What if we told you that the spare room in your HDB flat is worth $500 a month if you were to rent it out?
Or even more?
With the economy slowing down in the wake of the whole Covid-19 situation, if you’re considering renting out for extra side income, here’s how to determine how much rent your room is worth:
How much can you rent out your room for?
It’s not just homes or rooms in the “popular” neighbourhoods or central areas that have demand – there are tenants searching for homes everywhere in Singapore. For instance, someone working at the airport might choose to rent a place in the East to live close to work; students studying in the National University of Singapore (NUS) or Nanyang Technological University (NTU) might be looking for a place close to their campus in Jurong or Buona Vista.
Here are Singapore’s average HDB rental rates according to district in 2019 – which is a good indicator of rental rates this 2020 as well:
2. Your HDB flat’s market value
You can also see rent as a percentage of your home’s market value.
Location is an obvious determinant when evaluating your HDB flat’s market value. But even within every HDB block, this value can differ vastly based on factors like how well-furnished your home is.
Which is related to our next point:
3. Your HDB’s flat value… to your tenant
Ultimately, tenants are looking for rooms that offer the most bang for their buck.
Think about what a tenant would like in a home:
- If they’re renting the common room (i.e. without an attached toilet), will they have to share the common toilet with everyone else?
- Is housekeeping provided?
- Are utilities included? You either have the option of including utilities in the rent price, or split it equally among everyone each month.
- Single bed? Double bed? Double bed as soft as the touch of a thousand angels?
On the flipside, not everything that raises your HDB flat’s market value will raise your HDB flat’s value to your tenant. For instance, your home could be near a prestigious school, but if you’re renting to a single expat tenant, it wouldn’t matter to them.
4. Check what other landlords are charging
HDB has a handy rental price tool to check the prices of HDB flats that were recently rented out in any particular area in Singapore.
Simply select the town (or you can specify your search down to the block number) and the period you’re searching for (looking at places renting out in the past 6 months to a year will give you a good gauge of price.
This can give you a good estimate, but unfortunately, you can only creep on the rental rates of whole unit rentals, and not that of room rentals.
Another way around this is to simply check the rates indicated on rental listings.
When it comes to room rentals, a lot of landlords choose to rent out by themselves rather than through an agent, so it’s best to check on platforms which allow direct owners to advertise.
Not to toot our own horn, but… Yah lah, we’re talking about ourselves. Carousell. Here. Tons of direct owners list their room rentals here. There was no less egoistic way to put it.
5. Provide good quality photos of your HDB room rental
First impressions matter. A lot! With good quality photos, people are already attaching a higher value to your room right from the get-go.
Also, a study by the photography pros SmartShoot found that when potential tenants are looking at a rental listing, they spend about 60% of that time looking at the photos.
Our point is, photos! are! super! important!
You don’t have to engage a professional. Simply tidy up the room. Draw the curtains to let the light in. If you’re feeling fancy, clip a $3 wide angle lens onto your phone to make the room look more spacious.
But don’t be a catfish, of course. Make sure the room looks equally presentable when your potential tenants come for a viewing.
Renting out your HDB room
So, you should have a better idea of how much your room is worth in Singapore’s rental market.
On average, a Carouseller earns $800 a month renting their room out on Carousell. That’s already $9,600 of passive income in a year! Check out how other homeowners are doing this rent-out-my-HDB-room thing here.
Convinced yet? We’re making your potential rental journey much easier. Check out Rental+, a free programme in partnership with FWD Insurance to make renting truly worry-free. You pay nothing AND get free insurance coverage on your room or apartment rental. Click here to find out more on Rental+!