14 NOVEMBER 2023
Singapore Estate Agents Association (SEAA) is proud to announce the signing of two Memorandums of Understanding (MOUs) at our Singapore KEOs and Leaders Conference 2023 held at Lifelong Learning Institute, Lecture Theatre on 14 November 2023. These agreements mark a significant step towards fostering cooperation and setting a new milestone in the real estate agency industry and SEAA is excited to be at the forefront of these collaborations.
The event was attended by Guest-of-Honour, Associate Professor Muhammad Faishal Ibrahim, Minister of State, Ministry of Home Affairs & Ministry of National Development. It also brought together key players and stakeholders from the real estate agency industry to witness the official signing of the two MOUs that seek to shape the future of the industry in Singapore.
Signed between SEAA and the Law Society of Singapore, this MOU promotes the usage of the Law Society of Singapore’s ADR (alternative dispute resolution) Schemes, including their Mediation and Arbitration Scheme by SEAA Members, for all disputes arising from Co-broking arrangements between Property Agencies and Property Agents. Partnering with Law Society, SEAA members will be able to adopt this resolution schemes at affordable rates.
Signed between SEAA and selected Property Agencies (see Annex 2), this MOU covers the following:
1) Co-operation & Collaboration
SEAA shall partner the Property Agency in offering one-year complimentary Associate Membership to all their Property Agents
2) Dispute Resolution Scheme
It seeks to promote and further use of the mediation and arbitration schemes offered by SEAA and its appointed Dispute Resolution partner, Law Society of Singapore as first port of call for all disputes arising from Co-broking arrangements between Property Agencies and Property Agents. This is with effect from 01st January 2024
When a commission dispute arises between property agents especially from different agencies, it is sometimes difficult for both the agencies to handle on the salesperson’s behalf as large part of the commission goes to the salespersons and their stakes are higher. Together with the Law Society of Singapore, SEAA as a leading industry association could step in to facilitate to resolve such disputes when the agencies are in the difficult position to do so.
3) Best Practice Guide on Co-broking Commission
For Property Agencies and all their Property Agents to adopt best practice guide on co-broking commission, with effect from 01st July 2024. Please refer to Annex 1, Document no: BPG/SEAA/2023/10/28.
There is no uniformity in the current practice of how property agents are renumerated which causes pain points. For example, in some sale transactions, the seller will pay the commission to the property agent representing them. As for the buyer, it is up to their discretion if they want to pay commission to the property agent who represents them. If the buyer does not pay the commission to their property agent, then their agent will negotiate with the seller’s agent to share the commission. This creates potential conflict of interest as the buyer’s agent is now in the dilemma of deciding to put the clients’ interest first or to protect their commission. The same applies for rental transactions.
In many other jurisdictions around the world, the concept of real estate representation is very clear; Agents should collect commission from who he or she represents, i.e., Seller’s agent to collect from seller, Buyer’s agent to collect from the buyer. The same applies to tenancy commission, Landlord’s agents will collect from landlords, and Tenant’s agents from tenants. This is the arrangement the MOU seeks to achieve.
SEAA’s President, Mr Adam Wang, expressed his excitement about these partnerships: “We are thrilled to be joining hands with Law Society of Singapore to offer mediation and arbitration schemes to our members. These schemes can help our members save time and costs as well as achieve better outcomes for any disputes they may face between property agents or property agencies on co-broking matters.
As for the MOU with the Property Agencies, we are advocating the industry to work together as one and getting property agents renumerated by the clients they represent. This recommended practice will help to resolve long-standing issues and we would like to thank all the property agencies involved for their support. We look forward to a future of exciting developments in our industry.”
President of Law Society, Mr Jason Chan SC said “Law Society of Singapore is excited to work with SEAA to offer our mediation and arbitration schemes to their members. The schemes are designed to resolve the disputes quickly and efficiently. All our panels comprise experienced, accredited legal practitioners who possess a deep understanding of the industry.”
Mr Lim Yong Hock, KEO of PropNex voiced “We are happy to see SEAA take the lead in gathering the Property Agencies in the industry to adopt best practice guide on co-broking commission. This move will address many issues in the industry and bring about more opportunities for the property agents.”
KEO of ERA, Mr Eugene Lim said “It is always not easy to change current practices and mindsets of the stakeholders. However, change is a necessity if it is for the betterment of the industry, and we see the best practice guide on co-broking commission as something we should work towards.”
The Singapore Estate Agents Association (SEAA) was formed to represent the property agencies and property agents in Singapore and is the leading industry association for the real estate agency industry. With the support from Council for Estate Agencies (CEA) and the major property agencies, SEAA aims to be a cohesively strong voice for property agencies and agents and to advocate and further their common interests.
Driven to promulgate and maintain the high standards of the real estate agency profession, SEAA ensures that the industry remains relevant and sustainable by promoting continuous learning, upgrading, ethical standards and professional development amongst its 6500 members. The Association also works closely with the regulatory bodies and stakeholders on industry initiatives that benefit its members. For more information, please visit www.seaa.org.sg
For further information, please contact:
Ms Teo Wanting
Senior Manager, SEAA