
According to the Council of Estate Agencies, commission is negotiable. But just when is commission payable and what are the market standard practices?
Sellers and landlords understand that when they engage an agent to market their properties, a fee is involved. However, tenants and buyers are sometimes confused due to varying standards in the market.
Click on the tabs below to find out what the norms are.
Whether or not a tenant needs to pay his agent depends on various factors such as the rental amount of the property they are leasing and their lease terms. Of course, there may be circumstances where tenants have special requirements and agree to pay their agents regardless of these factors. If you would like to find out more about why you should use and agent, click HERE to contact us.
You will be required to pay if:
- You are going for a one-year lease
- Your rental amount is below $3500 to $4000
- You are looking for a HDB unit
Let’s explain why this is so.
An agent serving the tenant gets paid when the listing/landlord’s agent cobrokes his property and shares his commission. When the amount gets too small to split, most agents are unwilling to share and tenants will be required to pay for the agent’s service.
Two Year’s Lease
A listing agent typically charges the landlord one month’s commission for a two-year lease in return for marketing his place, and sometimes, out of goodwill, includes managing the property during the term of the lease. If the rental amount is reasonable, most agents are happy to share the commission.
One Year’s Lease
The landlord pays half a month’s lease for a one-year lease. Usually the amount is too small to split as agents have to incur costs when marketing the units for rent and there is no saying how many viewings are required to secure a tenant for the property.
HDB units
For HDB (public housing) units, most times the rental amount is low, hence tenants do have to pay their agents. Even when the amount reaches $3500, most listing/landlord’s agents are not eager to share the commission due to the market practice.
If you are purchasing a developer’s unit, there is no charge for securing a purchase on your behalf.
However, you will be required to pay if:
- You are buying a HDB property
- You are buying a private property with low quantum
HDB buyers typically pay their agents 1% for the entire process of consultation, working out their financial calculations, arranging viewings, negotiation and finally attending the HDB appointment with their clients.
Private resale property buyers are in a trickier position. There are no hard and fast rules about whether they have to pay their agent for the purchase of a private property.
It largely depends on the agreement between them and their agents. Buyers may agree to pay in such circumstances – their purchase price is low, their benefits from engaging a highly-skilled agent justifies the commission, their agents have expended an inordinate amount of time during the search for the right property, or they may be looking for a highly specialized niche property.
Unless you are game enough to sell your own property, most sellers engage an agent. Agents are not just more familiar with the procedures, market price and practices. More importantly, they are not emotionally-attached to the property being marketed and this helps them be more objective in their advice to their clients.
Typically, the market practice is 2% of the sale price. The percentage is negotiable based on what marketing channels are used, whether there is home staging, video tour, and digital marketing on top of the conventional portal or newspaper listings. Of course the fee is also dependent on the quantum price of the property.
If you wish to discuss the marketing plan for the sale of your property, do contact our Property Science consultants.

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