Factors to look out for Rental In Singapore (For Landlord & Tenant)

There are various reasons for wanting to rent a whole unit or room, it could be for work reason to Singapore for overseas posting and needed accommodation for the period of stay here.

It could also be the reason of you have applied for Built-To-Order (BTO) flats from Housing Development Board (HDB) or buying newly launched condo project, and it while it takes time before the completion and handover, you and your family would require a house should you and your spouse decide not to continue staying with parents and aspired to live on your own.

So, you and your spouse decide to look out for places to stay, where it ideally located with amenities and convenience to public transport. With that being said, it means the more you rented a place near to shopping malls and transport hub, the higher you will have to pay for your rental unit.

In Singapore where the renting process is not straight forward and is not easy, not only due to rentals price for an apartment does not come relatively cheap, regulations for renting are very strict in Singapore as well.

That being said, the rules are stricter for shorter rental lease terms, example, rental lease options that are less than one year. So, for tenants out there looking to rent a place or property owners that are looking to lease out their property, these will be some of the factors you need to consider.

The Minimum Lease period in Singapore for Short Term

The minimum lease tenure depends on what type of property you are renting out or looking to rent, which will be either an HDB public flat or private apartment example a condo.

For HDB flat, the minimum that you have to rent or the property owner has to lease will be a minimum of 6 months. HDB owners will have to abide by the rules as if they risk to lease shorter than the regulated minimum requirement, they could risk getting reported and caught and that means getting their property confiscated by the Housing Development Board authority.

Furthermore, for HDB property owners, you will only be allowed to lease out the whole unit empty only if you have fulfilled the minimum requirement of MOP (Minimum Occupation Period), which is five years. Else, the only option that the HDB owner has is to rent out one or two bedrooms if the property consists of three bedrooms.

That being said, if the tenant is looking to rent one bedroom in an HDB property from the owner whom he/she have bought less than five years ago, which means it has not met the Minimum Occupation Period of five years, then, the tenant will have to live with the landlord.

And so, be sure you are feeling comfortable living with the landlord or someone else if you have decided to rent a bedroom.

An important point to note for HDB owners, do check in the HDB portal if you are unsure that your flat has met the minimum occupation period if you are looking to rent out the whole unit.

As for Private property owners example the condos or landed houses, the minimum tenure as compared to HDB property will be slightly shorter, which will be 3 months.

As a tenant who is looking out to lease private property, you may have noticed in a lot of listing portals like the short term rental, you will see Airbnb falling into this category.

In the Airbnb site, mainly the people who are looking are tourists looking for a place to stay during their short vacation stay here in Singapore only for a few days, and not for 3 months. Thus, technically in Singapore, private property owners renting out the place for less than 3 months is illegal. They might still be private landlord choose to take the risk by leasing out their property for a few days or few weeks.

Eligibility Tenant to Rent?

For property owners regardless of private or HDB flat, technically speaking, you are only allowed to lease to Singapore Citizens and Permanent Residents (PRs) or tenants holding valid passes of the country.

The tenants will need to have a valid pass example, student pass, work permit, employment pass, and a dependent pass. For work permit pass holders, employment sectors that are in manufacturing, construction, etc must be Malaysian as Non- Malaysian workers in the mentioned sectors are usually arranged to live in a dormitory.

As for Tourist visas, it is not allowed to rent for stay and are obliged to arrange for accommodation in Hotels or other budget accommodation allowed, hostels or affordable and stylish boutique hotels available in Singapore.

 

            Source: Honeycombers

Again, back to the HDB topic as there are other governing rules on HDB leasing.

This is so because HDB estates are subject to the non-citizen quota for the maintenance of ethnic mix groups. If the HDB property owner decides to lease out the whole flat, quota for Non-Malaysian tenants will be capped at 8% per neighborhood and 11% per block.

In the event when the quota is met, the HDB property owners can only rent out the entire flat to citizens from Singapore and Malaysian.

However, the quota requirement is not applicable if only single room is leasing out. That being said, HDB property owners should also take note and be aware not to lease out more than the maximum number of rooms available in the flat or allowing more than the maximum number of tenants allowed in one single flat.

Source: HDB

And a point to note, for those HDBs of 1-room or 2-rooms flat, the owners cannot rent out the flat till the Minimum Occupation Period (MOP) is met.

What about Private Property? Is it also Subject to such Ruling?

For private property such as landed houses or condominiums, the unit can be rented out to tenants who are holding on to valid pass and legally residing in Singapore due to work or students studying here for the whole duration, as long as it met the minimum requirement stay period of 3 months.

That being said, tourists are not allowed as mentioned. So, private property owners, do take note and be aware of your incoming tenants, what pass they are holding and residing in Singapore for what reason as well as duration to safeguard yourself and your property.

Some House Rules To Observe…

Negotiation will be held before signing any tenancy agreement, this is to make sure both parties (the Landlord and Tenant) understand and agrees what is and what is not included in the entire whole lease agreement and also the rent amount consist of such as the utilities cost, Wifi, Air-conditioning and maybe some minor repairs.

For example, under the repair segment, the tenant will bear the cost if he or she breaks something. As for wear and tear component, as long as it genuine case, the cost of rectifying, repairing or maybe replacement if needed, will be by the landlord subject to different circumstances.

The most common appliances that you may see and hear will be the washing machine, dryer or on rare cases, the air conditioning unit as regular scheduled servicing is arranged to clean the unit to maintain the functionality for a longer run.

Some basic house rules and cleanliness like no smoking indoor, no loud noise or music to be played as you might not be renting the entire unit and will be sharing with other tenants or even the landlord themselves. Thus, even if the tenant is on short term rental, house rules need to be established and be sure that both parties are aware of the rules and guidelines to have amicable and pleasant stay throughout the entire lease tenure.

In some cases, the landlord might also some rules of no heavy cooking, and the common ones are no bringing of visitors to the property. In some situations, the landlord may allow the tenant to have 1 or 2 visitors but only subject to Landlord’s approval and the tenant has the responsibility to inform the Landlord beforehand and seeking their approval.

So, before the rental start, do communicate well between all parties with the help of Real Estate Consultants for advice on what to look out for and what are the factors to take note of in renting a unit or renting out a unit whether you are the Landlord or Tenant.

Engaging the Service of Real Estate Agent

Looking for a place to stay or finding someone to rent your premises can be a tedious process.

For property owners, you will need to create some awareness of your rental unit via listing in available leasing portals out in the market. You will also need to clean the entire unit up and take nice unit pictures or videos for posting.

Owners will also need to prepare to arrange potential incoming tenants for viewing on different timings and sometimes it can be weird timings.

All these can be easily settled if you engage the assistance of the property agent if you want to skip all this hassles of doing it by yourself, of course, there will be commission payable for service render.

The Property Agent will also draft up a tenancy agreement for both parties to review on all the terms and conditions, agreed rental amount, and some requests if there is. Only after negotiations are done and all parties are agreeable, then signing can proceed.

Looking at the statistics of the rental market…

Source: Data.gov.sg

Source: EdgeProp

Source: EdgeProp

As for Tenants …….

For different place, location and unit type, as well as the lease term, the rental rate will vary. As a tenant, you have every right to negotiate the terms on the tenancy agreement you are not agreeable before signing.

With the help of Property Agent, they will guide you on step by step what the tenant needs to be aware of in the rental process, and also recommending you suitable unit and type base on your needs.

Generally, houses or rooms that are located near the transport hub, shopping malls, supermarkets, restaurants, and other amenities near your rented unit in Singapore will demand a higher rental rate.

In conclusion, these are some of the important points that you as the Landlord, or Tenant can look into while you are renting out or looking to rent the house. Other factors will be costs and expenses involved in the renting process, thus, you might need the professional advice of Property Agent to assist in the guidance of what potential costs and expenses will be involved.

Don’t go for the shortcuts as it might result in future disputes or arguments in the latter part of the rental.

You would not like it if it happens, later on, it might cause strain between the parties. So, so it the right way by doing yourself the favor!