Whether you’re currently a landlord or are thinking of becoming one, let’s be real, this was probably not how you envisioned 2020.
The Covid-19 pandemic has caused a major collapse in economies all around the world, and unfortunately, the property rental market in Singapore is not immune to that.
You might find that there are fewer people looking to rent; or even if your property is currently rented out, your current tenant might suddenly find themselves struggling to pay rent.
Ok, but we’re not just here to paint some bleak picture – there are ways to minimise the impact of Covid-19 on your rental income. Here’s how you can still keep your rent dollars coming in:
If you already have an existing tenant…
1. Pass on your homeowner benefits
As a homeowner, the Monetary Authority of Singapore (MAS) has schemes to help tide you through this whole Covid-19 nightmare. For one, home loans can be deferred up to 31 December 2020.
Not so much for tenants, whose monthly rental payments are still entirely theirs to shoulder. If your tenant is having temporary cash flow problems and you trust them enough to repay their rent eventually, consider deferring their rent partially for the time being.
Once they bounce back, work out a payment schedule for them to repay the rent that they owe you.
Willing to go the extra mile? If you rely on your rental income to repay your home loan, for instance, you could defer your home loan and pass on the benefits to your tenant.
This definitely beats revoking the entire rental contract and having to find new tenants, as this could take time (even more time, especially in this current situation). And you’re essentially bleeding rental income for each day that your property is left vacant.
2. Know your tenancy agreement
Now’s the time to dig up your tenancy agreement to check the terms laid out in it, so you’re prepared for potential situations that might be thrown your way. Especially situations that are brought about by the current climate.
For instance, the Diplomatic Clause states that if your expat tenant is transferred out of Singapore by his company, or is terminated and has to go back to their home country, they can break the lease before it expires.
Some tenancy agreements also state that either party can request to terminate the lease early, as long as they give a certain amount of notice.
If such clauses exist in your tenancy agreement, have a back-up plan if your tenant decides to exercise them.
Are you confident of renting your place out once again right after the tenant moves out? Are you going to DIY it, or engage a property agent?
Or, consider using this void period to upgrade the space, so you’ll be able to charge more rent when you do decide to start marketing your property for rent.
3. Establish a good relationship with your tenant
Check in on them periodically, whether it’s a phone call or a quick text. If you’re feeling extra generous, perhaps a welfare pack or food parcels wouldn’t be off the table?
You’re not the only one going through a tough time, they are human after all. Show them that you care and they’re not just walking money makers. Studies say that a good landlord-tenant relationship is a great incentive for tenants to extend their lease after the current one expires!
If you’re looking for a tenant…
4. Take ownership of the marketing of your own property
Regardless of whether you’re marketing it yourself, or engaging an agent (or agents!):
If you’re marketing it yourself…
If you want full control of finding tenants to rent your property, consider listing on Carousell. (Bump or spotlight your listing for greater exposure to potential tenants!)
This also means you save on agent fees, which is normally 1 month’s worth of rent.
If you’re leaving it to the pros…
Also consider whether you want to let one agent do the renting out exclusively, or multiple agents market your rental.
Of course, you’re much more likely to get more exposure if you hand the job over to multiple agents at once, but because only the agent who seals the deal gets the commission, the agents will more likely prioritise speed over rental fee. On the other hand, an exclusive agent will be more incentivised to rent your property out at the highest price possible, since that’ll give them a higher commission.
Either way, although the agents are experts and are knowledgeable in this field, ultimately, you hold the reins to renting out your home because it is YOUR home.
5. “Can nego?” Yes.
Apart from price, there are many more ways to attract potential tenants: new furniture, use of the kitchen appliances and condiments, allowing the occasional overnight guest, by way of example.
Doing this not only shows you care about your tenants – which we’ve stressed how important it is earlier – but you’re more likely to attract future tenants who’ll keep your river of rental income flowing.
6. Lower your rent
Notice how we didn’t start off this guide with this step? Well, it’s because you shouldn’t jump right into it the second you realize your rental income could be at risk.
Research on the listings of the surrounding area, say a 1km radius, and check out how much they’re charging as rent.
And if you do decide to lower your rent, make up for it in other ways, such as longer lease periods. This ensures fewer or shorter void periods in the future, which will make up for the lower rent in the long run.
7. Look for a tenant, but don’t forget to look after your health
We can’t stress this enough!!!!!
One of the key steps to successfully finding new tenants is arranging viewings. Now that physical house viewings are a no-go, conduct live virtual tours via Whatsapp video call or the ever popular Zoom instead. The alternatives are endless. Go on and get creative!
Even after home viewings are allowed once again, adhere to safe distancing. Measure and mark out your home to indicate where all you and your visitors can stand/move around. Deep clean your property after.
Keep a record of your visitors: what time and date they visited your property, just in case you need it for contact tracing.
Renting out your property in difficult times
This whole Covid-19 situation is a maaaajor curveball, but chin up! At the end of the day, we all need a roof over our heads, so there will be people looking to rent. If you were a business, you’d be essential 😉 (Did we just come up with a pick-up line…?)
Whatever course of action you choose to take during this trying period, remember to keep within the safety guidelines to keep you, your tenants and the rest of the community safe. Check out how other landlords are doing it!
BTW, we’ve just launched 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. Trust us, it’ll make renting much easier than you think 😉 Click here to find out more on Rental+!