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| Home Advice Tips |
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 To lease a self-occupied property with a mortgage:
Landlords must obtain written consent from the bank beforehand. So, remember to file an application to your bank.
Important:
The bank has the right to adjust the mortgage interest rate and/or other terms on the grounds that the use of the property has been changed from owner-occupied to leased.
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To lease a property under the Government Home Ownership Scheme:
Under the law, before a property under the Government Home Ownership Scheme is leased in the open market, the landlord must pay the land premium and obtain a Certificate for Removal of Alienation Restrictions.
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To sell a property before the tenant's lease expires:
Given that the market for properties under leases is relatively small, landlords might see their power to bargain for a good price restricted.
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Search on your own:
Accurate information about your property must be provided to your potential tenant before the lease is signed.
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Through a licensed estate agent:
If you choose to engage a licensed estate agent to act on your behalf, you must clarify with your agent all the details of the engagement, such as the commission and the time of payment.
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How to assess the affordability of a potential tenant:
You may enquire about his or her occupation status, and even ask for income and credit proof.
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The tenancy agreement should cover:
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| 1. |
Uses and restrictions - The landlord should check and verify the relevant provisions in the Government Lease, Occupation Permit and Deed of Mutual Covenant.
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| 2. |
Rates, government rent and property management fees - Specify whether they are payable by the landlord or the tenant, as well as the arrangement for any increase or decrease of such outlays.
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| 3. |
Right of first refusal - In case the tenant is entitled to this right upon the expiry of the lease, the exercise period, as well as the lease period and the rent after renewal, etc., should be specified.
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| Maintenance provisions - The landlord may also specify in the tenancy agreement that the tenant shall keep the interior of the rental property in proper condition (other than latent defects, structural problems or natural wear and tear): |
| a) |
Maintain gas, water and electricity systems, as well as kitchen and bathroom facilities; |
| b) |
Keep the drainage system clear; |
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Replace the flooring, walls, doors, locks and glass fixtures of the rental property where necessary (such as where breakage occurs); |
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Prevent any damage to the interior of the rental property.
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| 5. |
Insurance - The landlord should inform the tenant if the rental property is insured and, if so, the scope of coverage. Specific provision can be made in the tenancy agreement to require the tenant to pay for additional premiums caused by any act on the part of the tenant.
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Points to note upon handover of the property:
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| 1. |
An inventory list should be drawn up of any furniture and electrical appliances which are to be leased as part of the rental property. The inventory check should be carried out one day before the handover.
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| 2. |
The rental deposit should be returned by the landlord to the tenant who has delivered vacant possession and paid the rent in full without an arrears of payment. The deposit receipt should be obtained from the tenant in return. If the tenancy agreement stipulates that in case the title to the rental property is transferred, the rental deposit will be transferred to the new landlord to be held under the same conditions, the tenant cannot object to this arrangement, nor may the tenant demand the return of the deposit from the original landlord.
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To safeguard the interests of landlord, it is a normal practice to require payment of one month's rent plus a deposit and other charges (if any) before the handover. |
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The landlord may require the tenant to set up an autopay instruction for the monthly rent to ensure timely payment. |
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The landlord must issue receipts for the deposit and all rent payments. Failure to do so constitutes a legal offence.
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To avoid any loss from damage, whether by fire or any malicious act, to the interior, as well as the furniture and fixtures in the rental property, the landlord should take out an insurance policy to fully cover against such risks.
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Important: If the tenant is consistently late in paying the rent, the landlord may apply to the court/ the Lands Tribunal for an order of payment of rent arrears or possession of the rental property.
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