The rental market in Singapore has been making the rounds in the news lately (2021 and 2022). This can be attributed to the increased demand for condo rentals and the borders being reopened for expatriates. Despite this increase in demand and rise in prices of HDB rentals, the interests of individuals, couples, and families haven’t been dampened in any way. One thing that comes to mind for many individuals is the different types of flats and how much is needed to afford them. Let’s take our time to look at the different types of flats and how much monthly salary is needed to afford these flats.
Current prices for HDB flat rentals
If you are looking to rent an HDB flat it is important you know and understand the market of HDB rentals and their rates. Here is a quick compilation of 3, 4, and 5-room flats in Singapore based on the publications on the HDB website.
Median HDB Prices for Rental Flats (Quarter 2 2022)
Sources: HDB RENTAL STATS
- (-) No rental transactions in this quarter
- Asterisks (“*”) means cases with less than 20 rental transactions for that flat type or town.
- The median rent tells you that half of the units for that flat type in that town were rented above that price and half below.
- The figures are rounded to the nearest ten dollars.
The above stats give us a better view of the price ranges based on flat size.
These ranges are considered general prices for rentals for an entire HDB flat. Although other factors might play a role in making these prices higher or lesser than the stated price range. For instance, newer buildings might be pricier, and facilities close to amenities like MRT stations, choice schools, or bus interchanges might have a higher price.
Once you have gotten a hold of these prices you can then decide which flat type would work for you based on your budget. Now it’s time to decide how much of your income you need to put aside for your rental budget.
How much of your income is needed for the rental budget
A rule of thumb when it comes to budgeting for your rent is not to spend more than 40% of your income. Also, prepare for unexpected costs, fixed costs like Wi-Fi and utilities, and other expenses. Moreover, you want to keep some funds for your day-to-day spending, investments, emergencies, and personal care.
Always calculate the 40% against your take-home income after all necessary deductions. For instance, if your salary is $10,000 a month then your take-home is $8,000 which means you can budget $3,200 a month for your rent.
Different earnings to afford different HDB rental rates
Taking a look at the average rental prices we can conveniently estimate how much you need to earn to afford different flat types. We are assuming that your rent is 40% of your take-home income. The table below shows an estimate of the earnings.
HDB rates vary for different areas in Singapore but you can negotiate for an HDB that fits your budget. If the HDB rental flat is way out of your budget, you don’t have to worry – just take out time to search for cheaper units or you can share the rent with a partner or housemate. You can also rent just a room since HDB rooms are cheaper than taking the entire HDB flat. No matter the case, ensure to follow the rule of thumb when budgeting for your HDB rental – don’t spend more than 40% of your income.