390 illegal short-term rentals at HDB flats, over 1,800 at private homes reported between 2015 and 2017

SINGAPORE – There were 390 reports of unauthorised short-term stays in Housing and Development Board (HDB) flats, and 1,808 reports in private residential units between 2015 and 2017, said National Development Minister Lawrence Wong in Parliament on Wednesday (July 11).

Mr Wong disclosed these figures in response to questions tabled by Members of Parliament (MPs) on the public consultation on short-term home rentals – such as through home-sharing sites like Airbnb – and the impact these short-term leases has on the hospitality industry.

Under current rules, it is illegal to rent out HDB flats for less than six months. For private homes, it is illegal to rent them out for less than three months unless the owners have obtained permission from the Urban Redevelopment Authority (URA).

A public consultation exercise was conducted between April 16 and May 31 this year to gather feedback on their proposed regulatory framework for short-term accommodation in private residential properties.

One of the proposals suggested that private residential properties owners only be allowed to lease out their apartments for short-term stays if they have at least 80 per cent approval — calculated in terms of share value — from owners at the development.

But Mr Wong said on Wednesday that there was a “mixed response” to the proposal. Some felt that the 80 per cent threshold was unfair to the minority who do not support short-term accommodation and will have to accept these guests in their developments.

Others felt that the threshold was too high and it would be hard to obtain sufficient support, he noted.

“The URA is now in the process of carefully studying all the feedback that we have received and will do so before deciding on how to take this issue forward, including how to structure the final regulatory approach, and whether there is a need for any legislative amendments,” said Mr Wong.

A check with URA revealed that in the first half of this year, there have been about 400 reports of unauthorised short-term stays in private homes that were investigated.

Responding to a question from MP Lee Bee Wah’s (Nee Soon GRC) on the impact of short-term stays on rental and property prices, Mr Wong said the authorities have studied the phenomenon in other property markets and realised that they “put an upward pressure” on these prices.

“We are mindful that these may have an impact. That’s why… we are not rushing to make changes, we are studying the matter very carefully. If and when we choose to do so, we will make sure that there are indeed appropriate safeguards,” he added.

Dr Lee had earlier also asked about the impact of short-term stays on the hospitality industry, to which Mr Wong said the authorities have considered this very carefully and the proposed regulatory framework includes controls that are similar to those on the hospitality industry, such as collecting and recording the personal details of their guests, among other things.

“The intent is to provide a more level playing field between the short-term accommodation sector and the hospitality industry,” said Mr Wong.

Dr Lee then raised a supplementary question about whether allowing short-term leases would be unfair to those who have made investments into the hospitality sector, which the minister said the authorities’ approach was based on “fair competition”.

“It's not possible to say let's block any new entrants into the hospitality sector simply on the basis that the existing incumbents have put in investments,” he said.

On residents’ complaints that the URA takes too much time to investigate and stop owners from illegally renting out their units for short-term stays, a question raised by MP Melvin Yong (Tanjong Pagar GRC), Mr Wong said he would ask the URA to make sure they have sufficient resources to take enforcement action and that they are done expeditiously.