There are many reasons one can decide to relocate to Singapore. The country has multiple job opportunities and quite a lot to offer. However, before you think of moving, you have to handle something major, and that is your residence. Naturally, you will have to arrange for your accommodations.
The thing is, even if you are really well off financially, it’s not going to be easy for a foreigner to purchase a property in Singapore. Even those who become Singaporean permanent residents have to abide by certain rules and restrictions with regard to the properties they are allowed to buy. Yes, foreigners can purchase properties as per the Residential Property Act. But there are many limitations.
This is primarily why most foreigners prefer to rent real estate in Singapore. This is a somewhat more convenient option that protects them from unnecessary hassles. However, if you are not sure about how to proceed with the renting process, you might feel a bit lost or overwhelmed. So, it is vital to learn all there is to know about renting real estate as a foreigner in Singapore.
The Type of Properties Foreigners Can Rent in Singapore
Once you decide to rent a property in Singapore, you must realize that some rules are in place for foreigners. For one thing, you have to be clear about your options. In Singapore, foreigners have two primary options when it comes to renting properties. They can either rent a room in a shared apartment with other tenants or an entire apartment.
Typically, those who come to Singapore on their own for a job or studies prefer renting an apartment with their friends. This makes it easier than sharing communal places like the kitchen with total strangers. Let’s take a look at the type of properties you can expect to find in Singapore for renting.
Housing Development Board (HDB)
It is pretty well known that land scarcity is a major issue in Singapore. This is primarily why real estate in Singapore has gone through so many changes over the years. Finally, the government seems to have found the perfect solution, which is HDB – public housing, by the Housing Development Board.
Nearly 79% of apartments in Singapore are HDB, while the rest are landed properties and private condominiums. Therefore, naturally, if you want to rent an apartment in Singapore, HDB can be one of your options to consider.
There are some things you have to keep in mind if you intend to rent HDB as a foreigner:
- You have to rent the HDB flat or bedrooms for at least six months.
- The maximum rental period for non-Malaysian foreigners is two years.
- The maximum rental period for Malaysian citizens who live in Singapore as foreigners are three years.
The government intends to maintain an appropriate ethnic mix in HDB estates. Therefore, non-Malaysian foreigners are subjected to the non-citizen quota for renting out of flats.
Condominium
Another option for foreigners looking to rent real estate in Singapore is condominiums. These are private housing development equipped with many modern amenities like sports facilities, swimming pools, and so on. The best thing about renting a condominium is that there are no non-citizen quota restrictions implemented. For instance, Marina One Residences or Skyline Residences, are private condo that are located in the central of Singapore.
Note that executive condominiums must follow the laws of HDB for the first ten years and only get privatized status after the period has passed. In other words, you have to make sure that the executive condominium has met the minimum occupation period of five years before it is allowed to be rented out. This is something to keep in mind.
Landed Properties
You won’t find many landed properties in Singapore. Considering how small the proportion of landed properties is in Singapore, it’s not really surprising that the rental prices are incredibly high.
So only those foreigners who have ample budget and want spacious property can consider renting landed properties. You will find detached and semi-detached houses, terraced houses, and bungalows in this category.
Things To Consider While Renting Real Estate in Singapore
Yes, budget is one of the most vital factors that one has to consider while renting real estate in Singapore, especially if you are a foreigner. But there are some other things that need to pay heed to. Let’s take a look at what you should be thinking about when selecting a place to rent in Singapore.
Financial Planning
It is important to understand how to budget for the rental costs in renting a property in Singapore. Although it can be tempting to select a luxurious property to rent. But does your pocket have room for that?
You should decide on a rental budget beforehand so that you can look for a unit accordingly. For instance, those with a budget of $1500 cannot go looking for private property. This budget is only good enough to rent a master bedroom with an attached bathroom. Consider your income and living expenses while deciding the budget for your rent.
Lifestyle Requirements
Remember, like many other countries, in Singapore too, where tenants are not allowed to keep pets or smoke within the property. So, if you have any such requirements, these need to be highlighted to the representing agent beforehand or written in the letter of intent.
At the same time, if you rent a room in a shared apartment, you must find out more about the limitations on the use of common areas. In a lot of such shared apartments, many rules are implemented on the tenants, like restrictions on the use of the kitchen for meal preparation or the number of times that laundry can be done weekly. You can find all the details in the Tenancy Agreement.
Amount Of Space Required
You have to figure out how much space you need. For instance, if you are moving to Singapore with your family, you will need units of at least 1100 sq. ft. But if you are on your own, up to 600 sq. ft space will be enough for you. Make sure that the space you decide on will be enough to accommodate all your personal belongings.
Accessibility Of the Location
It is best to find a property that will make commuting to various locations easier for you. Remember that real estate close to MRT stations and malls will have higher rental rates. But you must think about your convenience too. Of course, there are top neighborhoods in Singapore that are more popular among foreigners that you may want to consider to explore.
Amenities To Consider
Naturally, some amenities and facilities make it worth spending a little extra on your rent. If your unit has a pool or gym included, make sure that the facilities are well-maintained.
It will also be beneficial to look for locations where supermarkets, banks and ATMs, and similar other places are nearby.
Length Of Lease
As we have already mentioned, the maximum lease for non-Malaysian foreigners is three years, while the minimum is six months for HDBs. For private properties, the minimum length of lease that landlord prefers will be at least one year. However, nowadays, two years lease is much preferred.
How To Look for Rental Properties as a Foreigner in Singapore
If you are new to Singapore, finding the right real estate to rent can be a challenge. You have three main options for this.
- Online property portals enable you to browse and filter listings using which you can reach out to the landlord or real estate agent.
- Word-of-mouth referral which can work if you have friends or colleagues in the area.
- Hiring a property agent who will not only help you look for the right property but will also handle all the paperwork.
Keep in mind that a property agent cannot represent both landlord and the tenant in Singapore.
Also Read: 7-key-benefits-of-engaging-a-real-estate-agent-to-find-your-rental-home-in-singapore
Documents Needed to Rent Real Estate in Singapore as a Foreigner
Naturally, you will want everything to proceed smoothly. No one likes to deal with legal hassles when they are trying to rent a property. To do this, you have to ensure that you have the required documentation at hand.
Remember that all the documentation you present should have a validity period of a minimum of six months to the date of application. Here is the list of documents you will need to prove that you are a legal resident of Singapore.
- Employment or Student Pass
- Work Permits
- Dependent Passes
- S Pass
- Long-Term Social Visit Passes
- Passport
Sometimes, you may not have a physical copy of your pass at the point of placing a deposit for the property that you intend to rent. So long you have a valid In-Principle Approval from our Immigration and Checkpoints Authority (ICA), you can still go ahead to place the deposit. Just remember to furnish the physical copy of your work or student pass to your representing agent or Landlords upon collection.
The Renting Process Foreigners Must Go Through in Singapore
Finally, once you have selected the property and finalized the budget, it’s time to get down to the actual thing, which is the rental process. Here is how to proceed.
The Letter of Intent
Once you have settled on the unit you like, you need to fill up a Letter of Intent. In this document, the information that needs to be filled in is as follows:
- Property address
- Proposed monthly rent
- Length of stay
- One month of booking deposit
- Your requirements
Diplomatic clause – This clause is important for you as a foreigner who is holding a work pass. This clause allows you to terminate the tenancy agreement prematurely if you need to deploy out of the country earlier than the lease expiry with proof of such intention from your company. The diplomatic clause enables you to take back your full security deposit held with the landlord, provided you have returned the property in a good condition (considering fair wear and tear). Else, the landlord still reserves the right to make good of the returned condition with the cost deducted from your security deposit.
However, you are still needed to pay back the pro-rated commission to the landlord whom he/she has paid the representing agent for this tenancy.
Commonly, a diplomatic clause can only be used after a minimum stay of twelve months with a two-month notice given to the Landlord. But there are still cases where you may have negotiated a different term on this clause with the Landlord. For instance, a minimum stay of ten months with a two months notice is given.
On the Letter of Intent, you will need to indicate the number of days for the Landlord to consider before this offer lapse. Two to three days of consideration is a common practice.
Once the landlord has accepted your offer, the next step will be to sign the Tenancy Agreement.
Sign The Tenancy Agreement
Make sure to read the tenancy agreement carefully before you sign on the dotted lines. You must be aware of all the terms and conditions and rules and regulations of the place you are going to rent. The tenancy agreement will have all the details about the property and transaction, including the payment of utility bills, mode of payment to the landlord, and so on. Once the tenancy agreement is signed by both parties, you have deemed to enter a legal agreement on the property rental.
The payment that you need to make upon signing the tenancy agreement:
1) Security Deposit
A security deposit is needed for renting a property. This amount will be used to fix any damage to the property during your stay or to recover the financial costs if you break your lease.
- For a six-month to one-year lease: One month of security deposit
- Two years lease: Two months of security deposit
2) One month of advance rental
One month of advance rental is payable upon signing the tenancy agreement. This covers the first month of rental once you move into the property.
3) Rental Stamp Duty
You must pay the stamp duty within fourteen days after the tenancy agreement is signed. Stamp duty is payable by the tenant. In Singapore, it is an offense not to stamp the tenancy agreement, and will not be admissible in court should disputes arise. In other words, stamping the agreement will legalize it and safeguard both the Landlord and tenant.
| Stamp Duty Calculation | |
| Monthly rental x Length of stay x 0.4% | |
| Monthly Rental | $3,000 |
| Length of stay | 24 months |
| Stamp duty payable | $3,000 x 24 x 0.4% = $288 |
| Admin Charge | $5 |
| Total amount payable | $288 + $5 = $293 |
4) Agency Fee to Your Representing Agent
Being a foreigner in Singapore, it is always good to have a real estate agent to help you find a rental property of your preference. You can ask for recommendations from your colleague or friends staying in Singapore. The responsibility of your agent includes helping you to find your preferred property and be there for assistance throughout the lease term.
Once the tenancy agreement is signed, you will need to pay your agent for the service rendered so far. The standard agency fee payable for all property types (except for room rental):
- One year lease: Half month of rental plus GST
- Two years lease: One month of rental plus GST
The most common way of doing real estate transactions in Singapore is using a cheque. It will be good if you can set up your checkable bank account during your first few days in Singapore. When you are ready to place a booking deposit for the property that you want to rent, you can do so with your cheque.
Of course, there will be times where it is rather cumbersome to get hold of your own cheque book when you reach Singapore as there are many other more important stuff that needs your attention. If you prefer, you can ask for a cheque from your friend if this is more convenient for you.
Time to Move In: Take Pictures of Everything
There is a warranty period of thirty days from the start of the tenancy agreement where the Landlord will pay for any item to be fixed within this warranty period.
Thereafter, the minor repair clause will kick in.
A minor repair clause of $200/- per item for example means that for any item that is not working and needs to be fixed, you will bear the first $200 of the repair. Any excess above $200, will be borne by the landlord.
For instance, the repair of the tap costs you $250. You will bear the $200 while the landlord will bear the remaining $50 of the repair cost.
However, before you get settled in your rented property, it is advisable to take pictures of the existing condition of the property. This will establish how the property is before you moved in and will help save your security deposit. After all, you will not want to pay for damages that are not caused by you.
Select The Right Real Estate Property to Rent!
There’s so much to consider when you are renting a property. It is vital to take your time to ensure you do not make an impulsive decision that you will soon regret. This is especially true if you are a foreigner.
After all, you are in a new land, and it will take some time to understand how things work. You will not want to find yourself with a lease that somehow binds you. So, make your decision after weighing all the relevant factors.
Of course, if you need some assistance in helping you find your preferred rental property, please contact us.
