Previously non-Malaysian tenants of HDB flats could only sign leases up to a maximum of 1 and 1 half years. Starting 1st of January 2019, they will be able to sign leases of up to 2 years.
143 Mei Ling Street, Queensway. Picture: iProperty
Will revised tenancy period for non-Malaysian tenants of HDB flats boost rental market?
Singaporeans and Malaysians are allowed to rent HDB flats for a maximum of 3 years time. But in March 2013, the tenancy period for non-Malaysian tenants was cut to one and a half years to prevent foreign enclaves.
While the minimum rental period for HDB flats remain at 6 months, the maximum will now be extended to 2 years for all applications received from Jan 1 next year.
Some call this move a long time coming as it will make it easier for landlords, tenants and also the Housing Board (HDB) since renewals can be done less frequently.
Agents who handle flat rentals may also benefit as their commissions are more easily pegged to a 2-year tenancy period. Usually, when an agent helps seal a deal for a 2-year tenancy period, their commission works out to be the rent for about for 1 month.
Some tenants and analysts are however sceptical about how much this change will affect of help the softening rental market.
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43,000 HDB flats tenanted to foreigners less than 4% of HDB stock
Bukit Batok West Avenue 2. Picture: iProperty
The HDB rental market has been softening with November’s rental prices 15.8% lower than the peak in August 2013.
Will this move boost the rental market?
Perhaps not immediately and for as long as the restrictions on immigration and foreigners registered as tenants within an HDB block remain. The market is swung to the tenants’ side of the court for the moment as the rental options available are growing.
There is no maximum period for tenants in private residences though short-stays shorter than 3 months are not allowed.
Analysts say that tenants are now less likely to lock themselves into longer lease periods. This move may, however, help some foreigners who have passes for 2 years.
The one-and-a-half year tenancy period may be just shy of their work period here and this will save them the hassle of having to find a place to live for 6 months or less.
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