How To Tell If A Singapore Condo Is Really A Good Rental Investment

In the property industry, one of the most dreaded questions is often: “Is this a good rental property?”

This doesn’t stem from any difficulty in getting the right rental figures. Any reasonably equipped property agent - including those on the Stacked Consultancy team - have ready access to rental rates, estimated yields, and rental performance over the years for various properties and locales. You can even check it yourself on some websites, although the degree of detail varies.

Instead, I think the crux of the issue is explaining why this question is so difficult to answer, and why the reply is usually frustrating: “Well, it depends”.

That’s because what constitutes a ‘good’ rental asset doesn’t just vary between different property owners, it also varies with time and includes factors ranging from wider market conditions to whether you’re selling the unit soon.

Let’s start with the most simple - and often most overused - number: the gross rental yield. This is the total annual income divided by the property price, and is a rough gauge of how much you’re getting back for the money you’re going to put in.

What Makes A Good Rental Yield?

The yield figure only tells you about the relationship between the rent and the price, and it doesn’t reveal anything about whether the rent is high in absolute terms or whether the property generates positive cash-flow. It’s also an opaque number when it comes to evaluating whether the price is justifiable.

For example, two-bedroom units at The Esta usually fetch a median rent of $5,300 per month (you can see a detailed study of condo rental yields here). But with a median resale price of $2.78 million, its gross yield was just 2.29%, one of the lowest among two-bedroom units in that area.

By comparison, #1 Suites generated a much higher 5.75% yield even though its median rent was only $3,500 per month, because its median price was just $730,000. Does this mean #1 Suites is a better rental asset?

That’s debatable since it’s within the radius of Geylang’s red light area, hence the lower price point in my view.

Thus, renting a two-bedder at The Esta is pricier, but it’s also in the East Coast / Amber Road area which is an established expatriate enclave and a desirable neighbourhood for many locals. Collectively it makes this one of the best rental spots in Singapore.

Then consider The Hillford, which is almost constantly at the top of Singapore’s private non-landed condos when it comes to rental yield. One-bedroom landlords at The Hillford see an average yield of 5.7%, supported by the low median price of around $589,000 of that unit type.

But this exceptional yield is because it’s a 60-year leasehold project, and it was originally intended to be a retirement-resort themed condo. In light of this, is it a “good retirement asset?”

That’s a spectacularly difficult question to answer since the lease started in 2013. This means that owners may be getting quite a bit of money out of it for the price they paid, but resale prospects are challenging when there are 47 years left on the lease.

I suppose if your intent is simply to hold on and collect rent to the very end of the land lease of the property, this is a potentially excellent rental asset. In addition there are less than a handful of cheaper options near Beauty World.

But if you view ‘excellent rental asset’ to mean rental income plus a viable exit point - or the ability to live in it or pass it down to your children - I don’t think it's the best choice.

Likewise, the average rental yield of 4.57% at Eon Shenton may appear appealing on the surface, until you notice that its five-year annualised price trajectory fell by 2.29%. Sometimes, the rental yield rises because the property price has weakened.

So, when you ask if this is a ‘good rental asset’ be prepared that the answer could be yes if we’re looking at it strictly on a yield basis. But you can start to see why a good property agent would deliver a really long and hesitant answer.

There Are Also Investors Who Prefer Certain Absolutes

I often receive a range of enquiries from retirees, or those near retirement age, who are focused on an absolute number. This can be $3,000 a month, $4,000 a month, and so forth. As long as a rental property can consistently deliver this amount, the other factors are immaterial to them.

They may not care that the rental yield is low, or that there’s no exit liquidity. In addition, they may not be bothered by factors like the age of the property or the specific facing of the unit, so long as they get the required rental amount.

In my experience, recommending a so-called ‘good rental property’ to these investors needs a different approach compared to younger aspiring landlords who have a different set of priorities, or those who foresee a need to upgrade or right-size later on.

Then there are investors whose “non-negotiables” are tied to more than rental rates. There are landlords who want a property that’s not going to be tough to manage; and this can exclude older projects where maintenance is more demanding. This can exclude resale options that are otherwise highly rentable, and would be a lower risk in terms of capital commitment.

There are also landlords who have requirements beyond facts and figures. I recently encountered a landlord like this whose Marine Parade-area condo has been vacant for seven months - much to the exasperation of their property agent, who has turned down multiple tenants.

That landlord shared that they’re happy to leave the unit vacant until someone pays the desired rental income, and they’re perfectly content with this rental asset. They won’t even consider selling it to buy something with potentially better results.

These buyers are going by a whole different matrix. That’s not to say they’re wrong - you should do what you like with your property - but it means some are happier to own a property they take pride in, and would personally consider staying, over the hard rental performance.

Another Factor Is The Desire For Cash-flow Positive Properties

Frequently, we encounter two schools of thought that optimise entirely different aspects: some want the unit to pay for itself now, while the other group (more common) sees rent as just mitigating long-term holding costs.

The cash-flow positive group wants more money coming in than going out. If there’s surplus cash after mortgage repayments, maintenance fees, or property tax, they consider the investment a success. Usually they’re not too interested in something with a better yield or greater capital appreciation if it means losing the positive cash-flow.

At the other end are investors who see rent as a way to reduce the cost of holding. This is a more common scenario, where it’s accepted that rental income is useful for covering mortgage interest or maintenance costs. It’s not considered a major drawback even if it doesn’t pay the full recurring costs.

And all of these attitudes, incidentally, aren’t set in stone. They can shift based on changing life circumstances, as well as the state of the market.

So What Makes a “Good Rental Asset?”

It depends on who is asking. The answer is far less general than many buyers assume and the less experienced you are managing rental properties, the more confusing the explanation can be, and that not least because you’re getting slightly different answers from everyone.

This is just about general rental approaches, and it hasn’t yet gotten into fine details - such as whether two-bed, two bath units are better than two-bed, one-bath units. This includes other details like whether you should buy the smallest one-bedder among available options*, or whether integrated projects are ultimately more rentable.

*We cover this in some detail here.

A detailed answer also needs to take into account tenant management. If you prefer not dealing with students, for example, an otherwise excellent rental property might fall off your shortlist; the nearest tenants may be from a nearby tertiary institute. Likewise, if you want tenants from the medical profession, you may have to ignore personal taboos about a property close to a major hospital.

This is why rental assets are far more complicated than just sitting back and collecting money. This is also why good agents and experts will, ironically, give you an answer that seems more long and confusing than a simple one.

So I think that the better question is not: “Is this good for rental?” Instead, it is: “What do I need this rental property to do for me?” That tends to produce clearer answers, and fewer nasty surprises later on.

Meanwhile in other property news…

• A reader couple in their 50s owns a condo and an HDB flat, and they’re wondering whether to sell both for a single $1.9M freehold home. Here’s how the numbers compare when it’s all sale proceeds and CPF, with no cash buffer.
• An interior designer spent $120K turning his 4-room BTO at MacPherson Weave into a Japanese-inspired Zen retreat. See where the money went.
• Applying for a BTO this month? Our November 2026 BTO launch review covers all seven projects and 7,964 flats, along with layouts, wait times and the best stacks to pick.
• We compared 11 condos within 1km of Nan Chiau Primary School to find which one gives you the most space for your money when you upgrade to a 3-bedder. Check out the options here on Stacked Pro.

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