In Singapore, there isn’t any kind of rules and regulations on how much commission a Property Agent should receive for any transaction but of course, there’s the “market practice” of the usual commission paid out. So, what are they?
In general, here’s the breakdown:
- Selling HDB Flat: Seller pays seller’s agent 2% commission + GST
- Buying HDB Flat: Buyer pays buyer’s agent 1% commission + GST
- Selling Private Property: Seller pays sellers agent 2% commission + GST which in turn the seller agent will share part of his commission with buyer agent.
- Buying Private Property: Usually buyers does not pay his agent a commission as his agent will collect his share from the seller’s agent. There’s no right answer out there as to why this is the case but it is.
- Landlord HDB Flat: Landlord pays his agent either a 1/2 month equivalent in rent as commission or a 1 full month equivalent in rent as commission + GST. It is either one depending on the length of lease taken up by the tenant.
- Landlord Private Property: Landlord pays his agent either a 1/2 month equivalent in rent as commission or a 1 full month equivalent in rent as commission + GST. It is either one depending on the length of lease taken up by the tenant. for commissions worth $3000 and above, the landlord agent will share his commission with tenant’s agent.
- Tenant HDB Flat: Tenant pays his agent either a 1/2 month equivalent in rent as commission or a 1 full month equivalent in rent as commission + GST. It is either one depending on the length of lease taken up by the tenant.
- Tenant Private Property: Tenant pays his agent either a 1/2 month equivalent in rent as commission or a 1 full month equivalent in rent as commission + GST. It is either one depending on the length of lease taken up by the tenant. But for monthly rentals of 2 years and rent exceeding $3000, tenant usually do not pay for commission. His agent will collect his share of commission from landlord’s agent. Why is this so? There’s no right answer out there. This is the general market practice.
So, do you really need an agent to settle your buying, selling & renting? It’s not necessary if you’re personally equipped with the right knowledge, have a lot of time on hand and is very conversant in property matters. But if you do not have any one of these qualities, then it is advisable to take up the services of a Property Agent. Buying or selling a house is probably on of the biggest financial decision you make in your life. You wouldn’t want to take the risk of something going wrong and cause yourself a lifetime of regret. Even for rentals, there’s many scary stories out there and they are all real. Things happen. You would not want to be in that helpless position.
The question many people ask, why do I need to pay so much? You do not need to pay so much all the time. You can always source for an agent who is willing to do it for you at the price you can afford. There’s more than 20,000 real estate salesperson in Singapore, you can definitely find one who’s willing to do it at your price.
Since the drop in HDB resale transactions in recent years, homeowners are facing difficulties selling their HDB flat. This resulted in lower selling prices which means lower profits. If you’re intending to move out, better start selling at least 3-4 months in advance. There’s many skilful agents out there who may be able to sell your flat within a month or 2 by adopting all the selling techniques possible out there. But these services don’t come cheap. These agents will ask for a 3-4% commission to sell your unit. Those who are really urgent, especially with less than 6 months less to sell their unit due to their next property move have no choice but to take up this exceptional service. But, it works.
The most challenging part of all is to find a sincere and trustworthy agent. Well, there’s many. You just need to look.
