Property Leasing Guide
Following the selection of the choice property for rent, offering the property rental with a letter of intent is a common procedure.
Letter of Intent is document stating your intention to lease with your requirement, outlining some preliminary agreement before proceeding to Lease/ Tenancy Agreement.
Letter of Intent, in most cases will be accompanied with good faith deposit indicating that you are serious about renting the property.
- Lease Terms
Usual Lease ranges from 12 to 24 months, with or without an option to renew for another 12 to 24 months upon the expiration subjecting to market rates at the point of renewal.
For renewal, the tenant is usually required to give 2 months prior notice to the Landlord.
- Good faith deposit
Good faith means that upon the Landlord sign/ accept the Letter of Intent with the deposit; Landlord commit not to lease the property to other prospect until the Tenancy Agreement is signed. Upon signing the Tenancy Agreement, this deposit is usually kept as security deposit.
- Security deposit
The amount paid by the Tenant to the Landlord when the Tenancy Agreement is signed as security deposit for any tenancy breaches or property damages due to tenants negligence.
Which otherwise will be refunded interest-free to the Tenant within 14 – 30days after the lease expire.
Typically, for 12-month lease 1-month deposit is required and 24-month lease 2 months deposit.
- Monthly rental
Letter of Intent will state the monthly rental amount offered throughout the Tenancy Period.
- Expiry of the Letter of Intent
Period within which the Landlord must sign, or it will otherwise expire. The Landlord will then have to return the good faith deposit immediately.
- Diplomatic Clause
Early exit clause for foreign tenant to terminate lease before fulfilling the full lease term, when the tenant is no longer employed or relocating to another country.
Typically, the minimum period is 12 months with 2 months’ prior notice for lease that is more than one year.
- Furnishing
States whether you require the property to be partially or fully furnished.
- Pets
If the tenant has any pets, it has to be stated in the Letter of Intent.
- Additional requirements need to be stated clearly in the Letter of Intent.
Tenancy Agreement is an binding contract to lease the property, most Landlord to prefer on a fixed term tenancy agreement over short/ flexible tenancy.
Copy of your passport/ID & work pass is to be provided to the Landlord to verify that you are entitled to stay in Singapore.
At the point of signing the tenancy agreement, you need to pay the first month’s advance rental & security deposit, less the good faith deposit given with the Letter of Intent.
