Housing in Singapore

OVERVIEW

With available land space becoming increasingly scarce as development continues, real estate in Singapore is not known to be cheap. However, with everything from affordable public housing developed by the state to multi-million dollar private mansions located in exclusive postcodes reserved for the rich and famous, Singapore does have a wide range of housing options to suit different budgets.

Locations closer to the city center or those with a higher concentration of private developments generally have a higher price than neighborhoods further from the city center. Most neighborhoods in Singapore are designed to be “self-sustaining”, with multiple supermarkets or local grocery shops to provide you with your everyday amenities, one or more large shopping malls for a variety of retail, service and dining options, medical clinics, places of worship, and primary/secondary/tertiary schools serviced by multiple public transportation lines (train and bus). That being said, the island itself is not large and with its excellent transportation networks (or with the convenience of a car), nothing is ever too far away.

RENTING IN SINGAPORE

Taking the plunge to move to sunny Singapore? Great – now it’s time to sort out your accommodation. While buying in Singapore may be more of a challenge for foreigners, it is relatively easy for expatriates to rent properties. A variety of local HDB (Housing Development Board) flats, single rooms in apartments, private condominiums, and even landed property (terraces/bungalows) are available for you to choose from.

There are a couple of ways to begin your property search in Singapore: you could adopt a gung-ho approach and source properties by yourself using property websites, bulletin boards, and newspaper listings, or you can engage the services of a local property agent.

The latter approach is the recommended option. While you may incur fees by engaging what’s called a Tenant Agent (it’s usually 50% of one month’s rent), it is thoroughly helpful to have someone who understands the ins and outs of the industry, the rules and regulations of the country (and there are quite a few in Singapore), and who will be acting in your best interests and saving you from unnecessary hassle. Should you choose to engage a Tenant Agent to assist you, be sure to look up agents belonging to reputable real estate organisations such as Huttons, ERA, and PropNex, to guarantee the quality of service.

A few points to take note in the process of your house hunt:

1. The standard lease term in Singapore is 1 year and most landlords don’t accept leases of less than a year. Leases may come with or without options to renew and landlords will usually require 2-3 months’ notice should you choose to renew your lease.
    
2. Once you have found a property you want to rent, a Letter of Intent (LOI) will be drawn up proposing your intention to lease and includes your requirements to the landlord. If you hired the services of a Tenant Agent, they will prepare the document for you. As properties may come fully or partially furnished, ensure that all your requirements are stated in this document (e.g. additional furnishings required such as a bed or sofa, etc.), as the landlord will be bound by these terms once he/she signs the LOI.
    
3. As an expatriate you should include a Diplomatic or Repatriation Clause in the LOI (and Tenancy Agreement) to safeguard you in the event that you are no longer employed or are transferred to another country. If you have a lease longer than 12 months (i.e. 24 or 36 months), this clause gives you the right to terminate the lease after the first year of the lease by giving 2 months’ notice (terms may vary), and the landlord will have to return the security deposit to you. Landlords do not usually include this clause for tenancy agreements lasting 12 months or less.
    
4. A booking deposit (usually an amount equal to one month’s rent) will be collected by the landlord at the signing of the LOI. Once the landlord signs the LOI and accepts the deposit, he/she is not permitted to let the property to other tenants. This booking deposit will then form part of the security deposit or advance rent after the Tenancy Agreement is signed.
    
5. The amount of the security deposit is usually stated on the LOI and will be collected upon signing of the Tenancy Agreement. The standard amount for the security deposit is one month’s rent for every year of lease. When your lease ends, the security deposit will be returned without interest. Note that the landlord has the right to deduct costs and expenses from the security deposit should there be any breach of terms stated in the Tenancy Agreement.
    
6. After the LOI is signed, a Tenancy Agreement will be drawn up by the landlord. Tenants may be required to incur the cost of legal bills for preparation of the Tenancy Agreement. An advance of 1 month’s rent is usually collected along with the security deposit at the signing of the Tenancy Agreement. Tenants will have to incur the installation charges and monthly bills for utilities (i.e. gas, water, electricity, cable TV, etc.), be responsible for minor repairs in the leased property, as well as take up service contracts for air conditioning, gardening, pest control and pool maintenance/servicing. Be sure to check over the Tenancy Agreement before signing on the dotted line as the Singapore government tends to favour landlords over tenants.
    
7. Tenancy Agreements have to be stamped by the Inland Revenue Authority of Singapore to validate the contract as an official legal document. The stamp duty for this process is usually borne by the tenant. You can calculate your stamp duty on the IRAS website ( https://www.iras.gov.sg/IRASHome/Other-Taxes/Stamp-Duty-for-Property/).
    
8. Prior to or on the day of handover, the landlord should provide an Inventory & Defects checklist detailing all appliances and furnishings provided with the rental, as well as any present defects in the property. If there are unsatisfactory aspects to the property, be sure to note it down in the checklist (you can take photos for more assurance as well). This list will help minimize any disputes on your security deposit when it comes time to leave.

WHAT YOU’LL NEED TO RENT A PLACE IN SINGAPORE

Once you have decided on a property to rent, you will need to prepare following documents:

• Copy of passport
• Copy of employment papers and permit
• Booking deposit (usually 1 month’s rent)
• Security deposit (usually 1 month’s rent per year of rental contract)
• Advance rental (usually 1 month’s rent)
• Stamp duty

Following that, your agent (if you used a Tenant Agent in your search) or the Landlord’s Agent will draw up a Letter of Intent and Tenancy Agreement that will have to be completed and endorsed before the rental is official.

BUYING IN SINGAPORE

The Singapore housing system was designed to enable Singapore citizens to be home owners, and for housing to remain affordable for its citizens in changing times such that all citizens have a stake in their country. With finite land resources in the city-state, the government has been highly involved in the property market, imposing rules and regulations that limits foreign ownership of property in Singapore. As a foreigner, the types of residential properties available to you for sale in Singapore are limited, however there are still many opportunities to purchase and own properties.   

Here is a list of the types of residential properties in Singapore and their general terms of purchase and ownership for foreigners:
 

Property Type	Description	Purchase/Ownership Terms
HDB	Public housing estates developed by the Housing & Development Board of Singapore.	Restricted – foreigners are not permitted to purchase and own HDB properties.
Executive Condominiums (EC)	Also known as HDB Executive Condos, ECs are a hybrid of public housing estates developed and sold by private developers) that combines elements of public and private housing. ECs are subsidized, and thus priced more attractively than private condominiums.	Restricted – foreigners may only purchase Executive Condominium properties 10 years after the building is completed.
Private Apartments & Condominiums	Modern high-rise estates developed and sold by private developers.	Non-restricted – foreigners may purchase and own private apartments & condominiums.
Landed House	Terraced houses, semi-detached houses, bungalows.	Restricted – foreigners may apply to the Singapore government to seek approval for purchase of landed property.

 

Should you have your eyes set on a restricted residential property, fret not. While this segment of the market is designed to be barred to foreigners, the Singaporean government has reserved windows of possibilities for foreigners who are Permanent Residents of Singapore, or who have made “adequate economic contributions” to Singaporean society. 

As with anyone buying property in a foreign land, it is highly recommended to work with a real estate agent and real estate lawyer to ensure the process is as seamless as possible. The typical process involves signing an Option to Purchase (which includes a payment of 1-5% of the property value to the seller to reserve the property as a buyer), and exercising the option by entering into a Sales & Purchase Agreement between the buyer and seller, which also involves putting down a deposit and setting deadlines for future payments and fees.

HELPFUL REAL ESTATE WEBSITES

Property Guru ( http://www.propertyguru.com.sg) – Singapore’s largest real estate listing website includes both residential and commercial properties for sale and rent. The site offers a Q&A forum where property agents will answer questions, as well as other features such as a mortgage calculator, stamp duty calculator, property price and valuation tools, and property guides, to try and ease the hassle on the hunt for your dream property. Property Guru is also available on iOS and Android applications.

99.co ( https://www.99.co) – 99.co conveniently segments your property search by district and area (as most sites will do), but interestingly also by HDB Towns, MRT stations, and by schools (limited largely to local primary schools). With a focus on residential properties for sale and rent, you’ll get a more curated selection as compared to sites that offer both residential and commercial properties. With a user-friendly interface, 99.co is also available on iOS and Android applications.

ST Property ( http://www.stproperty.sg) – ST Property offers listings of both local and overseas properties for sale and rent. For local properties, the site allows you to further segment your search by properties for sale, for rent, or even just a room rental (great for international students or singles looking to share a flat). ST Property also offers analytics delivering insights and trends into the property market in Singapore, as well as financing tools, property tax calculators, and even “Feng Shui” guides.