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Nov/Dec 2017 Issue
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Planning to Sell or Buy a Property? Protect Yourself!

If you are looking to sell your home or search for one through a property agent, use one of the Council for Estate Agencies (CEA)’s prescribed estate agency agreements.

These agreements formalise the contract between you and the property agency that your agent represents. It sets out the agent’s scope and duties as well as the terms and conditions involved when the agent acts for you.

CEA’s prescribed estate agency agreements are binding. There are two types of agreements:

  1. Exclusive agreements: You appoint only one property agency during a validity period of up to three months
  2. Non-exclusive agreements: You appoint a few property agencies to help you with your transaction

You can choose to use either type of agreement, depending on your needs and preferences.

The agreements protect the interests of both the consumers and the property agencies. They provide the following details:

Duties of the property agency and agent’s duties

You will have a clear idea of what the property agency and agent are supposed to do when facilitating your sale or purchase transaction

Any potential conflict of interest

The property agency and agent must declare to you in writing whether there is any potential conflict of interest ahead of the transaction.

Commission amount

If you have decided to engage an agent after negotiating and agreeing on the commission amount, do indicate this amount in the agreement. If GST is levied on the commission, your agent should reflect this in the agreement as well.

Do remember to pay the commission to the agency, not to the agent, and only when the transaction is completed.

When to pay or not pay commission

If you have signed an exclusive agreement, you will be liable to pay commission:

  • during the validity period even if you sell or buy the property through another agency or completed the transaction on your own, and
  • within three months after the validity period if the property is transacted with a party introduced by your appointed agency during the validity period.

The property agency and agent must go for a dispute resolution if you ask for it

CEA’s prescribed estate agency agreements enable you to use CEA's Dispute Resolution Scheme if you encounter any contractual disputes with your property agency or agent. You can then choose to go for mediation or arbitration through centres approved by CEA.

Infographic on the different components in the estate agency agreement for sale and purchase transactions
Infographic on the different components in the estate agency agreement for sale and purchase transactions

Did you know that CEA also provides prescribed estate agency agreements for rental transactions?