Rental News’s guides: Rental agreement – Terms you must include

November 25, 2016

Finding a place to rent is not as easy as it seems. Aside from the stress of attending multiple house viewings, there is the negotiation process with the landlord (or his/her agent) to finalise how much monthly rent is to be paid.

Then comes time to sign the rental agreement.  You take a quick glance and decide that the terms outlined are to your satisfaction. With the anticipation of finally securing a place to stay, you ink your initials on the contract.

What can go wrong, right?

Protecting your rights as a tenant

Let’s get real. Things do happen, and conflicts may occur. In the Singapore court of law (or in any other type of contractual agreement for that matter), if a term or clause is not explicitly written in a contract that has been endorsed by two (or more) parties, then it does not exist.

That is why prospective renters should always read through the terms outlined in the rental agreement before endorsing it. If in doubt, or disagreement, with specific sections, it is always best to clarify and request for an amendment.

Now, most landlords are perfectly reasonable individuals who are willing to compromise with their tenants. However, there are a rotten few who will find loopholes to exploit unsuspecting tenants of their money (and sanity). Therefore, to safeguard against future disagreements, always ensure that the rental agreement is clear in conveying what you, the tenant, want.

Terms you need to include in the rental agreement

There is a high possibility the rental agreement the landlord sends is drafted from a standard template from his/her real estate person’s agency. Remember, some of these clauses are not set in stone, so you’ll have the freedom to tweak them if they are too vague or/and do not work in your favour. Just be prepared for some back and forth with the landlord after you’ve indicated the changes you want to make – naturally, he or she might disagree with them.

That said, here are some terms you should be looking to amend:

Security deposits

Original terms: “To pay a deposit of $xx being equal to x months’ rent upon the signing of this Agreement (the receipt whereof the Landlord hereby acknowledges) as security for the due performance and observance by the Tenant of all covenants, conditions and stipulations on the part of the Tenant herein contained… “

Cases of tenants having to forfeit a sizeable amount (or the entirety) of their security deposit to their landlords for reasons other than damages to the property unfortunately do happen.

To prevent this from occurring, tenants should ensure the rules for returning the deposit are laid out in the contract. Usually, a rental agreement will mention something along the lines of “due performance” or “non-performance”, a term landlords use as a catch-all term to claim for any expenses from their tenants.

Recommendation: To correct this, be explicit and include a mention that “the security deposit is only to be used in relation to damages to the property or unpaid rents.” Tenants should also state that landlords must “advise them in writing first before proceeding with deducting any amount from the security deposit” and that “the deposit must be paid back within 14 days from the end of the lease”.  

It also helps to document the state of the apartment during the house inspection. And by document, we mean fastidiously examining and taking photographs of every corner of the house, inclusive of the furniture if it comes fully-furnished. Should there be any disagreements in the future, tenants will have sufficient evidence to plead their case.

Household repairs

Original terms: “All minor repairs and replacement of parts and other expendable items at its own expense. The Landlord’s approval must be obtained prior to repairs and the Landlord reserves the right to engage his contractor.

Fair wear and tear does occur the longer you stay in a property – bulbs need to be changed, curtains and carpets need to be cleaned etc. However, should the washing machine call it quits or water from burst pipes flood the kitchen, the cost of maintenance will skyrocket faster than the inflation of the Zimbabwean Dollar.

To avoid incurring additional expenses during the tenancy period, the rental agreement should define limits to the amount the tenant should pay for minor repairs, and ensure that the landlord should be responsible for cost of rectifying major ones.

Recommendations: Tenants should include a statement mentioning they are “responsible for the first $150 – $200 of repairs, after which the landlord should bear the rest should the overall cost exceed this.” Also, the tenant should be able to “choose their own maintenance people” if required.

Viewing of premises

Original terms: “During the two (2) months immediately preceding the expiration of the tenancy herein, to permit the Landlord or its representatives at all reasonable times and by prior appointment to bring interested parties to view the said premises for the purpose of letting the same.”

The problem with the word “reasonable” is its subjectivity – what is reasonable to one person, might not be for another. A landlord may choose to allow prospective tenants to view the unit before the current lease expires at times which the current tenant might not agree on. Unless you are truly comfortable having strangers wander into your personal space at odd hours, it is best to establish boundaries in the rental agreement.

Recommendations: Give a reasonable time frame for landlords to set a prior appointment before they schedule their house-viewings. For example, tenants can stipulated that “prior permission by tenant(s) must be made in writing, at least 24-48 hours in advance”. There are also merits to be even more specific – “in writing” can be further expanded to include Whatsapp/LINE/Wechat messages, SMS and emails.

Rent payments

Original terms: If the rent hereby reserved shall not be paid for seven (7) days after its due date or if there shall be a breach of any of the conditions, covenants or stipulations on the part of the Tenant herein contained, the Landlord shall be entitled to re-enter upon the said premises.”

A typical rental agreement will document when and how much rent is due. It is common sense that tenants should fulfil these conditions stipulated in the contract. However, there might be instances where the tenant may not be able to meet his/her repayments in time, such as having an overseas business trip, or if the landlord fails to inform the tenant that he/she has changed the bank account the rent should be paid to.

Recommendations: Tenants should indemnify themselves from the penalties of late payment if they did make sufficient efforts to meet their payments. They can do this by including ”tenant(s) will not be held accountable for interest or late payment if he/she has made all reasonable attempts to pay by the clearly communicated rental payment arrangement”.

Check out other rental related articles here: Ask the expert: Breaking your rental lease early in Singapore and 6 important rental terms tenants in Singapore should know

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