7 Ways to Avoid Singapore Landlord-Tenant Disputes, Arbitration and Everything in Between
Safeguarding the tenant’s interest to secure a rental in Singapore
Knowledge is power. This adage certainly applies to Singapore’s rental market. Renting a home in Singapore is about finding a fine balance between choices and affordability. Those familiar with the rules manage well without running afoul with the law, while newbie tenants face greater risks of getting knotted up in an arbitration clause, losing money or landing in the Small Tribunal Court (STC) over disputes.
As a first-timer or a seasoned ex-pat, you can find your suitable property agent via a Property Agent Directory. While most transactions between landlords and tenants are supposed to be amicable, they can infrequently become a bone of contention and a matter of dispute due to small differences or unreasonable asks.
Here are some tips that can help you get things right from the start, once you have zeroed in on a property based on size, price, location and neighbourhood.
#1 Absolute Inspection
Yes, this is a MUST-DO before you make a preliminary offer.
Explore the neighbourhood, address concerns related to the condition of the property, its white goods, check the amenities, and also the noise levels! Ask questions to your agent, the landlord’s agent or the landlord.
Check up on who your immediate neighbours are, whether they have pets or young children and most importantly, check the reputation of your owner.
The condo management is always well aware and some small talk can help you get the much-needed information.
From here onwards, you must document and click pictures of everything you see:
- Any scratches, cracks and/or damages caused by mould or water
- Request to replace white wallpapers with paint (as they do get spoilt due to humidity during a 2-year lease)
- Watch out for white kitchen surfaces (especially if you are a family that cooks a lot of home-cooked meals)
- Open kitchen and bathroom cupboards (under the sink) to check for exposed pipes and/or broken fixtures
- Request to replace any creaking and/or damaged furniture
- Make a list of the number of household appliances, their brand, model, capacity and condition. (Go through the Inventory list)
- Note the number of air-conditioning units and find out if your Landlord has a preferred service contractor. (A direct service contract with the air-con brand can cost three times a regular air-con service contract)
- Take measurements of the room (for moving your furniture)
- Enquire about available parking on or near the property
- Enquire about the minimum repair clause (the amount usually varies between $150-$300)
- Ask about the landlord’s policy on keeping pets (if applicable)
If all of the above is in the clear and you have a verbal agreement from the Landlord or the Landlord’s agent, it is time to prep the LOI.
#2 LOI or The Letter of Intent
LOI or the Letter of Intent is a document that outlines a preliminary agreement between the two parties before a deal is sealed.
In Singapore, a prospective tenant can give an LOI to the landlord to express his intention of renting a particular property, and this document must include the tenant’s requests and all of the above inspection pictures /notes.
This document will secure your (tenant’s) needs before a good faith’s deposit is handed over to the Landlord.
This is the most important stage before a tenancy agreement can be signed. This is a window of negotiation for both sides to come to a consensus.
At this stage, the landlord may/may not approve all the requests and asks, which can eventually make or break the deal.
If the negotiation goes well and a majority of the asks are in fact approved, the tenant should request a copy of the tenancy agreement. Here’s why!👇
#4 Rental Tenancy Agreement (TA)
The Tenancy Agreement (TA) is a legally binding document detailing the rental terms between you (the tenant) and the landlord. It is usually prepared by the landlord (or their appointed agent) according to the Council of Estate Agencies (CEA) template.
It is every tenant’s right to request a read-through of the TA before a good faith’s deposit is paid.
It is ideal to share the copy of the TA electronically, so changes can be requested and documented at the same time. Additionally, sharing the TA before the payment of the security deposit will help ensure there are no surprise clauses such as an “Arbitration clause” or a “House rules” clause that can make a tenant’s life miserable after the agreement is signed.
As such, it is paramount to have a clearly worded leasing contract and if the Landlord resists sharing a copy of such rental tenancy agreement (TA) before the good faith deposit can be paid, consider this a sign of trouble.
# 5 The Security Deposit
In the Tenancy Agreement (TA), the clause for the security deposit usually sets the terms to protect the landlord if the tenant breaks or violates the terms of the lease or rental agreement.
The Security Deposit clause must clearly state a firm deadline for when the security deposit will be refunded.
The security deposit is typically a month’s rent for a one year lease or 2 month’s rent for a 2-year lease. However, the agreement could specify a 14-day waiting period after the lease expiry before the return of the security deposit. This is for the landlord to assess and cover the cost of repairing and replacing any damages while allowing leeway for fair wear and tear of items. Read here to see — what comes under fair wear and tear?
#6 The Diplomatic Clause
Tenancy agreements of two years must include a diplomatic clause.
A diplomatic clause in a tenancy agreement allows an expatriate tenant to terminate the tenancy before its expiry in the event the tenant has to leave Singapore due to job relocation or layoff by the employer. Your landlord must return the deposit, provided
- the tenant has occupied the premises for a minimum period of TWELVE (12) months.
- After which, the tenant has given at least TWO (2) calendar months notice in writing to the landlord to terminate the tenancy or TWO (2) months rent instead of such notice.
- The tenant also needs to give evidence/proof of relocation or reason for breaking the lease.
Usually, there is also an additional clause that comes along with the diplomatic clause, and this is called the reimbursement clause. It makes the tenant liable to reimburse the landlord of the agent’s fees on a pro-rata basis. However, if you (tenant) can help find a new tenant to take over the rest of the lease, there is always a possibility to negotiate these fees and reach a mutual consensus in the best interest of both parties involved.
#7 Privacy and Access
While you (tenant) are staying on the landlord’s premises, you are entitled to reasonable peace, comfort and privacy.
The landlord/landlord's agent, or another person authorised by the landlord, can enter the premises without your consent and without notice, only:
a) in an emergency, or
b) if the landlord thinks that the premises have been abandoned, or
c) in accordance with an order of the NSW Civil and Administrative Tribunal (NCAT), or
d) if they have a serious concern about the health/safety of a person on the premises (after they have first tried to get your consent to enter).
Except in the case of (b/d) above, the limits to entry without consent do not apply. The landlord must provide the tenant at least forty-eight (48) hours prior written notice to perform essential repairs or arrange a viewing of the apartment for a prospective sale or during the two (2) months preceding the expiration or termination of the tenancy term.
Besides the above, there is no comprehensive law governing landlord-tenant relations, so much depends on the tenancy agreement. Therefore, carefully going through the clauses within the TA and agreeing to them before the good faith deposit is paid, will ensure the fate of your landlord-tenant relationship. But despite all precautions, if you still land in a dispute, you can seek some legal counsel from registered property lawyers.
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