Minimising agent fees for condo rentals

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risky
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Minimising agent fees for condo rentals

Post by risky » Wed, 26 Jan 2011 2:44 pm

I have a firm idea of our budget ($5000-$5500) as well as a shortlist of around 10 properties, which will probably narrow once I get to Singapore and see them. And this will be for a two year lease. I am not wishing to exploit or game the system/agents, but instead I wanted to see if my actions when I arrive (when/how I engage agents, etc) would make any difference to my total out of pocket.

I've numbered the below questions/ideas in case that makes it easier to answer!

1. In another thread, someone suggested posting a "Wanted to Rent" type of ad to try to attract an owner directly and have the best chance of lower rent.
a) Realistically, would this have much chance of being successful?
b) What are the chances that I'll regret it by getting ripped off by a landlord directly (T&C's, deposit, etc)

2. If I search for apartments directly, and then directly engage the landlord's agent, is that likely at all to result in a more negotiable price? [I'm pretty sure that if two agents are involved (either my agent + landlord's, or something already co-broked), then they will usually each get 1/2 a month's rent each from the landlord. If only one agent is involved (landlord's) and I engage them directly, would the landlord ever pay them just 1/2 month's rent only and be more open to negotiate on rental price?]

3. I was advised that for co-broked apartments, neither agent has much interest in helping a tenant lower the price because then their commissions are lowered. Is there any way to maximise chances of price negotiation under such circumstances?

4. Assuming the answers to the above 3 questions are all negative, then I figure I may as well make it easier for myself and engage one agent and say "show me apartments in range $x in any of the following developments". If my budget is fixed, and I'm just trying to get the best deal within that budget, them presumably my own agent will be more likely to work in my interest (negotiating the price down to my budget, or getting extra furnishings included, etc) than in other situations?

5. If I've engaged my own agent in #4 above, does this cause a problem if I'm interested in any apartments which are pre-co-broked?

6. There would appear to be quite a lot of apartments available in most blocks I'm interested in, many of them identical. Does anyone have a guess for what the negotiable amount off advertised price is likely to be now? (e.g. 10%). My local friends told me that rental prices are driven a lot by supply and demand. When prices drop due to oversupply, is it usually reflected in the advertised prices, or do those remain high and it's the negotiated prices which tend to fluctuate more?

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Post by JayCee » Wed, 26 Jan 2011 3:56 pm

If your budget is 5000-5500 then you should be able to engage an agent for you who will find places and won't charge you any commission either, a lot of companies have rules such as "for rent above 3000/3500/whatever the agent claims all commission from the landlord" so try to find one of those. Alternatively when you call a number from an advert on the internet tell the agent that they are not representing you and therefore you won't be paying them commission, if they refuse then hang up and call the next one, for a budget of 5000-5500 you won't have to look far to find one willing to help

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Post by Saint » Wed, 26 Jan 2011 4:05 pm

^^^

I've never paid any commission and never will do. As mentioned above, just confirm with the agent that he/she is acting solely on behalf of the LL and not you as the tenant, even if it's co-broked or co-co-broked etc.

The only fee I would recommend you definitely pay is the Stamp Duty once the TA is signed

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Post by risky » Thu, 27 Jan 2011 12:32 pm

I'm not too worried about paying fees directly to any agent, especially thanks to the advice given on the forum. I'm more interested in lowering the total fees paid.

Let me rephrase another way: I assume that if the owner can minimise the fees *he* pays to the agents, then he may be more willing to negotiate on rent. Therefore, seeing as I know my budget and will know which buildings I'm interested in, and not need to waste any agent's time, is there anything I can do to minimise the owner's fees to hopefully then get myself a better deal?

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Post by JayCee » Thu, 27 Jan 2011 12:58 pm

risky wrote: Let me rephrase another way: I assume that if the owner can minimise the fees *he* pays to the agents, then he may be more willing to negotiate on rent.
Not a chance, this is Singapore the landlord will just see the chance to make more money for himself

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Post by beppi » Thu, 27 Jan 2011 10:08 pm

For some strange reason, many landlords in Singapore would rather leave a property empty than accepting a rent below what they perceive it is worth. Thus demand and supply only work on the market as a whole, not for a single apartment or area.
Agents will, after hearing your budget, do anything in their power to make you rent a place that costs more. And they are good at that - probably the only skill they have.
Despite some risk of being cheated by a landlord (which isn't much lowered by an agent, because he will disappear as soon as the contract is signed and he has the commission), it is much preferable in my opinion to deal with them directly, if you can spare the time and effort. A "Wanted" ad, or leaflets in the mailboxes of the neighbourhood you are interested in, are probably a good idea - although the majority of replies will be agents even if you specify "No Agents!" (reading is apparently not among their skills)
99% of all "For Rent" ads are by agents (even some of those which say placed by "owner"), but occasionally you find a real landlord ad. I found all my previous abodes (6 of them!) this way and it was always a much better deal than anything the agents (whom I gave a chance every time) came up with.

Good luck!

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Post by Mad Scientist » Fri, 28 Jan 2011 3:57 am

beppi wrote: 99% of all "For Rent" ads are by agents (even some of those which say placed by "owner"), but occasionally you find a real landlord ad. I found all my previous abodes (6 of them!) this way and it was always a much better deal than anything the agents (whom I gave a chance every time) came up with.
@beppi; you are a kind person. I would shoot the agent first then ask question. One of the few low life people that makes money out of other someone's else misery.
But to be fair, real estate agent in many countries act this way. The only difference in SG, it is more rampant and there is no recourse for justification if the tenant felt being cheated OR dare I say, the justice system in this kind of case is a joke.
The positive thinker sees the invisible, feels the intangible, and achieves the impossible.Yahoo !!!

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Post by beppi » Fri, 28 Jan 2011 12:49 pm

MS wrote:
> I would shoot the agent first then ask question. One of the few low life people that makes money out of other someone's else misery.

There is a good justification (and I believe real demand) for people offering services for those who don't have the time, energy or knowledge to do it themselves. The search for accommodation when you arrive in a new place (and have enough other issues on your mind) is an obvious example.
However, since the idea of service is underdeveloped in Singapore and most people in the field are interested only in quick money, real estate agents here don't fulfill this need and disappoint many of their clients. That's shown in the many negative postings on this and other forums.

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Post by longstebe » Fri, 28 Jan 2011 1:27 pm

Surely anyone relocating to singapore can pretty much narrow down where they want to be before arriving at Changi airport. This site alone is very helpful and has a great search engine to help you along.
Narrowing your search to maybe 3 or 4 places before calling an agent makes their life easy and therefore they don't have a leg to stand on asking for commission.
You've basically done their job for them.

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Post by risky » Fri, 28 Jan 2011 8:37 pm

From my point of view, I'm not anti-landlord or anti-agent, as I think it's a free market for them to do what they want within the law. Nor do I believe in the landlord being good natured or "fair" if I save them money. My idea was just that if I can save them half the fees, they are more likely to be willing to accept me bidding a few hundred dollars per month less than he's asking. This is assuming a competitive market though of course.

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Post by sundaymorningstaple » Fri, 28 Jan 2011 11:17 pm

risky wrote:From my point of view, I'm not anti-landlord or anti-agent, as I think it's a free market for them to do what they want within the law. Nor do I believe in the landlord being good natured or "fair" if I save them money. My idea was just that if I can save them half the fees, they are more likely to be willing to accept me bidding a few hundred dollars per month less than he's asking. This is assuming a competitive market though of course.
Problem is, a high percentage of LLs will let the property sit vacant rather than rent lower. They don't seem to mind as they are gamblers, and knowing the violent swings of the property market, the are waiting for the swing to lock somebody into a 2 years lease at a higher rent for a longer period rather than a lower rent just to keep it occupied, and taking a chance on somebody trashing the place on a lower rent/security deposit. They are very pragmatic sometimes.
SOME PEOPLE TRY TO TURN BACK THEIR ODOMETERS. NOT ME. I WANT PEOPLE TO KNOW WHY I LOOK THIS WAY. I'VE TRAVELED A LONG WAY, AND SOME OF THE ROADS WEREN'T PAVED. ~ Will Rogers

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Post by risky » Sat, 29 Jan 2011 2:05 pm

SMS, thanks for the insight. Alternatively, how open are LLs generally to requests for additional and/or changed furnishings? i.e. if I offer to pay the asking price, but request $2000-$3000 worth of additional furniture, is that more palatable to them in a renter's market?

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Post by sundaymorningstaple » Sat, 29 Jan 2011 2:59 pm

If you get a good one, anythings possible, but normally they are not going to spring for additional or different furniture as space in Singapore is at a premium and costs money for storage. Therefore the landlord isn't going to replace furniture unless it's broken beyond repair or totally worn out or the white goods just quite working. They'll usually tell you that you can furnish it as you wish, but you will need to store the landlord furniture and reinstall it when you leave.

But, there are those who rent partially furnished units as well (this usually mean white goods only). This is the best option for those who have decent shipping allowances. Doesn't hurt to ask though.
SOME PEOPLE TRY TO TURN BACK THEIR ODOMETERS. NOT ME. I WANT PEOPLE TO KNOW WHY I LOOK THIS WAY. I'VE TRAVELED A LONG WAY, AND SOME OF THE ROADS WEREN'T PAVED. ~ Will Rogers

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Post by risky » Mon, 31 Jan 2011 1:56 am

Thanks SMS. Two more questions for you or others:
1. Any approximation/rule of thumb for the difference in rental costs between FF and PF in places in D9? I'm not seeing a lot of difference in the ads.
2. How efficient is the second hand market in Singapore? i.e. how easy is it to buy (if arriving) and how how to sell when leaving? Anyone willing to classify second hand furniture as a buyer's market or seller's market? I'm a little set back by the inconvenience of transporting, if I buy something.

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Post by beppi » Mon, 31 Jan 2011 10:59 am

1. No rule of thumb. It depends on what the landlord has and wants. In many cases (except at the top of the rental price range) FF places have leftovers and hand-me-downs, certainly not quality furniture in good shape.

2. There is no established second hand market, as most locals would rather die than buy used stuff (apparently a Feng Shui thing). Your only options are Salvation Army or other charity thrift stores, and Expat garage sales. Bargains can be had at both (plus good Karma at the thrift stores), but probably not as and when you need it.
Nothing has any re-sale value here.
Transport is no problem: There are lots of "Man with Truck" ads in the papers and Internet, at reasonable price. The thrift stores also offer delivery.

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