REITM Focus: New OTP and S&P agreement templates aim to save agents’ time, better protect interests
Standard contract templates for the Option to Purchase (OTP) and Sale and Purchase (S&P) Agreement for private residential properties are now available for download on the Council for Estate Agencies’ (CEA) website.
These templates aim to offer the following benefits to property agents who incorporate them in their work with clients:
- Time savings
- Increased productivity
- Offer of greater assurance to clients that their interests are protected
- Fewer disputes between clients and agents
The templates were drafted by the Digitalised Property Transactions Workgroup with input from other regulatory agencies and industry practitioners who are experienced in the residential property transaction process. Various views and feedback were taken into account, to ensure that that the templates provide a common standard that is fair to all parties in the transaction.
The templates contain:
- General applicable clauses that govern the obligations of sellers and buyers for the sale and purchase of private residential properties.
- Annexes within the templates that allow parties to add or vary terms to suit their needs and requirements.
While the templates are not mandatory, we encourage property agents to use them as agents can potentially save time from negotiating general contractual terms and conditions. The use of the templates may also help reduce disputes as their content is intended to balance and protect the interests for all parties involved in the transaction.
Besides the OTP and S&P Agreement templates, property agents can also download the standard tenancy agreement templates for HDB flats and private residential properties. These were earlier developed by the Workgroup as well.
The above templates are in PDF format on CEA’s website. Please contact CEA via this link if you would like to request for the templates in .docx (Microsoft Word) format.
Welcomed by the industry
Mr Wong Cheong Hong, Chief Executive Officer, Singapore Estate Agents Association, said that currently, different property agencies provide different OTP and S&P agreements to their clients. The new templates provide a common set of documents for agents as well as consumers to use in property transactions.
“Agents and their clients can now spend less time going through the documents and have a more efficient transaction process. The standard templates will also be helpful when the transaction process is further digitalised and documents can be executed electronically in future,” said Mr Wong.
Mr Adam Wang, Key Executive Officer of FER Properties Pte Ltd and President of KEO Connect, said that common templates are useful in setting "benchmarks" for the industry. He said that agents adopting these templates will be able to assure their clients that these contracts were developed with input from professionals across different segments of the real estate value chain, thus addressing misconceptions that such documents are one-sided.
Adding that some agents may not be familiar with the clauses in the OTP, Mr Wang suggested more training for agents in this respect. This would enable them to better understand the content of the clauses and annexes, and accurately explain them to their clients.
Mr Wang believes that agents who adopt the templates will be able to reap time savings. Also, with higher adoption rates down the road, property agencies and other real estate service providers could potentially see greater business value in investing to digitalise the contracts for secured electronic signing.