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Security Deposit In Singapore

What is a Security Deposit?

A security deposit is a one-time, refundable sum of money that a landlord would typically collect from a tenant to safeguard a landlord financially from damages to a rental or leaves unexpectedly without paying rent, whereby a landlord can then off-set from the said security deposit. This security deposit is then refunded to the tenants when the rental period expires

How Much Can My Landlord Ask For?

Although it is not required by law, it is typically for landlords in Singapore to collect a security deposit that is equivalent to one or two months’ rent for every one month worth of rent for every one year of lease. Often, this is decided by the landlord and negotiated with the tenant. Depending on price of the property, and furniture and tenants, take for example, a property that is rented to a group of students, that may be considered high-risk, the landlord may ask to secure a higher amount of security deposit.

The purpose of security deposit

During a lease, the property is entrusted to the tenant. However, landlords may find themselves in various situations, with the most common being the non-payment of rent to property damage. Thus, the security deposit is meant to offer to the landlord a financial safety net to mitigate any risks or losses in relation to the lease.

Should any deductions made by the landlord due to damages to the rental property during the tenancy period or unpaid rent, the landlord can set-off the monies used to rectify the damages or rent and the balance of the security deposit, if any, is returned to the tenant.

Can My Landlord Deduct From Security Deposit For Wear And Tear?

Whilst there is no legal specification as to “wear and tear” in Singapore law, ordinary ‘wear and tear’ includes small scuff marks on walls, or the reasonable wearing down of furniture, such as a blown light-bulb or reasonable fraying of carpets. The landlord typically would compare the condition of the property pre-tenancy and post-tenancy. Generally, these would not constitute as damages to the property to amount to a deduction of the security deposit. It is for the landlord to bear the cost of routine refurbishment, such as painting of the walls.

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Will The Security Deposit Be Refunded To Tenants?

Generally, tenants can recover the security deposit upon the return of property in a satisfactory condition, in accordance to the tenancy agreement. It is thus important for tenants to keep a record of photographs, videos and list or note in writing the original condition of the property during the take-over to minimise any potential disputes with the landlord over the original condition of the property.

Should there be any damages to the property and furniture or appliances during the take-over of the property, these should be highlighted to the landlord. It would be advisable to have it in writing and signed by the landlord and tenant as to the state of the property originally. For good order, tenants ought to also take an inventory of all furniture and appliances provided by landlord.

During post-tenancy, tenants and landlords can then refer to the documents, photos and videos taken pre-tenancy to avoid any disputes during inspection before handing over the property. As a way to secure the return of the security deposit, it is advisable for tenants to have confirmation from the landlord in writing that the property is returned in a satisfactory manner and that there are no outstanding monies due to the landlord, before returning the keys of the property.

Is Placing A Security Deposit With The Landlord Compulsory?

It is common practice for landlords to request for security deposit to be placed with them during the tenancy period. Whilst there are some services in Singapore offering schemes for properties that does not require a security deposit, that may not be a norm with the majority of rental properties in Singapore.

Should you find that the security deposit being asked for is unreasonable, or wish to ensure that refund of the security deposit, it would be advisable for one to consult a lawyer.

At Emerald Law we have lawyers who are experienced in handling  landlord and tenancy related matters in Singapore. Contact us so that we can schedule a free consultation for you in order to advise you on your matter.

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Our specialised lawyers and their team are standing by to assist you. Our first consultation is free.

The information contained within this website contains general information about our lawyers, Law Firm and procedures and is not intended to constitute legal advice.
Any person viewing or receiving information from this Website should not act or refrain from acting, on the basis of any such information without first seeking appropriate legal advice.
Please consult a lawyer for specific review of your case and advise. 

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