Procedure & Documentation In A Rental Transaction

A. The Renting / Leasing Process:

Inorder to provide better service and to be more efficient and effective, we need to know your needs and requirements.

1. Your Comfortable Range of Allocated Sum For Leasing Your Desired Lodging ?.

This should be within a $500-$1000 difference in range i.e between $3500-$4000 or $4000-$5000

Budgeting yourself will also evaluate the location and size areas of the apartments or houses that are suitable for you

Generally, it is advisable for new expatriate families to start out in a condominium as it provides a household spouse a readymade communal network to rely on for support. The added security is also a plus point to consider as well as the facilities inside the condominium.


2. Size & Number of Rooms ?

Our Singapore Local Terminology, e.g 3+1 means 3 Bedrooms plus a small maid/utility room and not 4 Bedrooms. (However it is different in the case of HDB flats where 3 Bedrooms only comes with 2 Bedrooms, to find out more details for HDB layout, pls visit the Housing Development Board (HDB) website @ http://www.hdb.gov.sg)


3. Location ?

Deciding on the right location is very important and it will determine the convenience for you and your family.


4. Fully or Partially Furnished or Unfurnished ?

a. Partially Furnished - units usually comes with all fixtures, i.e lights, air-conditioning, curtains, built-wardrobes, kitchen cabinets, cooker hob, cooker hood, refrigerator, washer, oven and sometimes with optional items such as mircowave oven, dryer and dishwasher etc. Basically items inside the Kitchen and Laundry Area.

b. Fully Furnished - units have all items found in partially furnished units, and with additional items like bedroom sets, lounge set and dinning set, TV, etc. To put it "in-a-nutshell", basically you just need to move in with your suitcase.

c. Unfurnished - a bare and empty unit. Usually New Project, with only Hood and Hob, Lightings.


5. Commencement Date ?

No point we show you the properties that are still tenanted and is available only 1-2 months later, if you require an immediate occupation unit. Or in another scenario we show you an already vacant unit, but you only require them 2-3 months later. Some owners will not hold the unit for you, especially in this booming period, as supply are limited


6. Term of Lease / Tenure ?

This refers to the length of the lease from commencement to demise. Lease usually range from 12 to 24 months (1 to 2 years), with or withour an option to renew for another 12 months to 24 months. For Renewal of Lease, Landlord usually require you to give a 2 or 3 months’ advance notice of your intention.

Most landlords will not accept leases that are less than 1 year. However Short lease like 1-3 months do available, but usually comes with a price or the unit might have the intention of selling vacant, Owners moves back for own stay, or the project is En Bloc which is very common during this En Bloc Frenzy Period, in other words, you do not have the option of renewing the lease if it is the latter case.

In Singapore, the standard lease period is more than 1 year, with or without an option to renew the lease. The lease renewal is usually for another 1 to 2 years. For the lease renewal option, the landlord would normally require that you give

7. Company (Corporate) or Personal Lease ?

Company Lease - Signed under the Company's Name with the Company ROC's Number (Registry of Company) stating the name of the occupier/occupiers listed in the Tenancy Agreement (TA)

Personal Lease - The occupier in this case is also the actual signatory of the TA

*Most Landlords prefer corporate lease as it is harder for a company to break a lease without answering to the legal consequences but personal lease are becoming more acceptable nowadays.


B. Procedure & Documentation In A Rental Transaction

After you have decided to rent your ideal property and you will need to prepare the following:

- Photocopied passport
- Photocopied employment pass
- One month’s rental for the good faith deposit

Your agent will then prepare the necessary documents for you such as the Letter of Intent and Tenancy Agreement.

1. Letter of Intent

The Letter of Intent, LOI for short, is a letter proposing your intention to lease the property. It will also state your requirements to the landlord. You should take note of the following:

a. Diplomatic Clause
This clause is to safe-guard you in the event that your employment is ceased or you are transferred to another country such that you can terminate the lease after 12 months by giving 2 months notice. Thereafter, the security deposit will be refunded to you. Please note that most landlords will only include the diplomatic clause if the lease is more than a year.


2. Good faith Deposit
This is the booking deposit; usually the amount is one month’s rent. After the landlord signed the Letter of Intent and accept this deposit, he cannot rent the property to other party. This deposit will become part of the security deposit or advance rental after the Tenancy Agreement is signed.


3. Security Deposit
The amount of the security deposit is usually stated in the Letter or Intent. The standard practice in Singapore is usually one month’s rent for every year of lease. It will only be payable upon signing of the Tenancy Agreement. When the lease term ends, the deposit will be refunded without interest. However, the landlord reserves the right to deduct from the deposit all costs and expenses arising from the tenant for breaching any of the covenants stated in the Tenancy Agreement.

4. Your Requirements

Ensure that all your requirements and requests are clearly stated in the Letter of Intent. For example, such as requesting a new sofa, new bed or new washing machine etc. After the landlord had signed the Letter of Intent, he is bound by the Letter to provide you the requests.


5. Tenancy Agreement

After the Letter of intent is duly signed, the landlord’s agent will prepare the Tenancy Agreement. Any legal fees incurred for the drawing up of the agreement is usually borne by the tenant. However, if the landlord’s agreement is acceptable, there will usually not be any legal fees involved. You will need to prepare the rest of the security deposit and advance rental upon signing of the Tenancy Agreement.
- For 1 year lease - 1 month’s deposit and 1 month’s advance rental.
- For 2 years lease - 2 month’s deposit and 1 month’s advance rental.


6. Stamp Duty

Tenants are required to do the stamping of TA. Submit the TAs for e-stamping once the Landlord has signed.

Formula : - Rounded up to the next whole $

(Annual Rental/250) x 1 or 2 or 4 (*Depending on Lease Period) + $2 (Duplicate Copy - 1 for Owner, 1 for Tenant)

*For Lease of 1 yr or Less - Multiply by 1
For Lease of 1 yr to 3 yrs - Multiply by 2
For Lease of more than 3 yrs - Multiply by 4

e.g A mothly rental of $5000 for a period of 2 years

[($5000 x 12) / 250] x 2 + $2 = $482 Stamp Duty


7. Agent's Professional Fee

Rental for All Types of Properties including HDB Flats and Rooms)
-Landlord : Minimum One Month’s Gross Rental as Professional Fees for Lease up to 24 months

-Tenant : Minimum One Month’s Gross Rental as Professional Fees for Lease up to 24 months

(P.S : For Private Property, Monthly Rental above $2500, Tenant are not require to pay the agent's fee, however a token of appreciation may be given instead if you find the agents's service satisfactory.)


8. With The LOI or TA signed by the Landlord, the tenant can appply for utilities, Cable Vision and telephone line, etc.

Individual Tenants can apply online at http://www.spower.com.sg or http://services.spservices.sg/ Require FIN (Employment Pass or Work Permit No.)

Corporate Tenants have to apply via hardcopy at Singapore Power Building (Next to Somerset MRT Station). Requires Company ROC Cert, Photocopy of NRIC of person in charge (the signatory for the TA)


9. Taking Over the Property

The landlord will prepare an Inventory List on or before the day of handing over. Check the items listed in the inventory. Check all electrical appliances, air-con, lightings, water heater etc. If there is anything unsatisfactory, do not panic; note it down on the inventory. Even brand new houses have defects, therefore be understanding and allow the landlord to rectify it within a reasonable period.