The revised subletting rules for Singapore permanent residents (SPR) took effect from yesterday.
Previously, both Singapore citizens and SPR flat owners are allowed to sublet their flat after meeting the Minimum Occupation Period (MOP). The approval is granted for a maximum of three years per application. Owners can apply to renew the period of subletting upon the expiry of each 3-year period, with no cap on the number of renewals and the total period of subletting.
Under the revised rule, SPR flat owners will be allowed to sublet their flat after meeting the MOP, if they have not sublet the flat before. Instead of three years, the approval will be granted for one year only.
Upon expiry of the 1-year period, the application to extend the approval will be assessed on a case-by-case basis and approval will be granted only if there are extenuating reasons. The total period of subletting during the flat owners’ entire duration of the flat ownership is capped at five years.
The revised rule is to reinforce the policy intent of providing HDB flats as homes to SPR, and to deter those who are buying the flats for rental yield or investment. While HDB allows SPR owners who have met the MOP to sublet their flat, the subletting should be on a temporary basis. If the SPR families no longer need the flats for their own occupation, they should sell the flat instead of subletting them.
The problem with these rules is whether they can be enforced properly. I suspect some PRs who don’t fulfill the rules might end up subletting their units without getting any approval. Just like how some people are presently subletting their units for short-term stay.