Aellan Choo Real Estate Services

Letter of Intent (Understanding LOI in Singapore Real Estate)


Hey there! If you are a tenant in Singapore, it’s important to shed some light on the Letter of Intent (LOI). In this article, we’ll look into what LOI is, its typical use, why it matters, and what tenants should include when drafting one.

What's the Deal with the Letter of Intent (LOI)?

So, the LOI is basically a friendly, non-binding document used in real estate deals. It’s a way for tenants to express their interest in renting a property and kickstart negotiations with the landlord. It’s like a warm-up before the real lease agreement.

*Take note to add in “Subject to Contract” at the header of LOI so that this document does not become binding contract.

When Do We Use the LOI?

The LOI comes into play when tenants want to make their intentions crystal clear to the landlord. It sets the stage for discussion and allows both parties to agree on the basic terms and conditions before getting into the nitty-gritty of a formal lease agreement.


letter of intent

Why is the LOI Important?

  1. Getting on the Same Page: The LOI helps avoid any confusion by letting tenants and landlords lay out their expectations regarding rent, lease duration, renewal options, and other important stuff.

  2. Saving Time and Effort: By tackling the major terms upfront, the LOI saves everyone from wasting time and energy on negotiating a lease agreement that might not work out later on.

  3. Preparing for the Real Deal: The LOI acts as a blueprint for the final lease agreement, making it easier for the landlord agent to draft the Tenancy Agreement when the time comes.

Should We Mention "Subject to Contract"?

Absolutely! Including the phrase “Subject to Contract” in the LOI is vital. It ensures that the LOI is not legally binding and protects both parties from unintended obligations until the formal lease agreement is sealed.

What Should Tenants Include in the LOI?

When tenants draft their LOI, they should cover the following bases:

a. Tenant’s Details: Obviously, start with the tenant’s full name, contact info, and business details if applicable.

b. Property Specifics: Don’t forget to mention the property’s address, type, size, and any special requests or modifications.

c. Lease Terms: Lay out the proposed move in date, lease duration, rental amount, security deposit, and any options for renewal.

d. Extra Conditions: If there are any additional requirements, like Diplomatic Clause, Pet Clause, etc. 


In the world of Singapore real estate, the Letter of Intent (LOI) is a handy tool for tenants and landlords to establish initial terms before diving into a formal tenancy or lease agreement. By understanding the ins and outs of an LOI, tenants can effectively express their desires and negotiate key terms, making the renting process smoother. Just remember, the LOI isn’t legally binding (when you indicate Subject to Contract), and it’s always wise to have your tenant agent to review the final lease agreement to protect everyone involved.


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