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The High Costs Of Selling A Property In Singapore: Here’s What’s Happening On The Ground

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Ryan J

A seasoned content strategist with over 17 years in the real estate and financial journalism sectors, Ryan has built a reputation for transforming complex industry jargon into accessible knowledge. With a track record of writing and editing for leading financial platforms and publications, Ryan’s expertise has been recognised across various media outlets. His role as a former content editor for 99.co and a co-host for CNA 938’s Open House programme underscores his commitment to providing valuable insights into the property market.

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Martin
Martin
5 months ago

just curious, why can’t developer do direct sale without going through agent? and pass on the discount to buyers. In Malaysia Developers are doing direct sale (you can buy directly from developers)

Stacked Homes
Admin
5 months ago
Reply to  Martin

There are a few agencies in Singapore that are quite big. For a developer to bypass the very agents they hire could send a signal that they cannot be trusted. If a large agency boycotts a developer, they could lose out on future marketing. Thus, it’s not that the developers don’t wish to save money or pass it on, it’s about their relationship with the agencies.

Martin
Martin
5 months ago
Reply to  Stacked Homes

i see, but as a buyer, i don’t really see the value added by agency for new launch, and you mentioned it’s more than resale (up to 5%), All i need is first hand info from developer such as floor plans, site plans, maintenance fee, etc, and a visit to the actual site and showroom, if given a choice i would prefer the savings compare to buying through agent and pay the 5% comm. I don’t see why reputable developers like Guoco, Keppel, Capitaland etc need to succumb to agency.

Stacked Homes
Admin
5 months ago
Reply to  Martin

Hi Martin! It’s ultimately all about marketing, as every new launch is competing for a share of voice in the market. It’s the same with most businesses where there’s competition. Some buyers, like yourself, do the research and head down to the showflat. They know their financial numbers, timelines, and so on, so you may not be the target audience. But many others depend on a professional to guide them and make recommendations. Agents are also motivated by the commissions to sell, so they invest their own resources to churn out ads to promote the development. Ultimately, it helps amplify the messaging. If a developer has 5 years to sell a new launch before they have to forfeit the ABSD, they’d be even more motivated to have a greater share of voice in the market. This is why the practice continues. We’ve written about it in detail here. Of course, if there was a site with all new launches and potential buyers could browse all the information they need there, that would be perfect. But that’s a whole new business of its own, and trying to garner a larger share of voice in the online space is very difficult. We have such a portal here, but if it’s not widely known, then the agencies still hold sway over the buyer’s market.

Kell
Kell
4 months ago
Reply to  Martin

Firstly, new launch never gets 5% comm. It is usu between 1% and 2%.
5% only appears when developer has many units left to sell. In tandem, the selling price will increase from launch date.

Because if developer drop prices for unsold units, eventually no buyers will buy on launch day. (who will buy on launch day if there is a high chance of price drop later?) So they increase price, and give it to agents to entice agents to sell the unsold units.

By paying comm, all the agencies and agents will promote for them free. If they do it themselves, they need to employ lots of people. Do developers want this hassle?
Frankly there will likely be no discount to buyers even if they sell direct.

Lastly there is one developer who often sells without agencies, and that is Far East. They have their full time in-house agents working for them.

Do you know what are the condos Far East are selling except Reserve Residences? Probably not as nobody promotes them (comm was given for Reserve)

Most agents will direct their buyers AWAY from Far East condos as agents get no comm.
That is why Far East has condos that are never fully sold even after 10 years. (go check their website)

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