4-room HDB Rental (Toh Guan @ Jurong East): Year 2022 update

• 4-room flat, 90 sqm (968 sqft) purchased in June, 2009 for S$355,000 (S$367 PSF).
• Renovation started on Dec 11, 2009 until January 24, 2010.
• Private bank housing loan was fully paid/redeemed on August 1st, 2014.
• Self-stayed for 7 years & 10 months until October 13, 2017.
• The HDB unit was rented out since November 5, 2017 until today.

(1) Tenancy agreement was renewed for the second time (total 52 months to be exact as tenant ended the tenancy 2 months in advance) with the same rate of S$2,150. Rental yield: 7.27%.

 The 3rd tenancy agreement ended on February 28, 2022.

New tenant found with 2 years contract, starting on March 1, 2022, with new monthly rental of S$2,800. New Rental yield: 9.5%.

(2) Total rental income to be received for 4x tenancy contracts, total 76 months (until Feb 2024) will be : S$179,000

52x S$2,150 = S$111,800

24x S$2,800 = S$67,200

(3) Miscellaneous charges:

- Yearly rental income tax (through additional personal income tax): at least one month of rental:

S$2,150 x 4.33 years ~= S$9,309 (52 months = 4.33 years)

S$2,800 x 2 years ~= S$5,600

Reality (estimated): S$19,413

- Monthly town council fees of S$79.50 x 76 months = S$6,042

- Real estate agent fees paid: S$1,150 (2017) + S$1,613 (2019) + FREE (2020) + S$2,996 (2022) = S$5,759

(I engaged tenant directly for 3rd tenancy agreement renewal with the consent from the real estate agent.)

- Property tax S$449 (2017-prorated) + S$960 x 4 (year 2018-year 2021) + S$1014 x 2 (year 2022- year 2023) = S$6,317

- Changed a new Daikin System 4 air con S$2,780 on June 27, 2019.

- Toilet repair done by HDB on March 1st, 2019, S$339

- Touch-up/furnishing cost on November 5th, 2017, S$1,800

- Touch-up/new kitchen hob, February 18, 2022, S$1,753

Total cost: S$44,204 (up to Feb 2024).

(4) Net gain: S$179,000 - S$44,204 = S$134,796. (38% of the purchase price) for 76 months = 6.33 years.

Net rental yield: 6%

The flat still has 74 years lease (counting from year 2024 until lease expired, year 1999 flat).

(possibly additional rental income of: 74 years x 12 months x S$2,800 = S$2.486 million)

Each year of rental will bring a net gain of S$21,294 (S$1,774 net monthly gain).