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lease for HDB flat

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nanana
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lease for HDB flat

Postby nanana » Sun, 28 Jun 2015 9:17 am

Just wonder if there is a limit duration for the lease to rent HDB flat? say, minimum must be 1 year? I was told by the agent that the HDB set the rules that it can't be on flexible term? All along I thought it is based on the owner's term.

It is so different from Aust that once the lease expired, we can't force tenant to sign another contract. The tenants are allowed to continue to stay at the property on monthly basis and to give one month notice if they intend to vacate the property.

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Re: lease for HDB flat

Postby therat » Sun, 28 Jun 2015 10:00 am

nanana wrote:Just wonder if there is a limit duration for the lease to rent HDB flat? say, minimum must be 1 year? I was told by the agent that the HDB set the rules that it can't be on flexible term? All along I thought it is based on the owner's term.

HDB guideline is 6 months. But market practice is 1 or 2 years.

Code: Select all

It is so different from Aust that once the lease expired, we can't force tenant to sign another contract. The tenants are allowed to continue to stay at the property on monthly basis and to give one month notice if they intend to vacate the property.

Monthly basis is not allowed.
HDB minimum stay must be 6 mth

You might want to read this
http://www.hdb.gov.sg/fi10/fi10323p.nsf ... enDocument

Period of Subletting

Flat owners are not allowed to sublet the flat on a short term basis. The period of subletting to each subtenant per application must not be less than 6 months.

Maximum Subletting Period

The maximum subletting period allowed is 3 years per application or as indicated in the approval letter, whichever is shorter. However, for subletting involving non-Malaysian NC subtenants, the period of subletting per application is 1.5 years or as indicated in the approval letter, whichever is shorter. NCs refer to Singapore Permanent Residents and foreigners. You are required to apply each time you sublet your flat or when you renew the subletting tenancy.

Renewal fee
Flat owners must submit a new application and pay a fresh administrative fee to continue subletting the flat when existing subletting period expires. The new application will be subject to a reassessment of your eligibility to sublet your flat and the NC Subletting Quota.

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JR8
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Re: lease for HDB flat

Postby JR8 » Sun, 28 Jun 2015 11:14 am

nanana wrote:Just wonder if there is a limit duration for the lease to rent HDB flat? say, minimum must be 1 year? I was told by the agent that the HDB set the rules that it can't be on flexible term? All along I thought it is based on the owner's term.
It is so different from Aust that once the lease expired, we can't force tenant to sign another contract. The tenants are allowed to continue to stay at the property on monthly basis and to give one month notice if they intend to vacate the property.


The upper limit would seem to be the period during which the LL is permitted by HDB to let the unit. It is possible that the HDBs initial period of permission to let is renewed or extended [IIRC 5 years is the maximum permitted].
HDB probably state a minimum let/contract, simply so the contract falls within the statutory protections of the laws re: local Tenancy Agreements.
I have had an initial 2-year TA on a condo here in SG go 'month to month', or what is known as a Statutory Periodic Tenancy (SPT). I've also let flats in London that have gone 'periodic', some for several years on that basis. All the terms of the original TA automatically roll over into the SPT, except there is no minimum let period (like a 6-month break clause). The LL can still adjust the rent up and down with a simple memo agreed between the parties.
That works in the UK as you don't pay stamp duty on a TA, unless you rent a palace or something.
Also agents are not entitled to lettings commission beyond the initial term of the lease which is usually one year. [Since they're doing no additional work why should they be? - I understand that is the thinking].

But you can see re: these two points why they are rare here; and why agents will tell you such a thing is not possible:
a) You have to pay stamp duty on TA's here. Wishing to have to have the flexibility of an SPT on the basis that you might stay another 3, 6, or x? months makes paying the required stamp duty a little more complicated.
b) How does the agent calculate his ongoing commission if you've gone periodic? That's a bit complicated too, it requires time and work... so that might be why it's far easier to tell the tenant he can't do it!

--- in the case of HDB, I'd look at their policies and see if rolling onto an SPT in specifically disallowed. Note: You can only roll onto an SPT after an initial fixed-term TA has ended.

So going back to your para 1):
nanana wrote:Just wonder if there is a limit duration for the lease to rent HDB flat? say, minimum must be 1 year? I was told by the agent that the HDB set the rules that it can't be on flexible term?


1st part) But you would have already lived there a year before considering an SPT. Any SPT is not a new TA, it is simply a rolling extension of the original one.
2nd part) Well that sounds pretty black and white eh? So... the onus is on the agent to help you (since you're paying him) and send a link to, or quote the rule, that states that 'month-to-month', or SPT status is not permitted on HDB lets, and you can tell him you're asking as you know it's possible on condos here. Hmmm... my gut-feel is he won't be able to, and instead might just try and bull$ you further...

--- Something else to consider. Landlords here seem to rely on their agents more than elsewhere. So if an agent tells a tenant something is not possible, the agent will likely be saying the same to the landlord. You'd need the landlords permission (often via the agent, hence the problem you're facing) to go periodic. The landlord might simply take their agent's advice as best advice and not be open to discussing anything alternate.

--- Another route that provides flexibility... We're currently on a 4-month extension to our original 2-year TA. The extension was negotiated via the agents. Stamp duty was paid, as was the agent. I'd have preferred to greater flexibility of a monthly SPT but the above had - for obvious reasons - far more traction with the agent.
'Do it or do not do it: You will regret both' - Kierkegaard

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Re: RE: Re: lease for HDB flat

Postby ecureilx » Sun, 28 Jun 2015 1:40 pm

JR8 wrote:.

--- Another route that provides flexibility... We're currently on a 4-month extension to our original 2-year TA. The extension was negotiated via the agents. Stamp duty was paid, as was the agent. I'd have preferred to greater flexibility of a monthly SPT but the above had - for obvious reasons - far more traction with the agent.


The 1.5 year rule is set by HDB ...

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Re: RE: Re: lease for HDB flat

Postby JR8 » Sun, 28 Jun 2015 2:15 pm

ecureilx wrote:The 1.5 year rule is set by HDB ...


-----
'Period of Subletting
Flat owners are not allowed to sublet the flat on a short term basis. The period of subletting to each subtenant per application must not be less than 6 months.

Maximum Subletting Period
The maximum subletting period allowed is 3 years per application or as indicated in the approval letter, whichever is shorter. However, for subletting involving non-Malaysian NC subtenants, the period of subletting per application is 1.5 years or as indicated in the approval letter, whichever is shorter. NCs refer to Singapore Permanent Residents and foreigners. You are required to apply each time you sublet your flat or when you renew the subletting tenancy.'
-----

Anyone concerned with the above matters really has to read the following whole linked page (and/or if in future, however the policy concerned might have been updated over time).
http://www.hdb.gov.sg/fi10/fi10323p.nsf ... enDocument
'Do it or do not do it: You will regret both' - Kierkegaard


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