Should You Sell or Rent Your HDB After MOP? Here’s How to Decide.

Benice Lau - KakiHomes
Jun 5
3 min read

Updated: Jun 10

Congratulations — you’ve hit the 5-year Minimum Occupation Period (MOP) for your HDB flat. That means you can now sell it on the open market or rent it out for passive income. But which path actually makes more sense for your situation?

The answer depends on your goals, your financial situation, and how you see the market evolving.

🏠 Option 1: Sell Your HDB Flat

Selling can be the smarter move if you’re ready to upgrade or reposition your property portfolio.

✅ Why People Sell After MOP

Use the gains to upgrade A well-located BTO or resale flat bought five years ago could fetch you a tidy profit today. That can go toward a condo, executive condo (EC), or bigger resale flat.
You want to reset the lease clock Lease decay affects long-term value. Selling now lets you buy into a newer property with a full 99-year lease.
You’re making a strategic move Maybe you’re buying closer to work, better schools, or future MRT lines. Selling opens doors.

⚠️ What to Watch Out For

Resale Levy If you’re buying another subsidised flat (like BTO or new EC), you’ll need to pay a resale levy — $40k for a 4-room, $45k for a 5-room flat. This comes out of your proceeds.
Timing the move Selling first gives you certainty but might leave you without a home while waiting for your next purchase to complete. Buying first requires bridging loans or enough cash on hand.
Cash & CPF Flow After selling, CPF used must be refunded with accrued interest. Plan your next purchase CPF and cash needs carefully.

🛋️ Option 2: Rent Out Your HDB Flat

If you already have another place to live — or are moving into a condo — renting your HDB can generate stable monthly income.

✅ Why People Choose to Rent

Strong rental marketAs of now, demand remains solid for HDB rentals, especially near MRTs or mature estates. Rental income of $2,800–$4,000/month (depending on flat type and location) is common.
Cashflow without sellingIf you’re emotionally attached or bullish on future resale prices, renting allows you to hold onto the flat while generating income.
Long-term playYou can always sell later. In the meantime, someone else is essentially helping you pay off the mortgage.

⚠️ What to Watch Out For

You must vacate To rent out the entire flat, you need to move into another property (e.g., private condo). You can’t rent out the whole unit and continue staying there.
Being a landlord You’ll need to manage tenants, maintenance, and downtime between leases. Alternatively, you can outsource this to agents (with a cost).
Rental income is taxable Net rental income (after allowable expenses like property tax, maintenance fees, and agent commission) is subject to personal income tax.

🤔 Still Not Sure? Ask Yourself These:

Do I need the funds from a sale to afford my next home?If yes, selling is likely the way to go.
Am I prepared to be a landlord?If not, renting may become a headache, not a side hustle.
Do I believe this flat has more room to appreciate?Flats in up-and-coming areas (near new MRT stations, amenities) may be worth holding.
How does it fit into my bigger life plan?Planning kids? Starting a business? Retiring early? Your flat can help fund those — if used strategically.

🧮 Quick Math Example

Let’s say your 4-room flat could sell for $620,000. After CPF refund, outstanding loan, legal fees, and agent commission, your net proceeds might be ~$280,000.

Alternatively, you could rent it out for $3,200/month = $38,400/year.In 5 years, you earn ~$192,000 (pre-tax, excluding vacancy and maintenance).

Now ask: would you rather have $280k now, or ~$160k–180k slowly — and still own the flat?

✅ Final Thoughts: There’s No One-Size-Fits-All

Both options have real value.If you're aiming to upgrade your lifestyle or portfolio, selling could fund the leap.If you're looking for cash flow and flexibility, renting could be the better hedge.