Do you have a house for rent in Singapore?
Singapore’s rental market provides a great way to access the nation’s dynamic and vibrant city lifestyle, but what does that mean for your rental prospects?
Let’s explore a complete guide to Singapore’s rental market.
Understanding Singapore’s Property Market
Singapore has a highly regulated property market, and that also includes some strict rules and regulations around renting out property.
It’s important to start with an understanding of the overall Singapore property market.
More than three-quarters of all property in Singapore falls beneath the banner of the Housing Development Board, Singapore’s public housing authority.
As of 2023, just over 20% of properties were privately owned condominiums, apartments, or landed property.
Renting Out HDB Property In Singapore
With so much of Singapore’s property managed by the Housing Development Board, renting out property in the city will often require a good understanding of the specific rules around these properties.
HDB property can legally qualify to be rented out, but only by Singaporean citizens who have qualified under a 5-year minimum occupation period (MOP).. But if your flat was bought from the open market without a housing grant (non-subsidised) before 30 August 2010, the MOP is only 3 years.
No more than 8% of a neighbourhood and 11% of a block of flats may be rented out to foreign nationals in order to maintain a positive ethnic mix within developments.
This quota does not apply to Malaysian nationals who are renting, due to the strong cultural links between Singapore and Malaysia.
There are a number of other rigorous rules which apply to renting out apartments in Housing Development Board properties, and permission must be applied for in advance either via My HDBPage or Mobile@HDB.
Minimum Residency Is 6 Months:
Residents must sign a lease that is no shorter than 6 months.
Maximum Rental Of 3 Years:
Singaporean citizens or Malaysian nationals can apply to rent out a HDB property for a maximum period of 3 years.
Maximum Rental 2 Years For Foreigners:
HDB flats can only be rented for a maximum 2-year period for non-Malaysian foreign nationals.
Maximum Residency Numbers:
HDB flats come with strict regulations around maximum residency numbers, based on the size of the flat.
A 4-room flat or bigger can accommodate up to 8 unrelated residents, while a 3-room flat can house up to 6 residents. For a 1 or 2-room flat, the maximum is just 4 residents.
Renting Out Rooms:
If you’re looking for a room to rent in Singapore in an HDB flat, it must be in a 3-room flat or bigger. Smaller flats are restricted from renting out a bedroom.
Renovating Flat To Create Extra Rooms:
Only the bedrooms that formed part of the original HDB construction may be rented out. Partitioned rooms or repurposed rooms may not legally be rented.
Renting Out Private Property In Singapore
While private properties form a smaller share of Singapore’s property market, they nevertheless provide an important part of the rental landscape.
Private property rentals face less rigorous regulation than HDB properties, making them a more attractive proposition for long-term lets.
The rental term of a private property lease is down to the agreement made between tenant and landlord, although certain conditions must be followed.
- Minimum 3-month lease: Properties marked for residential use must be rented for a minimum of 3 consecutive months.
- Maximum 6 tenants: You can have no more than 6 unrelated tenants in a given property.
- Limited partitioning: Any partitioning of a residential unit for rental purposes must maintain the integral nature of the property as a self-contained residential unit.
It’s important to ensure this agreement is covered by a formal document setting out the rules and obligations around the tenancy agreement (which a good property agent can help ensure is drafted out and enforced).
These form an important part of the relationship between tenant and landlord, and an important protection for both parties in the event of a dispute.
New Schemes and Updates from HDB
HDB has recently introduced the PPHS Open Market Voucher Scheme. This scheme allows tenants of the Parenthood Provisional Housing Scheme (PPHS) to receive an Open Market Voucher (OMV) when they purchase an HDB flat from the open market.
The OMV helps offset the flat purchase cost, providing financial assistance to young families looking for permanent housing solutions.
The Parenthood Provisional Housing Scheme (PPHS) is designed to offer temporary housing to first-timer married couples with children while they await the completion of their new flats.
With the introduction of the Open Market Voucher, eligible PPHS tenants can now receive up to $30,000 to help reduce the cost of purchasing a resale flat from the open market.
This initiative aims to provide greater flexibility and more immediate housing options for young families.
Eligibility:
- Must have booked an uncompleted HDB flat.
- For married couples (at least one first-timer), Fiancé/Fiancée Scheme applicants (at least one first-timer), or divorced/widowed parents with children.
- Must be Singapore Citizens or Permanent Residents living together.
- Monthly household income must not exceed $7,000.
- Fiancé/Fiancée couples must marry within 3 months of the tenancy period.
- No other residential property ownership, except co-ownership with parents or siblings.
Tenancy Conditions:
- Voucher covers up to 12 months of complete tenancy (e.g., 20 July 2024 to 19 August 2024) between 1 July 2024 and 30 June 2025.
- Landlord must have HDB approval to rent out the flat or bedroom.
- Landlord cannot be a close relative.
- All household members must occupy the rented address during the entire tenancy.
- Tenancy must not exceed 4 months after the completion date of the new HDB flat.
- Apply by the end of the month following the start of tenancy (e.g., for July 2024, apply by August 2024).
How to Apply:
- Ensure your landlord has HDB’s approval to rent, update your NRIC address with ICA, and pay the stamp duty for your tenancy agreement.
- Apply for the PPHS Voucher starting from 1 July 2024. The support you qualify for may vary depending on your tenancy start date and application date. If your income was previously higher but is now under $7,000, contact HDB.
- HDB will inform you of the conditional outcome in about 6 weeks.
- Notify HDB within 7 days of any changes in household members or tenancy details. For a new rented address, submit a new application.
- HDB may conduct video calls or house visits to verify your occupancy.
- Approved applicants will receive the voucher via PayNow NRIC-linked bank account in tranches up to 6 months, with the first reimbursement about 7 months after application.
8 Steps To Rent Out HDB Property In Singapore
If you’re looking to rent out your HDB property in Singapore, here are 8 essential steps to understand.
- Check that your property is eligible for rent under the HDB quota.
- Employ a registered real estate agent to maximise your listing and undertake checks.
- Decide on an asking price and list on property sites such as PropertyGuru.
- Provide viewings for prospective tenants.
- Check eligibility of lease length and tenant under HDB rules.
- Collect Letter of Intent and Good Faith Deposit.
- Sign Tenancy Agreement and receive Security Deposit.
- Ensure Tenancy Agreement is stamped by IRAS within 14 days.
7 Steps To Rent Out Private Property In Singapore
Have a private property to rent? The regulations may be slightly more relaxed, but there are still some important steps to remember.
- Employ registered real estate agent to maximise listing and undertake checks.
- Decide on an asking price and list on property site such as PropertyGuru.
- Provide viewings for prospective tenants.
- Check eligibility of tenant for residency in Singapore.
- Collect Letter of Intent and Good Faith Deposit.
- Sign Tenancy Agreement and receive Security Deposit.
- Ensure Tenancy Agreement is stamped by IRAS within 14 days.
Is Investing In Rental Properties In Singapore A Good Idea?
Singapore is an expensive place to live, with some of the world’s highest property prices. That means ensuring an appropriate rental return also requires a substantial rental rate.
Singapore’s property market is currently experiencing challenging conditions for rental properties, with average yields of just over 3%. Maximising your rental potential is crucial in that environment.
Smaller units, and those in suburban areas, have shown to provide a more positive rental yield than large apartments in central areas, and might be a good place to start when considering your rental potential.
Alongside the usual maintenance fees and on-going costs one might expect from a rental property in Singapore, it’s important to also factor in the Property Tax rates which apply to rental properties in Singapore.
A resident’s rental income is assessed based on residential tax rates, where foreign non-residents will have their rental income taxed at a flat rate of 22% for 2017 to 2023, and 24% starting from 2024.
Like any property market, Singapore offers some exciting opportunities with the right investment decisions.
But no investment is guaranteed, and in challenging market conditions, that means working hard to understand the best possible property for your rental opportunity.
What Else Do I Need To Know About Rental Property In Singapore?
Singapore’s rental market is often seen as a two-tiered system, split between the more strictly controlled but cheaper HDB rental opportunities, and more flexible, but often more expensive, private rental.
So what else do you need to know?
1. What If A HDB Rental Includes A Foreign National?
The maximum period of a lease is 2 years due to their foreign national status, despite the nationality of any other residents forming part of the agreement.
2. Can I Sub-Let My Rented HDB Property?
No, it’s forbidden to sub-let a rented HDB property, and can result in substantial penalties.
3. Do I Need To Get Approval To Rent Out A Bedroom In HDB Properties?
Yes, you need to seek HDB’s approval before renting out a bedroom. Additionally, you must inform HDB within 7 days of any changes to the tenants’ particulars or when any tenants move out.
4. Who Pays For Stamping Of The Rental Agreement?
It’s traditionally paid by the tenant, although this is not a legal requirement.
5. Do I Pay The Same Rental Tax If I Also Live In The Property?
No, owner-occupier tax rates are slightly lower than those that apply to renting out your whole home.
6. Will My Real Estate Agent Help With The Checks?
Yes, a good real estate agent should advise you on undertaking eligibility checks, as well as residency status. Although you are responsible as a landlord to ensure the eligibility of foreign renters.
7. How Do I Find An Estate Agent?
The Council for Estate Agencies provides a simple search function to check the accreditation of real estate agents in Singapore.
8. How Is A Property Agent Paid?
A property agent should be paid through commission, and only by one of either the tenant or landlord. They only receive a fee upon successful completion of a rental.
9. Can I Rent Out My Property For Short-Term Holiday Rental?
You cannot rent a HDB property as a holiday let. You may rent your private property, although Singapore law states that you can only rent a property for a minimum period of 3 consecutive months.
There are no laws against renting a bedroom within an occupied property as a holiday let.
And now, if you’re looking to ensure you get the right property to let it out successfully (nobody wants a vacant unit just SITTING there, right?), then read up on how to invest successfully with rental properties!
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