How to Increase Rent When Renewing Tenancy: Singapore Landlord's Guide

How to Increase Rent When Renewing Tenancy: Singapore Landlord's Complete Guide

Renewing a tenancy agreement presents landlords with a critical opportunity to adjust rental income in line with market conditions. Yet navigating rent increases requires balancing financial objectives with tenant relations, market realities, and Singapore's unique rental landscape. This comprehensive guide equips you with the knowledge to execute fair, defensible rent increases that protect your investment while maintaining positive landlord-tenant relationships.

At Homejourney, we believe transparent, informed decisions build trust in Singapore's rental market. This guide synthesizes current market data, legal frameworks, and practical strategies to help you approach rent renewal with confidence.

Table of Contents

• Understanding Singapore's Rental Market in 2026
• Legal Framework for Rent Increases
• Determining a Fair Rent Increase
• Conducting Market Research
• Negotiation Strategy and Timing
• Renewal vs. New Lease: Key Differences
• Documentation and Legal Requirements
• Balancing Rent Increases with Tenant Retention
• Common Mistakes Landlords Make
• Frequently Asked Questions

Understanding Singapore's Rental Market in 2026

Singapore's residential rental market is entering a period of moderation and structural rebalancing. Understanding these dynamics is essential before proposing any rent increase to your tenant.

Current Market Conditions

As of early 2026, Singapore's leasing market faces headwinds that directly impact rental pricing power. Corporate cost-cutting measures among multinational companies (MNCs) are reducing expatriate housing allowances, while employment pass holders—a key rental demographic—have declined to 201,200 by mid-2025. This contraction affects demand for premium rental units, particularly landed homes and high-end condominiums.

Conversely, demand is shifting toward smaller, budget-friendly units in the Rest of Central Region (RCR) and Outside Central Region (OCR). One-bedroom and two-bedroom units continue to attract tenants seeking cost-effective housing, suggesting that not all rental segments face equal pressure.

Vacancy Rates and Supply Dynamics

Vacancy rates stood at 6.9% in Q3 2025, with new completions like Lentor Modern and Gallery 8 entering the market. The influx of new supply means tenants have more options, reducing landlords' pricing power in oversupplied segments. However, established developments with proven rental demand—like Gallery 8 in District 15, which maintains a 4.0% rental yield—demonstrate that well-positioned properties can sustain stable rental rates.

The "newness factor" is significant: tenants increasingly prefer newly completed condominiums with modern facilities over older stock, even as the broader market softens. This preference creates a two-tier rental market where newer developments command premium pricing while older resale properties face downward pressure.

Tenant Preferences and Lifestyle Trends

In 2026, standard unit types no longer suffice. Tenants increasingly value flexible layouts, home office spaces, smart-home features, and community amenities. Properties offering dual-key units, optional partitions, integrated IoT, and co-working areas command rental premiums. Walkable neighbourhoods near healthcare, recreation, childcare, and transit hubs are becoming non-negotiable for many tenants.

These market shifts mean that rent increase justification increasingly depends not just on time elapsed, but on property quality, amenities, and location desirability. A well-maintained unit in a desirable location with strong amenities can support higher increases than an older property with limited facilities.

Legal Framework for Rent Increases in Singapore

Singapore has no rent control legislation. The market determines rental prices, and landlords have considerable freedom in setting rents. However, this freedom comes with important contractual and common law obligations that protect both parties.

No Statutory Rent Control

Unlike some jurisdictions, Singapore imposes no legal caps on rent increases. There is no requirement to limit increases to a percentage of previous rent, and landlords may increase rent to any level they deem appropriate. This market-driven approach reflects Singapore's commitment to economic efficiency and property rights.

However, freedom to increase rent does not mean freedom from consequences. Excessive increases may prompt tenants to vacate, resulting in vacancy periods, re-letting costs, and potential loss of income—often exceeding the benefit of the higher rate.

Contractual Obligations

Tenancy rights in Singapore derive from the lease agreement and common law principles. Your lease agreement is your primary legal document. Most standard leases include renewal clauses specifying how rent adjustments will be handled. Common provisions include:

• Fixed renewal rent: Rent remains unchanged upon renewal
• Market rate adjustment: Rent adjusts to current market rates, often with a specified percentage cap
• Indexed adjustment: Rent increases by a fixed percentage or formula (e.g., 3% annually)
• Negotiated adjustment: Parties agree on new rent at renewal time

Your lease terms control the renewal process. If your lease specifies that rent "shall be negotiated at renewal," you cannot unilaterally impose an increase; you must negotiate in good faith. If your lease permits "market rate adjustment," you have more flexibility, though you must demonstrate that the proposed rate reflects genuine market conditions.

Common Law Principles

Singapore courts apply common law principles to tenancy disputes. Key principles include:

• Good faith: Both parties must act reasonably and honestly in lease negotiations
• Mitigation of loss: If a tenant vacates due to an excessive increase, you cannot recover lost rent if you fail to re-let the property promptly
• Estoppel: If you have consistently accepted rent at a certain level, you may be prevented from suddenly demanding a higher rate without notice or negotiation

Stamp Duty Considerations

When renewing a tenancy, you have two options: renew the existing lease or execute a new lease agreement. This distinction has important tax implications. If you execute a new lease (rather than simply renewing the existing one), stamp duty applies at 0.4% of the annual rental amount for leases of one year or more.

For example, a new $3,000 monthly lease ($36,000 annually) incurs stamp duty of approximately $144. While this is modest, it's a cost to consider when deciding whether to execute a formal new lease or simply renew existing terms.

HDB-Specific Rules

If you own an HDB flat and are subletting it, additional regulations apply. HDB imposes specific requirements on subletting, including limits on subletting duration and restrictions on rental income. Consult HDB's subletting guidelines and consider our detailed guide on HDB Subletting Deposit Rules & Compliance Checklist | Homejourney before proposing any rent increase on an HDB sublet.

Determining a Fair Rent Increase

A "fair" rent increase balances three considerations: market conditions, property value, and tenant relations. Increases that are too aggressive risk vacancy and tenant loss; increases that are too modest leave money on the table.

Factors Supporting Higher Increases

Several factors justify larger rent increases:

• Property improvements: Renovations, upgraded amenities, or new facilities (air conditioning upgrade, smart home features, renovated kitchen) justify increases of 5-15%
• Market appreciation: If comparable properties have increased significantly in rent, your property may warrant a similar adjustment
• Inflation and cost increases: Rising property taxes, maintenance costs, and utility expenses justify modest increases (typically 2-4% annually)
• Strong tenant demand: Properties in high-demand locations (near MRT, CBD, expat-friendly neighbourhoods) can support higher increases
• Lease duration: Longer leases (3-5 years) typically justify smaller annual increases; shorter leases (1-2 years) may support larger increases at renewal
• Tenant quality: Reliable, long-term tenants warrant smaller increases than the market might support; retaining quality tenants often yields better long-term returns than maximizing short-term rent

Factors Supporting Modest or No Increase

Conversely, several factors suggest caution with aggressive increases:

• Vacancy risk: If comparable units are available at lower rates, tenants will move. In a market with 6.9% vacancy rates, this risk is real
• Aging property: Older buildings without recent renovations struggle to command large increases
• Tenant tenure: Long-term, reliable tenants are valuable. Losing them to a 15% increase that results in a 2-month vacancy is economically irrational
• Market softness: In segments facing downward pressure (older resale properties, landed homes), increases should be modest or zero
• Location disadvantages: Properties in less desirable locations, far from transit or amenities, have limited pricing power

Benchmark Increase Ranges

Based on current Singapore market conditions, consider these benchmarks:

These ranges reflect current market conditions as of early 2026. They are not prescriptive but rather indicative of what the market will bear. Your specific property's circumstances may justify increases above or below these ranges.

Conducting Market Research: Finding Comparable Rental Rates

Before proposing any rent increase, conduct thorough market research to understand what comparable properties command. This research serves two purposes: it ensures your increase is defensible, and it provides data to present to your tenant during negotiations.

Identifying Comparable Properties

Comparables should match your property on key dimensions:

• Location: Same district or immediately adjacent districts; proximity to MRT, CBD, or other key amenities
• Property type: Condo vs. landed; unit size and configuration
• Age and condition: Similar age and renovation status
• Amenities: Similar facilities (gym, pool, concierge, security)
• Lease terms: Similar lease duration and flexibility

Avoid comparing your 2-bedroom condo in District 15 to a 3-bedroom landed property in District 9. The comparison must be genuinely comparable to be credible.

Research Sources

Multiple research sources provide rental data:

• Homejourney rental search: Browse Property Search to identify comparable units currently available for rent in your property's location and price range. Filter by district, property type, and size to find direct comparables. Homejourney's verification process ensures rental information is accurate and current, giving you confidence in your market analysis
• Recent rental transactions: If you know the rental rates of comparable units that have recently renewed or been re-let, this data is invaluable. Speak with property agents who specialize in your area
• Property agent insights: Connect with agents through Homejourney's agent network who can provide market commentary on rental trends in your specific location
• Development-specific data: If your property is in an established development, analyze rental trends within that development. Gallery 8, for example, has maintained stable 1-bedroom rental rates at $2,900/month from May 2024 through December 2024, with 23 rental transactions since completion, indicating healthy market demand
• District-level trends: Understand whether your district is experiencing rental growth, stability, or softness. Districts with strong employment centers and transit access command premium growth

Analyzing Market Data

Once you've gathered data, analyze it systematically:

1. Calculate average rent: For comparable properties, calculate the average monthly rent per square foot or per unit type
2. Identify range: Note the high and low rents for comparables; your property should fall within this range
3. Assess positioning: Is your property at the high end (premium amenities, excellent location), middle (standard amenities, good location), or low end (basic amenities, secondary location) of the comparable range?
4. Calculate implied increase: If comparables rent for 5-10% more than your current rate, this suggests your market supports a 5-10% increase. If comparables rent for less, this suggests caution with large increases
5. Account for time: If your last comparable data is 6 months old, adjust for market changes since then

Documentation for Tenant Negotiations

Prepare a brief summary document showing:

• 3-5 comparable properties with similar specifications
• Current market rent for each comparable
• Your property's current rent and proposed new rent
• Justification for the increase (market appreciation, property improvements, inflation)

This documentation demonstrates that your increase is market-based, not arbitrary. It significantly improves tenant receptivity to the proposed increase.

Negotiation Strategy and Timing

How you approach rent renewal discussions significantly impacts outcomes. Strategic timing, clear communication, and good faith negotiation maximize the likelihood of successful renewal at improved terms.

Timing: When to Initiate Renewal Discussions

Initiate renewal discussions 3-4 months before the lease expires. This timeline provides:

• Adequate notice: Tenants have time to consider options without feeling pressured
• Negotiation window: If your initial proposal is rejected, you have time to negotiate and reach agreement
• Contingency planning: If renewal fails, you have time to market the property for new tenants

Avoid initiating discussions within 1-2 months of expiry; this creates pressure and reduces negotiation flexibility. Conversely, initiating too early (6+ months) may seem premature and create unnecessary uncertainty.

Communication Approach

Frame renewal discussions professionally and positively:

• Lead with appreciation: "We've greatly valued you as a tenant. Your reliability and care of the property are exemplary."
• Present market data: "We've researched comparable properties in the area. Current market rates for similar units are..."
• Justify the increase: "The proposed increase reflects market appreciation and our investment in property maintenance."
• Offer flexibility: "We're open to discussing the terms. Would a longer lease term with a smaller annual increase work better for you?"

Avoid language that sounds arbitrary or punitive ("Rents have gone up everywhere" or "We need more money"). Frame the increase as market-driven and reasonable.

Negotiation Strategies

1. Anchoring with Data

Present your market research first. "Based on comparable properties in this area, market rent is $3,200-3,400. We're proposing $3,150, which is below market." This anchors the discussion in objective data rather than subjective demands.

2. Offering Trade-offs

If tenants resist the increase, offer trade-offs:

• Longer lease term (3 years instead of 2) in exchange for smaller annual increases
• Smaller immediate increase (3% now, 3% in year 2) in exchange for a larger increase in year 3
• Lease renewal at current rate in exchange for accepting a larger increase in the next renewal cycle

These trade-offs can satisfy both parties: tenants get certainty and lower immediate increases; you get improved long-term rental income.

3. Emphasizing Tenant Retention Value

Quantify the value of retaining the tenant: "Finding and onboarding a new tenant typically costs us $500-1,000 in agent fees and takes 2-3 months. By renewing with you at a reasonable rate, we both avoid these costs and disruption."

This reframes the negotiation from "How much can I extract?" to "What rate keeps us both happy?"

4. Conditional Increases

Propose increases conditional on tenant actions:

• "If you extend to a 3-year lease, we'll limit increases to 2% annually"
• "If you handle minor maintenance (changing air filters, fixing minor issues), we'll cap the increase at 3%"
• "If you sign by [date], we'll honor the lower proposed rate; after that, we'll revisit based on market conditions"

Handling Tenant Resistance

If tenants reject your proposal, you have several options:

• Negotiate down: If your initial proposal was 8%, offer 5%. Present this as a compromise reflecting your appreciation for their tenancy
• Extend timeline: "Let's renew at current rate for one more year, then revisit in 12 months when we both have more clarity on market conditions"
• Accept their counter-offer: If they propose 2% and your minimum acceptable is 2-3%, accepting their offer preserves the tenancy
• Prepare for vacancy: If negotiations fail, begin marketing the property immediately. You may re-let at market rates, but factor in 1-2 months of vacancy and re-letting costs

Documentation of Renewal Terms

Once you reach agreement, document it immediately:

• Email confirmation: "This confirms our agreement to renew your lease at $3,100/month effective [date], for a term of [duration]"
• Formal renewal letter: Specify new rent, effective date, lease duration, and any modified terms
• Updated lease agreement: If terms have changed significantly, execute a formal renewal agreement

This documentation prevents misunderstandings and provides a clear record if disputes arise later.

Renewal vs. New Lease: Understanding the Difference

When a lease term expires, you have two options: renew the existing lease or execute a new lease agreement. This distinction has important legal and financial implications.

Lease Renewal: Continuing Existing Terms

A lease renewal extends the existing agreement for an additional term, typically with only the rent modified. The renewal:

• Preserves all existing terms and conditions (maintenance responsibilities, pet policies, guest policies, etc.)
• Maintains the same legal framework and protections
• Requires minimal documentation (often just a renewal letter confirming new rent and term)
• Incurs stamp duty only if the lease is for one year or more (0.4% of annual rent)

A renewal is appropriate when you're satisfied with the existing lease terms and only want to adjust rent.

New Lease: Fresh Agreement with Modified Terms

A new lease is a completely new agreement that may include modified terms beyond just rent:

• Allows you to update lease clauses (maintenance responsibilities, guest policies, pet policies, etc.)
• Provides opportunity to clarify ambiguous terms from the original lease
• Can incorporate new provisions (smart home responsibilities, parking allocation, etc.)
• Requires formal execution and incurs stamp duty (0.4% of annual rent for leases of 1+ year)

A new lease is appropriate when you want to modify terms beyond rent, or when the original lease has ambiguities you want to clarify.

Stamp Duty Implications

Both renewals and new leases incur stamp duty if the lease is for one year or more. The duty is calculated at 0.4% of the annual rental amount:

• $3,000/month lease ($36,000 annually): $144 stamp duty
• $5,000/month lease ($60,000 annually): $240 stamp duty

The stamp duty is the same whether you renew or execute a new lease. However, new leases provide the additional benefit of allowing you to update terms, which may justify the minimal additional administrative burden.

Practical Recommendation

If you're only adjusting rent and the existing lease terms are satisfactory, a simple renewal is efficient. If you want to update terms (e.g., clarify maintenance responsibilities, add provisions for smart home features, modify guest policies), execute a new lease. The stamp duty cost is modest relative to the benefit of having clear, updated terms.

Documentation and Legal Requirements

Proper documentation protects both you and your tenant by creating a clear record of agreed terms. It also ensures compliance with Singapore's legal requirements.

Essential Lease Renewal Documentation

1. Renewal Letter or Renewal Agreement

At minimum, provide written confirmation of renewal terms:

• Tenant name and property address
• New monthly rent amount
• Effective date of renewal
• Lease duration (e.g., "2 years from [date] to [date]")
• Any modified terms (if applicable)
• Signature lines for both landlord and tenant

Example language: "This letter confirms the renewal of the tenancy agreement for [Property Address] for a term of [duration] commencing [date], at a monthly rent of $[amount], payable on the [day] of each month."

2. Formal Renewal Agreement (for significant changes)

If you're modifying terms beyond rent, execute a formal renewal agreement that specifies:

• All terms of the renewed lease
• Effective date and duration
• Rent and payment terms
• Maintenance and repair responsibilities
• Guest and occupancy policies
• Termination and break clauses
• Any new provisions (smart home features, parking, etc.)

3. Stamp Duty Payment

If the lease is for one year or more, you must pay stamp duty within 30 days of lease execution. Stamp duty is calculated at 0.4% of the annual rental amount and paid to the Inland Revenue Authority of Singapore (IRAS). Failure to pay stamp duty can result in penalties.

Stamp Duty Payment Process:

1. Calculate annual rent (monthly rent × 12)
2. Calculate duty (annual rent × 0.004)
3. Pay duty to IRAS within 30 days of lease execution
4. Obtain stamped lease document from IRAS
5. Retain stamped document for your records

4. Rental Income Declaration to IRAS

As a landlord, you must declare rental income to IRAS. The new rental rate should be reflected in your annual tax return. Keep records of:

• Lease agreements and renewal documents
• Rent payment records (bank statements showing deposits)
• Maintenance and repair expenses
• Property tax and insurance payments

Consult a tax professional or IRAS directly if you're uncertain about your rental income tax obligations.

5. Tenant Communication and Record-Keeping

Document all renewal communications:

• Initial renewal proposal (email or letter with date)
• Tenant response and any counter-proposals
• Final agreement confirmation
• Signed renewal agreement or letter

This documentation protects you if disputes arise later about what was agreed.

Special Considerations for HDB Subletting

If you own an HDB flat and are subletting it, additional documentation requirements apply. HDB requires subletting approval and imposes restrictions on subletting duration and rental income. Before renewing an HDB sublet, consult HDB's subletting guidelines and review our detailed guide on HDB Subletting Deposit Rules & Compliance Checklist | Homejourney .

Balancing Rent Increases with Tenant Retention

The most successful landlords recognize that tenant retention often yields better long-term returns than maximizing short-term rent. A reliable tenant who pays on time, maintains the property, and renews repeatedly is worth more than a 10% rent increase that triggers vacancy.

Calculating the True Cost of Tenant Turnover

When a tenant vacates, you incur multiple costs:

• Agent commission: Typically 0.5-1% of annual rent ($180-360 for a $3,000/month unit)
• Marketing costs: Photography, online listings, advertising ($200-500)
• Vacancy period: 1-3 months of lost rent ($3,000-9,000 for a $3,000/month unit)
• Turnover costs: Cleaning, minor repairs, painting ($500-2,000)
• Tenant screening: Background checks, reference verification ($100-300)
• Total cost: $4,000-12,000+ per tenant turnover

For a $3,000/month unit, a 5% rent increase ($150/month, or $1,800 annually) is offset by a single vacancy period. Retaining a reliable tenant at a modest increase often yields better returns than losing them to an aggressive increase.

Tenant Quality Assessment

Before proposing an increase, assess your tenant:

• Payment reliability: Do they pay on time, every month, without reminders?
• Property care: Is the property well-maintained? Have they reported maintenance issues promptly?
• Compliance: Do they follow lease terms (guest policies, noise levels, parking)?
• Tenure: How long have they occupied the property? Long-term tenants are more valuable than short-term ones
• Stability: Are they likely to remain in Singapore or relocate?

For high-quality tenants (reliable payment, good property care, long tenure), consider modest increases even if market conditions might support larger ones. The certainty and stability of a retained quality tenant is worth more than the risk of vacancy.

Retention-Focused Negotiation

When negotiating with valued tenants, emphasize retention:

• "You've been an excellent tenant. We want to keep you, so we're proposing a modest increase that reflects market conditions without creating hardship."
• "We're willing to offer a longer lease term with smaller annual increases to give you certainty and stability."
• "Let's find a rate that works for both of us. We'd rather keep you at a fair rate than go through the hassle of finding a new tenant."

This approach often results in acceptance of reasonable increases that tenants might otherwise resist.

When to Accept Below-Market Rates

In some circumstances, accepting below-market rates makes economic sense: