Advice on housing agent required for rental of HDB flat

[ladylenn]

Hi all,

I would like to seek some advice. I am going overseas for two years for job purposes and would like to rent out my 2 year old HDB flat. Note: Approval from HDB will be obtained before renting out my unit.

I have researched much on the rental process in Singapore but am still pretty confused and have some questions:
- Is housing agent necessary or can I DIY? The market rate now is 1 month commission for agent yes? I'm afraid that I may miss out on certain matters if I opt to go through the rental process myself. Given that I'm overseas, one of my family member will act as POA in all matters relating to my HDB flat.
- Is it a must to inform my tenant that I am overseas for the entire period? I'm afraid they will thrash my flat.. I am not saying that ALL tenants are bad as I very well know that there are both good and bad eggs for both tenants and landlords. If not for my current situation where I need to finance the high mortgage amount, I would not have bear to rent out my almost new flat.
- Does the housing agent role end once tenant is found for my unit? Do I have to go through the agent for any subsequent matters (end of lease period etc) with my tenant?
- I read this article that spot checks and photos of my flat should be done every half a year. Is that even possible? It does not seem very appropriate to get my family member to appear at my unit and start taking photos?
- Could anyone share with me the rental process starting from the point where my advertisement is posted online/newspapers.
- Any tips on how to shortlist a reasonably decent tenant?

Thank you!

 

[Meemoosaa]

- Is housing agent necessary or can I DIY? The market rate now is 1 month commission for agent yes? I'm afraid that I may miss out on certain matters if I opt to go through the rental process myself. Given that I'm overseas, one of my family member will act as POA in all matters relating to my HDB flat.

It is entirely possible to DIY and I know people who are in a similar situation as yourself and has gone DIY for renting their whole house out. It is important to have a trusted family member to overlook the tenant and rental payment while you are away though. What you need is a drafted tenancy agreement and also file for a rental certificate of stamp duty with IRAS.

- Is it a must to inform my tenant that I am overseas for the entire period? I'm afraid they will thrash my flat.. I am not saying that ALL tenants are bad as I very well know that there are both good and bad eggs for both tenants and landlords. If not for my current situation where I need to finance the high mortgage amount, I would not have bear to rent out my almost new flat.

You may inform them but also let them know that a trusted family member has been given the authority to overlook the tenancy and will tend to immediate or emergency matters. If I'm a tenant paying rent, I would also want to know how to reach out to my landlord or the next best person for assistance.

- Does the housing agent role end once tenant is found for my unit? Do I have to go through the agent for any subsequent matters (end of lease period etc) with my tenant?

I believe the agent fee you pay for initially is just for finding a tenant and for sorting out the tenancy agreement. If you require extra overseeing, this may require additional monthly agent fee. Try and speak to one to see what they say. I'm not in a position to advise on this.

- I read this article that spot checks and photos of my flat should be done every half a year. Is that even possible? It does not seem very appropriate to get my family member to appear at my unit and start taking photos?

Take photos of all your flat area before renting and email them to your tenants as a mutual acknowledgement that there are no damages or with acknowledged damages. With email, there will be a paper trail and record of what's damage and what's not damage before the rental start.

You may come to some kind of agreement with the tenant in writing that you need to do a spot check once every 6 months just to make sure things are not being damaged. Or you can limit your rental agreement to just 1 year and will only renew upon inspection of the flat. (Stick to just 1 year contract if you are new to this)

Yes - it's not appropriate to have someone to just turn up my rental unit every now and again to take photos and spot check. However, all these can be discussed and agree beforehand to avoid any awkward situation.

Don't forget that while you may be the homeowner, the tenant is also basically a paying customer.

Also - you need to put aside any emotions and sentiments you have for your flat if you want to be a proper landlord. The moment you rent it to someone, it becomes a business transaction, the flat is a commodity and no longer a home for you.

A relative also had to rent out her whole unit recently. She got so emotional and upset to have to see someone move into her "home" and keeps worrying every minute that the tenant might destroy her house. But when the money rolls in monthly, it was easier to "let go".

Could anyone share with me the rental process starting from the point where my advertisement is posted online/newspapers.
- Any tips on how to shortlist a reasonably decent tenant?

Classified ad, gumtree, craiglist etc... Just do a google.

Best is to rent it to dinks (Double Income No Kids) with professional jobs. They are out of the house working most of the time and steady monthly wages means steady monthly rental for you.

If not, small family with one kid is not too bad too.

People I won't be renting the whole house to:

Students (no experience of managing the whole house)
All guys gang / brothers (most guys don't bother to upkeep the place neatly and tidy)
Family with more than 1 kid (too many children = messy and no time to upkeep the place)

Good luck !

 

[therat]

Best is to rent it to dinks (Double Income No Kids) with professional jobs. They are out of the house working most of the time and steady monthly wages means steady monthly rental for you.

I rented to this dinks (as you mention) before.
Yes.. they are out of house working. due to that.. they never had time to clear the house, wash the toilet.
after 2 yrs, toilet cover with yellow stink.
As they are so busy working, they don't have time to sweep the floor and don't mention mopping..
To solve that, they wear slipper all day long.

The ceiling light down.. as they are so busy working... they just transfer one ceiling light from the room to living hall.

Basically.. nightmare after 2 yrs

The only good thing is.. they paid rental ontime..

 

[tk]

usually is the landlord responsible for fixing spoilt things like replacement of lightbulbs, choked drainage, leaking wc and taps, built-in cabinet doors etc...?

 

[Meemoosaa]

I rented to this dinks (as you mention) before.
Yes.. they are out of house working. due to that.. they never had time to clear the house, wash the toilet.
after 2 yrs, toilet cover with yellow stink.
As they are so busy working, they don't have time to sweep the floor and don't mention mopping..
To solve that, they wear slipper all day long.

The ceiling light down.. as they are so busy working... they just transfer one ceiling light from the room to living hall.

Basically.. nightmare after 2 yrs

The only good thing is.. they paid rental ontime..

Sorry to hear about your unpleasant experiences.

I think luck plays a part too when comes to finding good tenants. I remembered an aunt who rented the whole place to 2 Singaporean girls thinking that there shouldn't be any problems with girls. Ended up they damaged a lot of stuff and even broke the bed. Nightmare for her too. She now rents it to a foreign family with one kid, wife stays at home as a housewife, seems like it worked out better this way.

 

[Meemoosaa]

usually is the landlord responsible for fixing spoilt things like replacement of lightbulbs, choked drainage, leaking wc and taps, built-in cabinet doors etc...?

If it's room rental - yes to all the above. (at least in my own experiences)

But if the whole house rental - I think you need to sort out most minor issues yourself such as lightbulbs or loose cabinet doors. Choked drainage and leaking WC and taps is likely to be taken care by by the landlord as they are more of permanent structure.

Again - it depends on how accomodating your landlord/tenant is. Best is to trash it all out on writing beforehand.

If it's first time renting out, best to use an agent. Subsequent years later, you can DIY yourself with some experiences.

 

[ladylenn]

meemoosaa: Thank you so much for ur advice! Especially on the advice on the emotions which I have to sort it out myself.

I have recommendation from my friends for housing agent. I am not sure how good he is though and I have not formally engaged him. The commission is only paid when a tenant is found? Otherwise, I may look elsewhere if I do not find the agent suitable?

 

[Meemoosaa]

meemoosaa: Thank you so much for ur advice! Especially on the advice on the emotions which I have to sort it out myself.

I have recommendation from my friends for housing agent. I am not sure how good he is though and I have not formally engaged him. The commission is only paid when a tenant is found? Otherwise, I may look elsewhere if I do not find the agent suitable?

If you are new to this, I think it's best to engage an agent first to sort out the first year. You can then DIY in the subsequent years when you will have gotten hold of a tenancy agreement and also understand how to file the certificate of stamp duty with IRAS.

Yes - commission is only paid when a tenant is found. That's what the fees are for.. for their work in searching the tenant for you. By the way, the purpose of using an agent is so that you don't have to do the hard work yourself. You can state the kind of tenants that you want to specifically avoid and prefer. If not the agent will just about bring anyone who is interested to come do the viewing and it'll be a waste of your time.

I had a colleague who was looking for a room to rent, despite specifically telling the agent the kind of room/location she is looking for the agent still took her to like 20 over locations. Most of them were not even near what she asked for. It was a waste of her time and she vowed she'll do it DIY the next time she moves. So make sure you specify what you want and require to the agent to follow suit.

I don't remember what the commission is for a whole house rental but for rooms - it's usually half a month for 1 year contract, and a full month's rental worth for 2 years contract. But if you are doing this for the first time, I would say start with just 1 year first to see how things goes and you can always renew the contract with the tenant after a year.

What sort of unit are you renting out btw ?

 

[ladylenn]

Yup I prefer to engage a housing agent given that I'm leaving soon and I do want to make sure that all the relevant paperwork is done.

I have initiated a meetup first with the agent but he does not seem keen as I have yet to obtain actual HDB approval (due to some delays). I am also not sure how this process works as I only have friends/colleagues who are the tenants. I was wondering if during the search process, should I find the housing agent not exactly suitable to my requirements, can I look for another agent.

My unit is a premium 4 room HDB, fully furnished condition.
Thanks!

 

[SpeedWeed]

Hi! I rented out my HDB through an agent but this year decided to stop seeking services from my agent. I believe that if I were to rent out, I need to apply and let HDB know that I will be subletting right? I have already made an application and it will expire in Jun 2015.

I will be renewing the lease with my tenant in Oct 2014 which is when the old rental agreement expires. Therefore, do I make a new application with HDB on Jun 2015 or now? Thanks!!!

depending on the lease agreement you signed.

there are stipulations in the contract whether you are liable to pay commision for renewal.

easiest way for u is to call the hdb branch office to clarify