Unsure of what to note when working with your property agent for sale and purchase transactions and how much commission to pay? Here are some useful tips.
Customer's Identification Details
Are property agents allowed to collect my NRIC or other identification details e.g. take photos or make photocopies of my ID)?
The Infocomm Media Development Authority has set up the Personal Data Protection Commission (PDPC). The PDPC's Advisory Guidelines on the Personal Data Protection Act (PDPA) for NRIC and other National Identification Numbers state that an organisation may collect, use, or disclose a person’s NRIC number with notification and consent, when it is necessary to accurately establish or verify the identity of the individual to a high degree of fidelity.
This applies to property transactions as the inability to accurately identify an individual to a high degree of fidelity may pose a risk of significant impact or harm to an individual and/or organisation.
As such, property agencies and agents can request to collect the NRIC, FIN, or Work Permit numbers of their clients, specifically for the purposes of facilitating property transactions. Property agents can take photos and make photocopies of the documents when necessary. The information collected should not be used for other purposes or shared with other parties not involved in the property transaction.
Commission Rate
How much commission should I be paying?
There are no fixed commission rates nor prescribed guidelines on commission amounts. We leave it to market forces to drive competitive pricing for commission payable in the industry. This incentivises property agents to price their services competitively.
You should discuss and agree on the commission amount and terms with your agent based on the scope of work you require before he starts work.
Do check if there is GST payable on the commission. You can document the agreed commission amount in the Prescribed Estate Agency Agreement. When the transaction is completed, honour and pay the agreed commission to the property agency, not to the agent himself.
Do take note that property agents cannot collect commission from more than one party in the same transaction. If your agent collects a commission from you, he cannot collect a commission or a co-broking fee from the other party or from the other party’s agent. Even if your agent has helped the other party with paperwork, he should not receive any fee from the other party.
Customer's Particulars Form
What is it and why do I have to fill it up?
CEA requires property agents to request their clients to fill in and sign the Customer’s Particulars Form. This is one of the measures agents have to take to combat money laundering and counter terrorism financing.
Investing in real estate is one of the ways criminals introduce ill-gotten funds into the legal economy. By identifying the parties involved in the property transaction, especially the beneficial owner, the authorities would be able to prevent money laundering from happening.
The Customer’s Particulars Form enables agents to gather the information needed to conduct the necessary checks, and the agent should not share that information with external parties except where necessary to facilitate the transaction. Cooperate with your agent and do your part by filling in the form.
Sale and Purchase Agreement
What is this Agreement and where can I find it?
The Option to Purchase (OTP) and Agreement for the Sale and Purchase (S&P agreement) documents contain general applicable clauses that govern the obligations of sellers and buyers for the sale and purchase of private residential properties. You can find the templates for these two documents on CEA’s website.
These templates are just a guide, and you can amend the templates or negotiate the terms contained in the documents with your agent to suit your needs and/or requirements.
The templates were drafted by the Digitalised
Property Transactions Workgroup (DPTWG) - a workgroup comprising industry representative from across the real estate value chain and all key government agencies with touchpoints in the property transaction process. The DPTWG gathered input from other regulatory agencies and industry practitioners who are experienced in the residential property transaction process, to ensure that the templates provide a common standard that is fair to all parties in the transaction.
For additional tips on engaging a property agent, visit www.cea.gov.sg/4steps
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