Longer rent commitment for HDB shops may prevent overbidding

But analysts caution that tenderers may still bid aggressively for those in prime locations

-  Isabelle Liew

Requiring successful bidders for HDB shops to commit to their tendered rent for a longer term could help to curb speculative bidding, said property analysts.

It would help to prevent tenderers from overbidding in the hope that rents would be reduced in the next tenancy term.

But analysts cautioned that the move may not guarantee sensible bidding, as tenderers may still bid aggressively to secure shops in prime locations with high footfall.

The Housing Board announced on Jan 10 that bidders are required to commit to their tendered rent for two tenancy terms - a total of six years instead of one three-year term if they choose to renew their leases.

It applies to those who successfully bid for any HDB shop, including coffee shops and medical facilities, to encourage prudent bidding.

This comes on the back of concerns over rising rents, after a general practitioner's clinic in Tampines was rented out at $52,188 a month in 2025 when a healthcare services firm placed the record-high bid with HDB.

Professor Sing Tien Foo, provost's chair professor of real estate at NUS Business School, said HDB's latest move will give bidders greater certainty about long-term rent while avoiding short-term rent fluctuations.

"It will rule out speculative behaviour by tenants, who may overbid to gain entry to the shop, hoping the rent will adjust downward when the lease is renewed in the second term," he said.

However, Prof Sing noted that bidding behaviour would still depend on the demand for an HDB shop unit.