With the high prices of property in Singapore, it is no wonder that many Singaporeans turn to rental as a means to supplement their income or pay off their mortgage. In 2016, the number of HDB flats that were rented out has nearly doubled since 2009! However despite that increase, remember that HDB flats are public housing meant for providing affordable homes for living and not as a means of investment. This means that you can be sure the Government will regulate this and HDB rental rules will be stringent. According to the HDB website, those who illegally sublet a house can be fined or have the flat repossessed so you have been warned! So if you are thinking of renting out your HDB flat please read on to find out more about the HDB rental rules in 2018.
Yield tables and rent charts are useful reference points, but the units that actually rent well and continue to attract tenants over time aren't always the ones at the top of a yield table.
The more important question is whether the investment still makes sense once you factor in holding costs, vacancy and your long-term plans. That's often where buyers find a second opinion most valuable.
Over time, that's also why we decided to work with agents who shared the same data-driven and advisory-led approach behind our editorial, consultants who could help readers think through decisions more objectively, rather than simply push transactions.
Today, the team has worked with more than 2,000 clients across over $5B in property transactions.
HDB rental rules – Rental Elibility
Probably the most important and basic criteria to begin with, but please determine your rental eligbility from the beginning. To help you with that, we have a full guide done up on how to see if you are able to rent out your HDB flat. After that, you will have to obtain a written approval by submitting your online application.
Landlord responsibilities
As a landlord, you will have to be responsible for the tenant. Do not get comfortable and think of all the monthly income you are going to receive! Remember that you are responsible for any infringements that your tenants might cause. Here are some of the things you have to take note of:
- Ensure your tenant e-Stamps the rental agreement
- Only authorised tenants are allowed to stay in the flat
- Number of tenants is capped to the limit (based on the size of the flat)
- Tenants do not further rent out the flat to others
- Tenants do not create nuisance or misuse the flat (for illegal activities)
- Tenants must be legally residing in Singapore
- Tenantst must comply with agreements in the lease and the provisions of the Housing & Development Act
Do I have to pay Property Tax?
As the Government’s main aim is to encourage home ownership, property tax is higher if you do rent out your HDB. Do not forget to include this additional tax when making any calculations, particularly if you need the rental income to offset your mortgage payments.
Subletting the whole flat
If you are subletting the whole flat, there will be a higher property tax incurred. So you will not enjoy owner-occupier tax rates and will now be taxed at the residential tax rate of 10%. If the lease has landed you do not have to inform IRAS if you intend to continue renting it out. Of course if you are intending to stay back at your home again do not forget to apply for the lower owner-accupier tax rates when you move back in!
Subletting rooms
If you are just subletting some of your rooms out, the upside here is that you will still be paying owner-occupier tax rates. Just ensure that on the rental agreement it is stamped as “partially let” instead of “wholly let” to enjoy the lower owner-occupier tax rates!
As always, feel free to reach out to us at stories@stackedhomes.com or leave a comment down below!
Yield tables and rent charts are useful reference points, but the units that actually rent well through a cycle, after vacancy, holding costs, and your intended exit, aren’t always the ones at the top of the list.
If you’d like to discuss how this applies to your own circumstances, you can reach out for a one-to-one consultation here.
And if you simply have a question or want to share a thought, feel free to write to us at stories@stackedhomes.com. We read every message.
Frequently asked questions
What are the basic requirements to rent out an HDB flat in Singapore?
What responsibilities do HDB landlords have when renting out their flats?
Do I have to pay property tax if I rent out my HDB flat?
What are the rules for subletting my entire HDB flat?
Can I sublet just a part of my HDB flat and still pay lower taxes?
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