Rooms let out on sites that are not zoned for hotel use
A NEW type of lodging for foreign workers has sprung up in Little India in recent years, with some offering air-conditioned rooms, cable television and housekeeping services, among other amenities.

But these establishments have come under scrutiny by government agencies, which say that some may not be operating legally and have clamped down on at least two in recent weeks.

At least nine such foreign worker hotels have come up in the past two years. Seven of them are owned by local property company DRA Property Management, spread out over Desker Road, Rowell Road and Dunlop Street.

One is operated by supermarket chain I-Tec above its Jalan Besar retail outlet, while the ninth is operated by the owner of Lamea Restaurant in Desker Road.

They have come up due to demand from foreign workers, particularly those who have not been housed in dorms by their companies, as well as tourists on a tight budget and foreign job seekers looking for a cheap place to stay.

The big attraction is their rates, which can be a fraction of what traditional hotels charge.

Rates range from $7 a night – for a bunk bed in a dorm-like room that can fit up to 30 people – to about $1,200 a month for an air-conditioned room shared by four people.

But it appears that such businesses may be operating on locations that have not been zoned for hotel use and are meant for other purposes, such as commercial or residential activity.

In addition, most of them do not have hotel licences, claiming that they are merely ‘residences’. But technically, they meet the Government’s definition of a hotel or boarding house, in which case they would need a licence and must operate on a location zoned for hotel use.

This definition, by the Hotel Licensing Board, states that any place with four or more rooms hired out for a fee, and that provides domestic services such as room cleaning, must get a hotel licence.

The Urban Redevelopment Authority (URA) has already told at least two DRA residences in Rowell Road to shut down by the middle of next month because those sites have been zoned for commercial use and not for hotel use. The DRA spokesman said the company plans to appeal.

Mr Jolovan Wham, spokesman for foreign workers’ rights group Home, said that such establishments helped to fill a gap in housing, by providing cheap yet comfortable accommodation.

‘Other places can be quite squalid, with no proper management. At least these boarding houses are maintained well, sometimes even with air-conditioning,’ he said.

Guests also gave the thumbs-up, saying such establishments provide good service at a low cost.

Mr Dhanam Tennakoon, 74, who is from Sri Lanka, has been sharing a room with two relatives at a DRA residence for the past six months while one of his relatives seeks medical treatment here.

‘We like this place. It’s very reasonable, and it lets us do our own cooking and washing,’ said Mr Tennakoon.

When told that the establishment might be illegal, he shrugged. ‘We pay, and we stay. That’s all I know.’

But others are less thrilled to see such businesses springing up. The Straits Times understands that the URA has received a number of complaints from the public, alleging that some of them are illegal boarding houses.

A URA spokesman said it is investigating some of these establishments.

Under the Planning Act, a person responsible for unauthorised use of a property may be fined up to $200,000 and/or imprisoned for up to a year. If the offence continues after conviction, a fine of up to $10,000 per day may be imposed.

Owners of unlicensed hotels may also be fined up to $2,000 on the first conviction, under the Hotel Act. For subsequent offences, the person may incur the same fine and/or be sent to prison for up to six months.

Source: Straits Times, 25 Aug 2010

AS AT the end of last month, some 42,000 flat owners had registered with the Housing Board to sublet rooms.

Under a new rule introduced on Feb 1, anyone subletting rooms in HDB flats must register within seven days; those who had sublet before that date were given a six-month grace period until July 31 to do so.

This requirement dovetails with efforts by the Ministry of Home Affairs (MHA) to eradicate loan-sharking activities and protect HDB residents from falling victim to such activities.

When some people borrow money from loan sharks, they move to a new location but give the loan sharks their previous addresses.

This way, if they fall behind on payments, those living at their former addresses will be the ones harassed by the loan sharks.

The new rule enables HDB to capture the particulars of those who rent rooms in HDB flats and allows MHA to trace the movement of borrowers.

HDB may impose a penalty on those who fail to register their subletting.

The penalty could be a fine of up to $3,000, and for recalcitrant cases, HDB could take back the flat.

Source: Straits Times, 7 Aug 2010

THE Housing Board (HDB) rental market continues to strengthen with larger units showing the biggest rental jump.

Overall median monthly rentals inched up in the second quarter, helped by the demand from those fleeing from high private property rents. Foreigners and locals who have sold their homes in a hot market are among those boosting HDB rents, experts say.

Overall, median rentals for two- and three-room flats were flat at $1,200 and $1,500 respectively. But four-room, five-room and executive flats saw median rental increases of between $50 and $100 a month from the previous quarter.

Four-room flat monthly rentals rose to $1,800 from $1,750, five-room flat rentals were $2,000 from $1,900 and executive flat rentals climbed to $2,100 from $2,000 in the previous quarter.

Median rentals for executive flats in Queenstown also passed the $3,000 mark for the first time since the fourth quarter of 2008, rising to $3,200. There were, however, fewer than 10 of such sublets.

Five-room flats median monthly rentals in the central region also hovered over the $3,000 benchmark for the second consecutive quarter at $3,150.

Executive flats in Jurong East saw one of the largest jumps, of $300, from $2,100 to $2,400, while areas such as Bukit Batok and Sengkang generally saw higher rentals across all flat types.

Property experts say these second quarter median rentals have hit the peak previously achieved in the second half of 2008. They expect further rise and new benchmarks to be set later this year.

Ngee Ann Polytechnic real estate lecturer Nicholas Mak said as private rentals rose steadily, some tenants were likely to look for cheaper alternatives.

‘The rate of rental increase might have outpaced the rental budget and so some tenants might prefer an HDB flat in a better location,’ he said.

HSR executive director (agency) Jeffrey Hong said that the strong demand is partly due to an influx of foreigners this year into sectors such as information technology, as companies have started hiring again.

Some Singaporeans who sold their property to cash in on high property prices have also decided to rent temporarily instead of buying immediately, he said.

Ms Hwa Hui-en, 24, a social worker, has been renting a four-room flat with four others near Ghim Moh for $2,000 a month since November last year.

She is worried her rent might rise when her lease ends in November as some of her friends have had to move out of rented homes due to higher asking rents.

‘Rentals are quite costly… We’re splitting the rent among five people and are sharing rooms now. If we don’t, it will probably take up a huge portion of our salary, maybe even one quarter of it.’

HDB said subletting deals rose about 15 per cent from 6,606 in the first quarter to 7,595 in the second – taking total approved sublet units to 30,500.

Source: Straits Times, 24 Jul 2010

FLAT owners who sublet rooms in Housing Board flats have until the end of this month to register with the board if the subletting began before Feb 1.

For subletting that started from that date or later, registration must be done within seven days from when the subletting began.

This requirement is in line with ongoing efforts by the Ministry of Home Affairs (MHA) to eradicate loan-sharking activities and help protect HDB residents from being victimised by such activities.

When some people borrow money from loan sharks, they move to a new location but give the loan sharks their previous addresses. This way, if they fall behind on payments, those living at their former addresses will be the ones harassed by the loan sharks.

The new rule enables HDB to capture the particulars of those who rent rooms in HDB flats and allows MHA to trace the movement of borrowers.

HDB may impose a penalty on those who fail to register their subletting. The penalty could involve a fine of up to $3,000, and for recalcitrant cases, HDB could take back the flat.

For further information or inquiries, the public can call HDB’s toll-free Subletting of Flat & Rooms Enquiry Line on 1800-555-6370.

Source: Straits Times, 16 Jul 2010

Some 32,000 flat owners have registered their subletting of rooms with HDB as of end June.

HDB has also issued a reminder to those whose tenancies started before February, that their six months grace period for registration will end at the end of this month.

Those who sublet from February 1 are required to register with HDB within seven days from the start date of the subletting.

Flat owners are also required to notify HDB when they renew or terminate their subletting contracts, and when there are changes to their subtenants’ particulars.

There’s however no need to seek prior approval for subletting of rooms.

HDB says this requirement supports the Home Affairs Ministry’s ongoing efforts to eradicate loansharking activities, and to better protect residents.

The housing board says it may impose a penalty on those who flout the rule.

The penalty may involve a fine of up to $3,000 or for recalcitrant cases, compulsory acquisition of their flats.

Source: Channel News Asia, 15 Jul 2010

Rates have followed the dizzying rise in private property prices but ‘will stabilise or even correct’

Rental rates for residential units have tracked the dizzying rise in private property prices, with rents for condominiums posting a significant increase of 5.8 per cent over the first five months of this year.

Based on data from the Urban Redevelopment Authority (URA), median rentals of non-landed residential properties in January amount to $30.54 per square metre (psm) but were propelled higher to $32.41 psm in May.

Rentals for units in the central region are even higher at $36.89 psm in May.

The maximum rental per month for non-landed residential properties in the central region amounts to $114.58 psm, while minimum rental amounts to $11.64 psm.

Condominiums in the east and west recorded median rents of $27.68 psm and $27 psm, respectively, for the same period.

Meanwhile, rentals in the north-east region hit $26.39 psm, while north region rentals stand at $24.47 psm.

As for the rest of the country, maximum rentals range from $33.65 psm to $60.87 psm, while minimum rentals range from $10.18 psm to $14.36 psm.

Market watchers said the significant increase in residential rents is due to an improving economy and a robust property market.

Donald Han, managing director of Cushman and Wakefield, attributed the rise to landlords looking to pocket higher returns from the bullish growth by increasing rents.

“Businesses have started to relocate to Singapore and are bringing in a lot of foreign workers, which have increased demand for residential housing, as compared to the first half of last year, when companies were shedding staff,” said Mr Han.

However, Mr Colin Tan, head of research and consultancy at Chesterton Suntec International, said the rental increase is due to a sharp drop in housing supply.

In the fourth quarter of last year, the number of demolitions jumped to 1,441 – more than the 1,400 units available.

Mr Tan attributes this to an increased number of collective sales, which resulted in more units being demolished during that period.

Unable to make up for the drastic loss, the first quarter of this year, only saw 1,407 units available for occupancy.

“The higher number of demolitions is probably a one-off effect. The numbers of demolished units returned to about 400 units-odd in the first quarter of this year,” added Mr Tan.

With a lot fewer units available and the ongoing high demand for residential properties, rentals hence saw a considerable increase.

Barring drastic changes, he expects rentals to stabilise in the coming months.

“Once the effect of the sharp reduction in housing stock wears off, the rise in rentals will stabilise and may even correct in the coming quarters unless demand is ramped up suddenly but that does not seem to be the case,” he said.

Mr Han expects rentals to increase to about 5 per cent to 8 per cent by the end of this year, in line with the bright outlook for Singapore’s growth.

With growing yields, it is also an ideal time for home owners looking to lease out their properties to hedge against inflation and volatile markets.

“Yields have risen slightly to 3 per cent to 3.8 per cent and are likely to go up over 4 per cent at end of the year. With the low interest rate of 1 per cent to 1.2 per cent, this is a good time for residential yields,” said Mr Han.

Source: Today, 9 Jul 2010

THE HDB has announced that as of April 30, 20,258 owners have registered their subletting of homes with HDB. This figure includes those with tenancies commencing before and after Feb 1, 2010.

On Jan 12 this year, HDB announced that with effect from Feb 1, 2010, flat owners who sublet rooms in their HDB flats will have to register with HDB within seven days of doing so. They are also required to notify HDB when they renew or terminate their subletting contracts, and when there are changes to their subtenant’s particulars.

This rule applied to all and existing cases of rooms sublets.

For new cases of subletting from Feb 1, 2010, owners are required to register with the HDB within seven days from the start date of subletting.

For subletting tenancies that commenced before Feb 1, 2010, owners are given a six-month grace period from Feb 1, 2010 to register their subletting with HDB.

HDB may impose a penalty on those who flout the rule. The penalty may involve a fine of up to $3,000 or, for recalcitrant cases, compulsory acquisition of their flats.

Source: Business Times, 4 Jun 2010

THE Housing Board yesterday reminded flat owners who sub-let rooms before Feb 1 that they have until July 31 to register their tenants’ details with the HDB.

All flat owners are now required to register the sub-letting arrangements, under a new rule introduced earlier this year.

From Feb 1, anyone sub-letting a room has been given seven days to register, but a six-month grace period expiring July 31 was granted for those who had sub-let before the beginning of February.

In all, 20,258 flat owners had registered their subletting of rooms with the HDB, as of April 30.

That figure includes flat owners with sub-letting tenancies commencing both before and from Feb 1, the board said.

Part of the reason the new rule was introduced was to try to curb the worsening activities of loan sharks.

Some people who borrow from loan sharks and who rent rooms in HDB flats have been known to use their former addresses when borrowing.

That leaves a flat’s new occupants to face possible harassment from the illegal moneylenders.

The rule was implemented to track those who borrow from loan sharks.

‘There is no need to seek prior approval for subletting of rooms,’ the HDB said.

However, flat owners are required to notify the HDB when they renew or terminate their sub-letting contracts, as well as when a new sub-let starts.

Registration can be done online or at any HDB branch office.

The board said that those who flout the rule may be fined up to $3,000. For recalcitrant cases, compulsory acquisition of their flats could be carried out.

Source: Straits Times, 4 Jun 2010

POTENTIAL landlords, here’s a tip: Turn the apartment you are planning to rent out into a “green” home.

The reason? More Singaporean renters are clamouring for lower energy costs and an eco-friendly lifestyle.

Despite the higher cost of energy-efficient appliances, landlords are moving towards investing in energy-saving air-conditioning units, for example, as a green apartment can command rents which are up to 10 per cent above the market rate, said estate agents.

Five agents my paper spoke to reported seeing more clients with a preference for energy-efficient household appliances.

According to them, this trend started a couple of years ago and has been picking up in the last half a year.

These days, about three out of 10 clients ask about the energy efficiency of appliances, compared to almost none three years ago, they said.

One of the estate agents, Mr Michael Lim, 43, said that, thanks to campaigns by environmental advocates, people now know that energy-efficient appliances – though usually pricier – will help them save on their utility bills in the long run. People are also more aware of the benefits of going green.

“Landlords are willing to invest in these appliances because they become a bargaining tool,” said Mr Lim.

Estate agent Susan Lim, 37, said: “People want to do their part for the environment.

They’re willing to pay more rent not just because of the money they will save from electricity bills, but also because they want to lead an eco-friendly lifestyle.”

Appliances have to be awarded three ticks and above under the National Environment Agency’s (NEA) labelling scheme to qualify as energy-efficient. The highest number of ticks which can be awarded is four.

NEA recently released figures which showed that sales of energy-efficient appliances have increased. It said that sales of energy- efficient air-conditioners went up by more than 20 per cent from last October to March, compared to the three months prior to the period.

Mr Kelvin Ng, 42, who just moved to his second home, decided to furnish his first one with energy-efficient appliances.

The graphic designer said: “Buying energy-efficient appliances is a good investment, as the tenants and I would benefit.” Mr Ng’s four-room Housing Board flat in Bedok is being rented out for $2,500 a month, $100 above his expectations.

In this case, the estimated savings from just three energy- efficient appliances, not counting lights, is over $300 per year.

Source: my paper, 4 Jun 2010

A man was sentenced to 16 months’ jail in a district court on Monday for cheating four China nationals of S$10,700 in rental fees.

Ivan Tey, who is 35, owns a four-room flat in Jurong West.

Although he had rented the flat to other tenants, he approached different housing agents in October and November last year to look for prospective tenants to rent the flat to.

He found four different tenants and collected rental deposits from them.

The tenants later realised Tey had signed tenancy agreements with other tenants and found other tenants living in the flat.

They then separately made police reports.

Tey’s lawyer, Mr Joseph Chen, told the court that Tey committed the offences as he was in financial difficulty and had to support two young children.

He said Tey’s father is receiving treatment for cancer and urged the court to impose a shorter jail sentence.

Source: Channel News Asia, 24 May 2010