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Guide to Renting out HDB Flat

· Rental

Renting Out A Property

What To Take Note

- Only Singapore citizens who have fulfilled the 5-year Minimum Occupation Period (MOP) are allowed to sublet the entire HDB flat

- Singapore citizens who have not fulfilled the MOP are allowed to sublet rooms but not the entire flat

- Singapore Permanent Residents (SPR) are allowed sublet rooms but not the entire flat, even after fulfilling the MOP

You can

- check your eligibility with Singpass

- to sublet the entire flat (Log in with your SingPass and go to: My Flat > Purchased Flat – Subletting > Subletting of Whole Flat)

- You must apply for approval from HDB before subletting the entire flat

- Rooms of HDB flats that are 3-room or larger can be sublet without prior approval from the HDB

- You must notify HDB within 7 days of the commencement date of the lease

- You must notify HDB of tenancy terminations, renewals, and changes to tenants’ particulars within 7 days of such changes 

Non-citizen tenant quota

- There is a quota for tenants who are non-Malaysian SPR and foreigners

- The quota is capped at 8% at the neighbourhood level and 11% at the block level

- If the quota has been reached, only Singaporeans and Malaysians can rent a flat in the neighbourhood and block

- You can check the quota using HDB’s e-Service 

Eligibility conditions for tenants

- Subtenants must be any of the following

. Singapore citizens

. Singapore Permanent Residents

. Non-citizens legally residing in Singapore who hold passes with a validity period of at least 6 months from the date of your subletting application

- Employment Passes

- S Passes

- Work Permits

- Work Permit holders from the construction, marine and process sectors must be Malaysians

- Student Passes

- Dependant Passes

- Long-term Social Visit Passes

You are not allowed to rent your HDB flat to tenants who own other HDB properties, unless

- They are divorced or legally separated

- You can only rent to one party of the divorced or legally separated couple

- Your tenants rent out their HDB flat within 1 month of renting a flat or room from you

- They own an Executive Condominium and have met their 5-year MOP 

Immigration & Checkpoints Authority (ICA) Anti-Harbouring

Homeowners who wish to rent their premises to foreigners are required to exercise due diligence in checking the immigration status of their prospective foreign tenants to ensure that they are in Singapore legally.

Before renting your room, flat or house, you are required to carry out the following mandatory checks:

- Check his original immigration pass and/or work pass

- Cross-check the particulars of his pass against the particulars on his original passport

- Verify the validity of his pass by checking with the issuing authority, which is the ICA or Ministry of Manpower 

Total number of occupants

The number of occupants, including tenants, is limited by flat type to prevent overcrowding

Flat type

Maximum number of occupants

1-room 4

2-room 4

3-room 6

4-room, 5-room, Executive 9 

- For landlords subletting rooms, all owners and authorized occupiers must continue to live in the flat with the subtenants during the subletting period

Process of renting your property

- Set your asking price. Consider engaging a real estate salesperson (property agent) who can assist you in pricing your rent

- Check that the salesperson is registered with the Council for Estate Agencies (CEA)

- Market your property. Your salesperson will assist you in this

- List your property for rent

- Screen the prospective tenants

- Check if your property fits their criteria, such as budget, number of bedrooms, size and location

- Conduct viewing

- Negotiate with prospective tenants who will try to bargain

- Check prospective tenants’ eligibility

- Collect Letter of Intent (LOI) and good faith deposit

. LOI is an offer from the prospective tenant to rent your property. It should include the following:

- Name of tenant and NRIC/passport number

- Lease term of usually 6 months, 1 year or 2 years

- Monthy rental

- Expiry of LOI. This is the time frame, usually 7 days, for you to accept rental offer.

- Good faith deposit, usually equal to one month of rent.

- In return for the deposit, you cannot offer the property to another tenant.

- You must return this deposit in full if you do not accept the rental offer.

- You must return this deposit in full if HDB does not approve your subletting

- The good faith deposit is converted into the security deposit or the first month of rent after the Tenancy Agreement (TA) is signed

- Security deposit

. This is usually one month of rent for each year of lease term.

. The good faith deposit is converted into the security deposit or the first month of rent after the Tenancy Agreement is signed

. This will be returned without interest to the tenant at the end of the lease, after deduction of any cost for damage according to the Tenancy Agreement.

- Additional requirements. The tenant may specify requirements such as:

. Permission to sublet your property

. Permission to live with pets

. Diplomatic clause. Under this clause, the tenant can terminate the lease after 12 months by giving 2 months notice if he is no longer employed by his employer in Singapore. The tenant must show proof of transfer to other countries or cessation of employment in Singapore 

Apply for subletting approval from HDB

- For the sublet of the entire flat, you must apply for approval prior to the date of commencement of the lease

- For the sublet of rooms, You must notify HDB within 7 days of the commencement date of the lease

- You must notify HDB

. of tenancy terminations, renewals, and changes to tenants’ particulars within 7 days of such changes

. If HDB does not approve the subletting, the LOI will be voided and you must return the good faith deposit in full to the tenant 

Tenancy Agreement (TA)

- If you accept the prospective tenant’s offer, you will need to prepare the TA, to be signed by you and the tenant. This forms the rental contract

The TA should include the following:

- Your name and contact details

- Name of tenant and NRIC/passport number

- Lease term

- Monthy rental

- Payment conditions

- How and when you want the rental to be paid

- Security deposit

- This is usually one month of rent for each year of lease term.

- The good faith deposit is converted into the security deposit or the first month of rent after the Tenancy Agreement is signed

- This will be returned without interest to the tenant at the end of the lease, after deduction of any cost for damage according to the Tenancy Agreement.

- Terms for repairs

- Inventory

- Additional requirements. The tenant may have requests such as:

- Permission to sublet your property

- Permission to live with pets

- Diplomatic clause. Under this clause, the tenant can terminate the lease after 12 months by giving 2 months notice if he is no longer employed by his employer in Singapore. The tenant must show proof of transfer to other countries or cessation of employment in Singapore

- Payment of deposit and fees. Upon signing the TA, the tenant will have to pay Security deposit, less the good faith deposit already paid The first month of rent in advance

- Payment of stamp duty

. The tenant is required to pay stamp duty to IRAS to have the TA stamped within 14 days of signing it if it was signed in Singapore

. The deadline for stamping is 30 days after receiving the document in Singapore if it was signed overseas

. The tenant can e-Stamp online or at these locations listed by IRAS

Inspection and handover, your salesperson can assist with this

- Check each item on the inventory list with the tenant on or a few days before the date of commencement of the list

- Hand over the keys

BOOK A FREE APPRAISAL

We would love to help you get the most out of your property.

Should you be thinking of selling, or would simply like an update of where your property sits in today's market, book a non-obligatory discussion with one of our TemasekClass consultants.

 

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