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Learn what the latest changes to guidelines for property agencies marketing homes abroad mean for consumers

CEA’s revised guidelines enhance the professional practices of agencies and agents marketing properties abroad, and better protect consumers.

Investing in foreign properties always seem enticing – with postcard-worthy images of swanky neighbourhoods along with promises of “guaranteed” investment returns.

Attractive as these may seem, buying foreign properties carries significantly higher risks that are not associated with Singapore property purchases.

In 2014, the Council for Estate Agencies (CEA) had put in a place a set of guidelines that local property agencies and agents must adhere to when they partner overseas developers in representing consumers who are considering buying properties abroad.

For example, local property agencies are required to conduct several preparatory checks on the overseas developer and its claims before marketing the property to consumers in Singapore. The property agents marketing the properties must also undergo project-specific training to ensure that they can provide buyers with accurate advice and information.

Recently, CEA revised the guidelines to enhance the professional practices that property agencies and agents have to adopt in the sale and marketing process of properties located outside Singapore. The revised guidelines, which came into effect on 1 December 2018, will also better protect consumers.

If you are working with a local property agency that is marketing a property outside of Singapore, here are some of the key changes that you should be aware of:

Take note of and sign the “Important Notice to Purchasers”

Property agencies must obtain a written acknowledgement from you, indicating that you are aware of the risks involved in buying overseas property, and that you should conduct your own checks as well.
  • Property agencies are now required to check if there is publicly available information on the overseas developer or the property that is adverse or potentially adverse.

    If available, this information must be conveyed to you in a notification, known as “Important Notice to Purchasers”. This Notice has to be presented to you in a format provided by CEA in our guidelines for property agencies and agents marketing foreign properties.

  • The “Important Notice to Purchasers” also includes an advisory message to consumers that there are risks involved in purchasing property overseas properties, and that you should conduct your own due diligence as well.

    Apart from providing this advisory to you, property agencies are now required to obtain a written acknowledgement from you, indicating that you are aware of the content of the notice before proceeding with the transaction.

    So be sure to raise any questions you have regarding the content in Notice and sign it only if you agree with the terms.

Property agencies and agents must arrange for you to sign the relevant documents between you and the overseas developer

If the documents you are required to sign with the foreign developer are not in English, property agencies must present you with a translation of the content.
  • Property agencies and agents are required to facilitate or arrange for you to sign the relevant transaction documents between you and the foreign developer.

    If these documents are not provided in English, property agencies must obtain an English translation from reasonably qualified translators and provide the translated documents to you before you sign them.

    Again, we encourage you to understand and clarify the content of these documents before signing on the dotted line.

Property agencies must confirm that guarantees made in advertisements are binding on the foreign developer

  • Property agencies must confirm that guarantees made in advertisements are binding on the foreign developer e.g. return on investments (ROI) are binding on the developer. The agencies must also obtain from the developer the contractual documents providing these guarantees and review them. If the figures indicated in the advertisement are not current data, then the date and time of the data must be stated in the advertisement e.g. ROI from <year>.

Buying a property located overseas is no less a smaller or easier decision than purchasing a home locally. It still involves a substantial financial investment, and comes with greater risks.

Do note that even if you are working with a local property agency appointed by a foreign developer to guide you through the transaction, it is still important that you do your own checks before you commit to an overseas property purchase.

For more tips on buying foreign properties: