You may have signed a tenancy agreement, and gotten keys to the flat, but if your landlord’s flat were not even eligible for rent to begin with, you’ll be nothing more than an illegal squatter in someone else’s home, at risk of immediate eviction should HDB find out.
That’s why it’s not enough as a tenant to only know the laws regarding tenancy. Learn the laws for landlords, too, so that you can ensure your landlord is following them, and spot a red flag when you see one.
What Determines HDB Rental Eligibility?
To rent out his flat, the landlord has to first apply for approval from HDB; if all the eligibility criteria mentioned below are met, he should have no problems getting the approval. The easiest way to confirm that your tenancy is not flouting any laws is to ask to view the landlord’s approval document from HDB before signing the lease.
Upon applying for approval to rent out the flat, the landlord will also be prompted to provide the particulars of his tenant. Once the rental has been approved, HDB’s system will register the tenant as an authorised tenant within two days. Always ensure that the flat owners have done due diligence for you and submitted your particulars to HDB, because unauthorised tenants may face immediate eviction. To check if you are recognised as the authorised tenant of a flat, simply verify at HDB’s “Enquiry on Authorised Tenants” e-Service.
Only Singapore citizens are allowed to rent out entire HDB flats; permanent residents are only allowed to rent out bedrooms in their flats, not the whole property. Foreigners are not allowed to buy HDB flats, much less rent it out, unless they have a spouse who is a Singapore citizen. So if both your landlord and his/her spouse appear foreign, something’s very wrong.
Whether you are renting the whole flat or just a single bedroom, always ensure that the person you are dealing with is the actual owner of the flat. The landlord should not find it out of place if you request for his ownership documents before signing the lease.
HDB Minimum Occupation Period (MOP)
The minimum occupation period is the number of years a homeowner has to physically occupy a property before he is legally allowed to lease it or sell it. It’s the means by which HDB dampens buying speculations. A homeowner who has not fulfilled the MOP is not allowed to rent out his entire flat, but may rent out bedrooms within the flat.
For the most part, most types of HDB flats – whether they are under the Design, Build, and Sell Scheme (DBSS), Build-to-Order (BTO), or resale – have MOPs of five years. There are a few exceptions, of course, and they concern certain types and sizes of resale flats purchased on the open market without CPF Housing Grant.
Type of resale flat purchased on the open market without CPF Housing Grant.
Resale flats bigger than one-room with a flat application date falling between 5 March and 29 August 2010.
Resale flats bigger than one-room with a flat application date falling before 5 March 2010.
2.5 years if purchased with a HDB loan, and one year without a HDB loan.
To ensure a good mix among residents, HDB monitors the ratio of foreigners to citizens living in HDB-built properties. Only eight per cent of the entire neighbourhood and 11 per cent of the entire building may be occupied by non-citizen residents – and this includes non-citizens who have permanent residency. Malaysian non-citizens, however, are not included in the calculation of the quota, since they are considered historically and culturally similar to Singaporeans.
In short, if eight per cent of the neighbourhood’s residents, or 11 per cent of the block’s occupants are already foreign, homeowners are only allowed to rent out their flats to Singapore citizens or Malaysians.
The good news is, the quota is only applicable to the rental of whole flats, not single bedrooms. This means that a homeowner interested in renting out just a single bedroom could successfully get permission from HDB to do so no matter the percentage of foreigners already residing in the neighbourhood or block.
Red Flags to Watch Out For
Even if your landlord’s eligibility checks out, the rules may still be flouted during your tenancy. Always be on the lookout for the red flags mentioned below to ensure that you do not inadvertently become a part of something illegal.
Whether it’s the entire flat that’s being rented out, or just a bedroom, HDB allows only one layer of leasing. This means that the owner is allowed to rent out his property or bedroom to a tenant, but the tenant is not allowed to further sublet the flat or bedroom to yet another tenant.
That’s why it’s important to ensure that the person you are dealing with is actually the owner of the property. Should the owner be overseas or unavailable during the period of your tenancy, he should appoint an attorney to manage the property. This attorney should possess a certified Power of Attorney form, and must not already be a tenant of the flat.
If the flat you are a tenant of starts looking a little crowded, you may want to do everyone a favour and remove yourself from the equation. HDB has limits on the maximum number of occupants allowed in each flat, and overcrowding is a good indication that rules are being flouted.
Four-room and bigger
Never agree to live in a room made out of partitions; only bedrooms originally built by HDB can be legally rented. In addition, it is illegal for homeowners to get approval from HDB to rent out a single bedroom, but not reside in the flat themselves. So if you were renting only a bedroom and never see your landlord at home, the rules are not being followed.
Unusual Leasing Periods
The minimum leasing period allowed is six months, and the maximum for Singaporeans or Malaysian tenants is three years. For non-citizens who are not Malaysians, the maximum leasing period is 1.5 years. These rules hold true whether it is the whole flat that’s rented out, or a single bedroom, so if your lease is flexible enough to rival an Airbnb property, it’s definitely too good to be true.