5 Reasons to Avoid “Unofficial” Rental Arrangements

Despite deterrence efforts, there will always be some landlords and tenants in “unofficial” rental arrangements. It may be done to avoid  taxes; other times, landlords don’t know how to do the paperwork, but also don’t want to pay a property agent to handle it. Here’s why you don’t want to be involved:

Some examples of “unofficial” rental arrangements

The most common example of this is a landlord renting out with “no questions asked”. That is, the landlord agrees not to bother checking the tenant’s papers, so long as the tenant provides a good deal (e.g. two years of rent paid upfront, or a higher than usual rental income).

Another example is having a family member stay in the property, and then listing the property as “owner occupied” to lower property taxes. In the meantime, the family member either (1) doesn’t actually stay there, or (2) manages tenants who haven’t been declared to the authorities.

Yet another recent issue is short term rentals that are less than six months. There is a prior collaboration with the landlord, that you will “break the lease and disappear” after two or three months, without consequence.

(There are also more blatant criminal offences, like landlords allowing the property to be used as a brothel for a cut of the profits, or a gambling den – but we’ll assume you’re not falling into this category!)

The dangers of being an unofficial tenant

Whether its out of desperation, or a misguised attempt to save money, being an unofficial tenant is more hazardous than you imagine. Some of the key threats are:

• The landlord can outright scam you
• Living in squalid conditions
• Becoming a scapegoat
• Putting your job or studies at risk
• Constant fear and anxiety

1. The landlord can outright scam you

This is the biggest of being an “unofficial” tenant. The landlord can evict you at a moment’s notice –  and if you protest, the landlord can just claim she doesn’t even know who you are.

There’s no Tenancy Agreement (TA), no proper record of rental payments, and no indication that you even have any right to be there. You have no legal recourse if you’re scammed in this way – and you might be the one in trouble, if you’re accused of being in the house without permission.

Even if you think the landlord is trustworthy (e.g. she’s an old friend from school), it’s never worth the risk knowing this can happen.

2. Living in risky conditions

Unethical landlords cram in more tenants than allowed (the legal limit is six unrelated tenants). The last incident was in Geylang, when a fire caused four deaths. The more overcrowded the property, the greater the risk during situations like a fire.

Unofficial tenants also have no one to turn to. Complain about cockroaches, non-functional lights, or a lack of hot water, and your landlord can just laugh it off. This extends to safety issues, such as a lack of working fire extinguishers or makeshift stoves.

3. Becoming a scapegoat

Some landlords lure tenants into a property with cheap rental or “no questions asked” policies for a good reason: they just want a scapegoat.

One example of this is a landlord who’s sneaking in unlicensed cigarettes, or obscene DVDs. If the police locate it on their property, the landlord may disavow knowledge of it and pin it on the tenants. Sure, the landlord will still be in trouble for having illegal tenants – but you could be in much worse trouble.

4. Putting your job or studies at risk

If you’re a foreigner who’s here to work or study, always make sure your lease is legitimate. If a landlord kicks you out suddenly, it can disrupt your employment or exams.

Also, note that employers and schools get panicky if they find out you did something illegal (like, be an undeclared tenant). This can result in termination of your work pass, and expulsion from school.

So even if the landlord in question is a relative, play it safe and do things the proper way. No “informal arrangement” is worth the potential damage.

5. Constant fear and anxiety

Every time you put your address down on a form (such as for a job application or bank account), you’re going to panic a bit; because each time you do this heightens the risks of exposure. Even the simple process of ordering food or shopping online can make you nervous, when you realise your living arrangement is illegal.

You’ll worry about colleagues or fellow students asking where you live; even an innocent question by  a condo security guard can be nerve-wracking (they might ask whether you’re related to the landlord, if they see you all the time).

This is even worse if you know the landlord personally. If the landlord is a relative or personal friend, for example, you won’t want to to risk exposing them.

Overall, it just isn’t worth the constant paranoia. If your issue if finding an affordable place to rent, check out 99.co instead – you can filter based on price, to find a legitimate rental option within your price range.

Would you even consider an unofficial rental arrangement? Voice your thoughts in our comments section or on our Facebook community page.

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