ranging from local hotel chains to high-end

international brands. Top-end serviced accommodation is available in prime locations in Shanghai’s

CBD. Many companies prefer to house their short-term staff/single staff in serviced apartments due to

their central location. High-end serviced apartments in the CBD areas are always in demand, and

occupancy rates are very high. The main providers are Ascott, Fraser, JW Marriott, Kerry Center, Shama,

and Lanson Place. These generally provide studio apartments, 1-bedroom, 2-bedroom, 3-bedroom,

4-bedroom, and penthouse options. Due to the slow-down in the property sales and purchase market

in 2014, no new serviced apartments have come on to the market this year. In addition, some old

serviced apartments are closed for renovation which will, in the short term, also impact on available

supply.


Location



Medium Prices

(USD)

Comments on Availability

Medium High

Dongzhimen

and CBD area,

Beijing (China)

5,000 - 6,700 7,500 - 9,200 5,000 - 6,500

The occupancy rate in most of the serviced

apartments remains at 80-90%. Most

require long term leases, though some

serviced apartments will consider short

term leases if they have vacancy.

Shanghai

(China) 6,500 - 8,100 8,100 - 10,600 6,500 - 7,800

Expat-style serviced apartments in the CBD

are constantly in high demand, 2-bedroom

apartments in particular. Puxi has less

availability than Pudong in general. There

have been no new serviced apartments

built in Xujiahui. Supply and demand is

balanced in this region - there is no signifi-

cant shortage of or demand for serviced

apartments.

http://www.reloc8

September, 2014

India

Most Tier 1 cities have good quality serviced apartments. In Mumbai the best are the Taj Wellington

Mews, Grand Hyatt Residences, Oakwood, and Lakeside Chalet residences by Marriott. In Bangalore we

have the Grand Mercure, Oakwood and Alila in the premium category. They often provide discounts on

long term bookings or inclusions such as complementary internet, airport transfers, breakfast etc. There

are also several local serviced apartment providers which are of good quality and cater to the expatriate

population. The Ascott, Marriott, Hyatt and Oakwood continue with their expansion plans across India

and will soon have new operational properties. Since Tier 1 cities are big cities and traffic conditions

continue to deteriorate, it is advisable to find an option close to your workplace.

Tier 2 cities have privately run serviced apartments. Their quality may not always be very good. Most

expatriates prefer staying in hotels in these locations.


Location


serviced apartment

(per month)

September 2013

Medium Prices

(USD)

Comments on

Availability

Medium High

Mumbai

(India) 5,900 10,000 N/A Most of the good quality serviced

apartments have high occupancy

rates. It is therefore advisable to

book in advance. Bangalore (India) 4,500 9,000 N/A


http://www.reloc8

Housing Updates

Japan

Serviced apartment supply in Tokyo is very different from other cities. Tokyo has major suppliers such as

Oakwood, Ascott, and Mori, who have multiple sites. Tokyo also has a large supply of second tier

accommodation that is more Japanese oriented (that is, smaller units), provided by a variety of other

suppliers. Osaka/Kobe ranks second, with a few major properties that offer quality apartments,

however the number is far fewer than Tokyo. Outside of these two cities, serviced apartments become

much more difficult to find.

Malaysia

Serviced apartments in Kuala Lumpur are of good quality, including big names like Ascott , Lanson Place

and Somerset. In other cities such as Penang and Johor, the selection of serviced apartments is not as

good. There are two or three serviced apartment complexes in these locations, but they are old and not

very well maintained. We are now, however, seeing new serviced apartments being built in these cities

which will be available in about two years.


Location


apartment (per month) September 2013 Medium

Prices (USD)

Comments on

Availability

Medium High

Minato-ku, Tokyo,

(Japan) 7,000 $10,000 6,500

Availability is extremely

tight.

Osaka, (Japan) 7,000 - 10,000 15,000 - 17,000 7,000 - 10,000

Location



Prices (USD)

Comments on

Availability Medium High

Bangsar, Kuala

Lumpur

(Malaysia)

2800 - 4500 4800 - 6000 2500 - 4000 Serviced apartments

are readily available

except during the

summer months. Penang (Malaysia) 1000 - 1500 2,000 2,013

http://www.reloc8

September, 2014

New Zealand

Serviced accommodation in New Zealand remains stable.


Location



Prices (USD)

Comments on

Availability

Medium High

Ponsonby & Parnell

Areas, Auckland

(New Zealand)

5,400 5,875 N/A

Available

Wellington

(New Zealand) 4,675 5,615 N/A


http://www.reloc8

Housing Updates

Philippines

New players in the hospitality industry have recognised the demand for serviced accommodation and

have begun renting fully furnished apartments from individual owners, converting these apartments

into boutique accommodation and providing the same services offered by serviced apartments.


Location



Medium Prices

(USD)

Comments on

Availability

Medium High

Makati City, Manila

(Philippines) 4,300 7,000 5,600

There is limited serviced

apartment accommodation in the

areas of Makati City and the Fort

Global City. Ascott and Oakwood

are the only serviced apartment

groups that offer short-term or

temporary housing . Ascott will be

opening at the Fort at Global City

at the end of 2014.

Cebu City

(Philippines) 2,930 5,300 3,500

Availability is limited as Cebu is

only now seeing the need for

serviced apartments. Most

short-term expatriates are placed

in corporate hotels such as

Diamond Suites and Marriott.

http://www.reloc8

September, 2014

Singapore

There are different types of serviced accommodation in Singapore. Regular serviced

apartments are licensed to provide serviced accommodation with a minimum requirement of 7 days

stay. There are also serviced residences that provide short or long-term lease accommodation. These

are mostly privately owned properties that are collectively managed by a provider or one owner. Prices

vary with location, length of stay and the standard of quality of the property. A word of caution for

those considering a short lease with a non regular serviced apartment: There have been issues with

authorities in the past with privately owned properties being operated as serviced accommodation on

short leases. These are usually apartments found in private condos and they tend to offer more

competitive prices than the licensed providers.

South Korea In Korea, with the exception of in Seoul, there are no serviced residence options.

There are some very small-scale operations, but they cannot really be classified as serviced apartments


Location



Medium Prices

(USD)

Comments on

Availability

Medium High

Novena, Orchard

(Singapore) 8,000 - 10,000 10,500 - 12,500 10,000

2014 has seen a fall in

occupancy in many serviced

apartments. They are therefore

more open to negotiation,

particularly for longer leases.

Lower-cost serviced apartments

will always be in higher

demand.

Location



Medium Prices

(USD)

Comments on

Availability

Medium High

Hannam/ Itaewon

Area,

Seoul (South Korea)

5,000 - 6,000 8,000 - 12,000

170 - 200 (daily rate

based on the con-

tracted term)

Availability is tight


http://www.reloc8

Housing Updates

Taiwan

Choices of serviced accommodation are very limited in Taiwan, especially

outside the capital city of Taipei. In Taipei, fewer than five serviced apartment complexes are available

for temporary stays and these range from basic units to high-end ones. Of these, only two are full

serviced apartments and are mostly operated for long-term occupiers. In Taichung, where demand is

lower, the supply is also very limited. Most expatriates who would usually choose serviced

accommodation options choose instead to stay in hotels.


Location



Medium Prices

(USD)

Comments on

Availability

Medium High

Taipei (Taiwan) 3,500 8,670 3,500

Although there is an increasing

number of serviced

accommodation rooms becoming

available in the capital, demand is

also increasing. Quality and

location are two major concerns.

Taichung (Taiwan) 4,500 6,330 4,500

There are very few serviced

apartments in Taichung so

finding availability can be very

challenging at times. Hotels are

preferable.

http://www.reloc8

September, 2014

Thailand

There is a very good supply of serviced apartments in Bangkok, with many new properties launched in

the past few years. International providers like Marriott, Oakwood, Ascott, Somerset and Fraser and a

local group called Centre Point are present in Bangkok. Outside Bangkok the availability is low. Serviced

accommodation is popular as an alternative for business travellers as well as for long-termers.


Location



Prices (USD)

Comments on

Availability

Medium High

Sukhumvit,

Bangkok

(Thailand)

3,200 4,700 4,000 Good


http://www.reloc8

Woodhams Relocation Centre

Australia

Nick Woodhams

[email protected]

Asia Pacific Access

China

Shelley Warner

[email protected]

Ikan Relocation Services

India

Anjana Ganpathy

[email protected]

Tokyo Orientations

Japan

Kenneth Arbour

[email protected]

Pathfinder Relocation

Malaysia

Triona Chelliah

[email protected]

Annexus Relocation

Philippines

Dornet G. Venturanza

[email protected]

Woburn International

New Zealand

June Ranson

[email protected]

Asian Welcome

Singapore

Lee F. Wong

[email protected]

Reloko

South Korea

Yonjoo Oh

[email protected]

Eastgate Relocation

Taiwan

Mich Chu

[email protected]

Pacific Orientation

Thailand

Leo E Alexandersen

[email protected]


Our Members

mailto:[email protected]





http://www.pacificorientation.com/mail.php

http://www.reloc8

ASIA PACIFIC UPDATES...in Xujiahui, only high-rise apartments and serviced apartments. There is good...

Documents

Transcript of ASIA PACIFIC UPDATES...in Xujiahui, only high-rise apartments and serviced apartments. There is good...