Landlords of larger HDB flats and private residential properties will soon be able to grow their tenant base and rental income after a policy change takes effect in January to relax the rental occupancy cap for such properties for about three years.
But those who earn more rental income after raising their tenant headcount, and in turn see higher annual values of their properties, will likely be liable for higher property taxes, said Ms Chia Siew Chuin, JLL’s head of residential research for Singapore.
Meanwhile, the policy change could benefit larger households in need of interim housing, lower income groups, as well as students and workers in sectors such as nursing, F&B and retail, analysts said.
These tenants will have the option of sharing a unit with more people and saving on rental costs, said Ms Christine Sun, OrangeTee & Tie’s senior vice-president of research and analytics.
From Jan 22 next year to Dec 31, 2026, owners of four-room or larger flats and private homes of at least 90 sq m can house up to eight unrelated people not from the same family unit, up from the current cap of six, said HDB and the Urban Redevelopment Authority on Dec 20.
The increased cap could result in landlords charging higher rent for a larger unit with more tenants, but each tenant may end up paying less, Ms Sun noted.
She gave an example of how a landlord of a 5-room HDB flat in Bedok that previously charged $4,200 for six people – $700 per person – may now charge $4,800 for eight people, or $600 per person.
“This benefits both landlords and tenants as each tenant pays less while landlords earn higher overall rent,” she said.
Landlords of smaller homes could be affected if potential tenants switch to renting bigger units with their friends or colleagues, Ms Sun added.
The Straits Times
