Tenancy agreement and security deposit in Singapore: What renters must know

19 min read

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 their agent) to finalise the monthly rental rate.

Then comes time to sign the rental agreement. You take a cursory 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?

Person signing the tenancy agreement
Read through your tenancy agreement before signing on the dotted line!

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), if a term or clause is not explicitly written in a contract that two (or more) parties have endorsed, it does not exist.

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

Most landlords are perfectly reasonable individuals 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 clearly conveys what you, the tenant, want.

Always make sure you read the Tenancy Agreement thoroughly before signing it.

What’s in a tenancy agreement? 

If the CEA template is not being used, all rental agreements should include the following information:

  • Full name and contact address of the landlord and tenant
  • Address of the property to be rented
  • The date the TA is signed
  • Lease period, including the starting and end dates of the tenancy
  • The rent amount and frequency of payments
  • Payment mode and the account to which payment is to be made
  • Any fees to be paid (eg. security deposit)
  • Inventory list of all the items in the apartment

What’s the difference between a Tenancy Agreement and Letter of Intent?

A tenancy agreement (TA) is the more detailed, legally binding version of the letter of intent (LOI). The document states the rental terms agreed by the landlord and tenant. It also sets out each party’s rights and obligations with regards to the tenancy. Ordinarily, the landlord — or the property agent of the landlord — prepares the tenancy agreement in accordance with the LOI.

Note that the TA is more important than the LOI, and must be read in close detail. If there are legal disputes, the final outcome hinges on this document.

There is a high possibility the rental agreement the landlord sends is copied and pasted from a standard template from the real estate salesperson’s agency.

If you want a guideline to compare your rental contract to, the Council for Estate Agencies (CEA) has tenancy agreement templates for both HDB and private residential properties.

Remember, these clauses aren’t set in stone, so you’ll have the freedom to tweak them if they are too vague or don’t 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, they might disagree with your terms, and you’ll have to find a middle ground.

You’re advised to have a property agent of your own to go through the TA, at least for your first time as a tenant in Singapore.

Security deposit

In Singapore, the signing of the rental agreement is often concurrent with your handing over of the security deposit.

By convention (not law), the security deposit is one month’s rent for a one-year lease, or double that for a two-year lease. It will be refunded at the end of the lease, after deductions due to damages.

If there is any damage to the property besides fair wear and tear, the landlord can subtract the cost of damages from your security deposit. In general, the deposit is only used to cover damages for which you are directly responsible. A leak caused by an old kitchen pipe won’t be deducted from your deposit, but a hole in the wall from a wild party will be.

If there’s a premature termination of the lease – and no clause in the TA permits such a termination – your security deposit can be withheld. In short, breaking the lease causes you to forfeit the deposit.

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… “

Unfortunately, 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 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 to claim for any expenses from their tenants.

Recommendation: To correct this, be explicit and include a line that says “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 deducting any amount from the security deposit” and that “the deposit must be paid back within x number of days from the end of the lease”. (Usually, the period of time would be from two weeks to a month.)

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, including the furniture (if it comes fully furnished). 

Should there be any disagreements in the future, tenants will have sufficient evidence to plead their case.

Read this: Good faith deposit VS Security deposit

What to look out for in a rental tenancy agreement in Singapore? 

In addition to the above, many rental contracts in Singapore include clauses regarding:

  • Payment for utilities (find out if this is included in the rent; if yes, find out if it includes internet access — some agreements only cover water and electricity)
  • Insurance matters (note that the landlord’s home content insurance may not extend to cover tenants)
  • Applicable rental stamp duty
  • Conditions of access to premises (this states when and how your landlord can enter the house during the lease period)
  • Any regular servicing schedules, such as air-conditioner servicing or gardening (for landed properties)
  • Conditions of the security deposit and good faith deposit
  • Termination clauses
  • Details of what happens if rent is paid late or not at all.

Here are some clauses to pay special attention to.

1. Diplomatic clause and reimbursement clause (Early termination of lease)

Expatriates should insist on this clause. This lets you terminate the lease prematurely if you lose your job or are transferred to another country.

Usually, the clause can be exercised after you are 12 months into a two-year lease. It allows you to terminate the contract without having to pay the additional months of rent.

By convention, a notice period of two months will be stated in the clause.

If you require the landlord to include the diplomatic clause, it is not unusual for a reimbursement clause to be included. This stipulates that you have to reimburse a part of the property agent’s commission.

You can find out more about early termination of lease agreements in our guide here.

For more information on common commission rates and responsibilities, check out our agent commission guide.

2. Minor repair clause and other maintenance clause

This clause states how much you are liable to pay, for damage caused by wear and tear. Damage from direct negligence is deducted from the security deposit.

We advise all tenants to insert a problem-free period clause in the tenancy agreement, preferably 30 days or more. This way you are not liable for any damages during the initial period of the lease. It also protects you from damages caused by the previous tenant.

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 their own contractor.

Fair wear and tear occurs the longer you live in a property. Bulbs require changing, curtains and carpets require cleaning, etc. 

changing light bulb

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 set defined limits to the amount the tenant should pay for minor repairs and ensure that the landlord will be responsible for the cost of rectifying major ones.

Recommendations: Tenants should include a statement mentioning they are “responsible for the first S$150 – S$300 (depending on what’s negotiated) of repairs, after which the landlord should bear the rest, should the overall cost exceed the stipulated amount.”

For instance, the washing machine requires repairing and it costs S$200. As a tenant, you’ll have to pay the first S$150 (depending on what’s negotiated and written in the contract), while your landlord will cover the remaining S$50.

Also, the tenant should be able to “choose their preferred maintenance people” if required.

3. Option to renew clause

This is a clause that lets tenants extend the lease for another term — usually a year — with a two-month prior notice. If the clause is exercised, the landlord will prepare a contract for an extension. The clauses stay the same as the current contract unless specified otherwise.

4. Access to premises clause

There are usually a series of “Access to Premises” clauses, allowing landlords to enter the premises for a stated purpose. Typically, the purposes for which a landlord would enter the premises is for repair work or viewings for future tenants.

You don’t want to come home after a long day at work to find a bunch of strangers poking around your belongings and judging your dirty dishes in the sink.

Towards the end of your lease, the landlord may arrange for viewings to minimise the vacancy period of the unit.

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 decide to allow prospective tenants to view the unit before the current lease expires at times that the current tenant might disagree on. 

Unless you’re 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 scheduling their house-viewings. 

For example, tenants can stipulate 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 logged messages across all platforms, such as Whatsapp/Telegram/WeChat messages, SMS and emails.

5. Rent payments clause

The last thing you want is coming back from an overseas trip to find your belongings unceremoniously dumped outside the unit.

This happened to a tenant whose landlord went nuclear and forcibly evicted them by acquiring an HDB letter terminating approval to rent out the entire unit, citing that she wanted to move back into the flat. 

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 (and courtesy) that tenants should fulfil these conditions stipulated in the contract. 

However, there might be instances where the tenant may not be able to meet their repayments on time, such as being on an overseas business trip, or if the landlord changes their bank account details without informing the tenant. 

Recommendations: Tenants should indemnify themselves from late payment penalties if they have made 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”.

HDB flats for rent


6. En-bloc clause

This clause states that, if there is a collective sale of the development, the landlord can sell the property and prematurely terminate your lease without compensation. En-bloc sales are passed by a majority of the development’s owners, so your landlord has to sell the property regardless of whether he wants to or not.

This is a risk to take seriously when renting very old leasehold properties, such as those that are past 30 or 40 years in age. Given how long it takes an en bloc to proceed, however, it’s probable that your lease will be over long before you need to vacate the property.

Condos below 30 years old for rent