Overall luxury residential rents to drop 3-5% in 2014

Amid global economy's recovery.

As the global economy continues to recover, overall luxury residential rents will drop to a lesser degree by 3-5% in 2014.

According to a research and forecast report from Colliers International on 2Q 2014, this comes after experiencing a 19% decline since the price peak in September 2011.

Demand for luxury rental homes stabilised this quarter as expatriate families sought housing prior to the school year’s start.

The report said that although multinational companies have remained tight on housing allowances, there have been no further reductions in budgets and instead, they are pressing landlords to offer additional incentives such as increasing the rent-free period.

Also, rising local demand and an increasing number of expatriate arrivals from the junior and middle management levels resulted in stronger demand for smaller units, thus explaining the rental resilience in the mass residential leasing sector.