12-Step Guide for Landlords in Renting out HDB Room

Good news! You can rent out your spare bedrooms after obtaining approval from the HDB, without fulfilling the Minimum Occupation Period (MOP) of five years.

One of the common questions asked by HDB flat owners who plan to rent out their bedroom is “Do I need to continue living in the flat during the rental period?” Yes, for rental of bedrooms, HDB require flat owners to continue to live in the flat along with the authorised occupiers.

Contents:

Step-by-step guide in renting out HDB Room without an agent

Step 1: Check your eligibility

Both Singapore Citizen (SC) and Singapore Permanent Resident (SPR) homeowners can rent out their spare bedrooms. There are two other eligibility conditions that landlords need to meet before renting out their spare bedrooms.

1. Flat type

You must own a 3-room or bigger flat, owners are not allowed to rent out the bedroom for 1-room and 2-room flat.

2. Bedrooms

You need to take note that only bedrooms originally constructed by HDB can be rented out. All other parts of the flat (including partitioned rooms) cannot be used as bedrooms for tenants.

Step 2: Check the tenant’s eligibility

The rental eligibility to consider is not only of your own but also of the potential occupants of your flat.

Citizenship

Singapore citizens and SPR are allowed to rent your HDB flat. While non-citizens can also rent if they legally reside in Singapore, they must hold Employment Passes, S Passes, Work Permits, Student Passes, Dependant Passes, or Long-Term Social Visit Passes.

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

You can check online if your tenant’s documents are valid:

• NRIC, Student Pass or Long Term Social Visit Pass
• Work permit
• S Pass or Employment Pass

Tenancy duration

The law prevents public housing rentals that are under six months. Hence, you must ensure that passes of your non-citizen tenants must have a validity period of at least six months at the date of your application. HDB will reject the application if it’s shorter.

Short-term rentals like Airbnb-style is illegal in Singapore. Hence, tourists are not allowed as tenants of HDB flats.

Property ownership status

Tenants must not be tenants of public rental HDB flats or owners of other HDB flats unless they are:
Divorced/ legally separated. In this case, only one party can rent an HDB flat from other flat owner
Owners who are eligible to rent out their whole flat. However, they must rent out their own flat within a month after they have rented an HDB flat from other flat owner

Tenants must not be owners of Executive Condominium units where the five-year MOP has not been met.

Step 3: Check your HDB flat occupancy cap

You might ask whether you can accept as many tenants as possible, the simple answer is no.

To prevent overcrowding, the number of tenants allowed in each HDB flat is limited by flat type. The occupancy cap for 4-room and larger HDB flats being rented out are six persons, the cap for 3-room is six persons and for smaller flats is four persons. These rules seek to minimise disamenities caused by overcrowding and to maintain a conducive living environment.

Step 4: Find out the room rental price

HDB provides the median rent of flats in various locations with rental approvals. This is a good resource to find out the cost of a whole unit rental, and use it as a benchmark for a room rental price.

For example, if you are renting out a 3-room flat in Toa Payoh, as of 3rd quarter 2019 is at $1,800. Divide the median rent by the number of bedrooms in your property.

You need to consider the room size, aircon and location of your flat. Usual rental price range for a common room without an en suite bathroom may be as low as $300 up to $750. On average, an HDB room rental with aircon is at $600.

Pricing your room rental according to market price gives you an advantage when tenants search for a property around the area. If your rental price is so much higher than the market, tenants may eliminate your listings automatically. You would lose viewing opportunities.

Use HDB’s Market Rental Rates service or the HDB Map Services to find out how much whole flats were rented out for in the past year by town and street.

Step 5: Take beautiful photos of your bedroom

Having quality images of your room for rent clearly holds the key in attracting the right tenants to your rental listing and impressing them off the bat. Do you know that 90% of the information transmitted to the human brain is visual?

With our brain processing images 60,000 times faster than text, approximately two in five people respond positively when visuals are included. Hence, listings with bad pictures, or worse yet, no pictures at all, can cause potential tenants to overlook your home altogether.

Here are some key points when taking a photo of your room for rent:

• Shoot with natural light, it’s best done before 4 pm so that the sun isn’t too low.
• Turn on all the lights
• Use horizontal orientation
• Choose what to include and what to exclude from your photos
• Kneel down when taking photographs
• Avoid taking too much of the ceiling or flooring
• Keep just sufficient furniture in each area
• Take photos from the doorway
• Feature the room’s selling point
• Put toilet lids down and hide all toiletries
• Crop to eliminate distractions
• Use free beginner-friendly photo enhancement tools

Step 6: List your room rental in 3 minutes

Now, with a rental price within the market range and beautiful photos, you are ready to list your bedroom!

Renting out your room without an agent means you do not have access to online platforms with advertising packages solely for property agents. Ohmyhome connects you directly with home searchers, you may use the website to list your property or download Ohmyhome from the Play Store or App Store.

Post your listing in 5 simple steps:

1. Create an account using either your Facebook, Gmail or mobile number
2. Choose your journey, select I am a ‘Landlord’
3. Tap ‘My Properties > Choose Room Rental
4. Enter your Postal Code > Choose the address of your property> select property type and other details
5. Upload beautiful photos of your room rental and ‘Post’

You’re all set! You just made your listing visible to thousands of tenants searching for their next home away from home!

Step 7: Suggest your room listing to ShoutOut in 3 steps

Forget about the traditional advertising space where homeowners would have to wait for home searchers to reach out to them. With Ohmyhome’s ShoutOut feature, you can suggest your listing to tenants who are actively searching for their next room rental.

Use ShoutOut in 3 simple steps:

1. Using Ohmyhome App > Tap “More” at the bottom options > View ShoutOuts
2. Filter > Tenant, Room Type, Location, Minimum rental price budget and location that matches your property > View ShoutOuts
3. Suggest your listings instantly to the matches found!

Step 8: Accept an LOI

Before sealing an agreement, you need to do a verification of all the eligibility requirements in Steps 1 and 2 as well as the occupancy cap. Verify the validity of visas on ICA’s website or MOM to check the validity of work passes.

A Letter of Intent (LOI) will be suitable at this stage to ensure that the tenant is serious in his intentions to rent your place. You may accept multiple LOI, as this a non-legally binding formal letter expressing the tenant’s intention to rent your place. This typically expires after three days.

The LOI is an early draft of the TA which includes:

• Offer price
• Start and end date of the lease
• Particulars of landlord and tenant/s
• Number of occupants
• Terms that the tenant wants to include in TA such as requests for new beds or other furniture

Should you have chosen a tenant, you need to negotiate on his requests, on what you can and cannot provide.

The LOI may be given together with a good faith deposit which is equivalent to one month’s rent for a one-year lease or two months rent for a two-year lease. You may convert this into a security deposit should you and your tenant sign the tenancy agreement (TA).

What if you reject the LOI? You must return the good faith deposit to the tenant.

Step 9: Apply for HDB approval

You must obtain HDB’s approval before you can rent out your bedroom. The LOI contains the details that you need. An administrative fee of $20 applies for each application.

Submit your application through:

• My HDBPage
• Mobile@HDB

After you have registered your tenant, you must inform HDB of any subsequent changes of any tenants’ particulars or when any of your tenants move out of the flat within seven days of the occurrence. If the lease has expired on 1 December, you should inform HDB not later than 8 December.

For inclusion of new proposed tenant, you must obtain HDB’s approval before your new tenant may move into the flat. Confirm your eligibility for renting out your bedroom. You may print the confirmation letter from My HDBPage > My Flat > Purchased Flat > Renting Out > Renting Out of Bedroom(s) > Enquiry on Tenants.

After you have registered your tenant to HDB, enquire on the authorised tenants of your flat. This allows you to print HDB’s confirmation letter showing the name of tenant registered. This assures your tenant that he has been registered and can legally stay in your property.

Step 10: Issue the Tenancy Agreement

After several viewings and negotiations, now you have secured your tenant!
Don’t forget to include the problem-free period in the TA, it is typically one month from the first day of the tenancy. You can’t hold your tenant responsible for any defects of any item, furniture and/or fittings in the bedroom during this period.

The TA aims to safeguard parties against the repercussions that come along with early termination of the tenancy by the other. It becomes legally binding, especially in the event of a tenancy dispute.

Don’t know how to create a room rental contract? Fret not! CEA provides an agreement template for the rental of HDB flats. All you have to do is download and voila! Print and get the TA signed!

Step 11: Prepare for the move-in date

You have come a long way! Before the most awaited day of concluding your rental transaction, inspect your property and prepare an inventory list. Ensure that everything is working well because you will need to do handyman work to any defects identified.

Go through the items in the list, one by one with the tenant on the move-in date. Both of you will sign the inventory list. Each party will need to keep a copy of the list.

Inventory list may seem like just another piece of paper, yet this serves as conclusive evidence of the condition of furniture and fixtures in the bedroom. Pass the keys to your tenant and collect the first-month room rental fee.

You are all set to lease out your property!

Looking for an HDB or private property?

Here’s how you can speed up your home search

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You can also call us at 6886 9009 to secure an appointment with any of our Super Agents or message us in the chatbox at the bottom, right-hand corner of the screen. You can also WhatsApp us at 9727 5270!

Sources: HDB, CEA, CEA Checklist