Real Estate Agents and Payment

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WanWanWan
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Real Estate Agents and Payment

Post by WanWanWan » Fri, 26 Apr 2013 11:38 am

A very good friend of mine is a real estate agent, and has helped us tremendously with securing a wonderful place to live in over here.

Her help was invaluable, largely because the real estate system is completely and utterly different in Singapore than it is in Australia (which I am used to). Unfortunately, this makes it hard to know some things.

How do real estate agents get paid? I don't like to ask her directly, since it's a bit rude (or might be seen to be), but basically do they get a commission fee from the new tenant or anything? Is she not charging us out of niceness? Should I pay her something anyway? How much? Etc.

For the record: my spouse and I are taking her and her family out for a fancy dinner and to various places as a general thanks, but I'd like to know if we should find a way to pay her directly also, if that is what's normal.

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taxico
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Post by taxico » Fri, 26 Apr 2013 12:40 pm

usually, they get paid a commission if they successfully negotiate a tenancy or sale. higher ranking realtors also get a cut of the commission made by the agents they manage.

as there needs to be one realtor for each party, each realtor will usually be paid by their respective party.

the sum is negotiable prior to signing any lease or sale agreements. some parties will state from the outset that they do not wish to pay a commission. the realtor will decide if that is acceptable before moving forward.

commission for tenancy tends to be half the monthly amount for a 1 year lease, and a full month for a 2 year lease.

sales/reassignments tend to be based on a % of the sale price. again, negotiable and usually paid only by the selling party (commission shared by the two agents i assume).

you can write her a cash cheque if you like (more like services rendered?), or you may write the cheque out to her firm (written on her name card) and she will get her share of the amount.

if she did mostly hand holding (and perhaps another agent did the work securing your place), dinner would do just fine as she may have arranged to share the commission with the other agent or the agent from the other party.

i guess the best thing you can do for your realtor is to recommend her to others.

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Post by BillyB » Fri, 26 Apr 2013 12:46 pm

If you signed a two-year lease, then she'll get 1 month's commission from the landlord / landlady. One year contracts may also generate 0.5 month's worth of commission to the agent, but that is not always the case.

It's good to have a reliable real estate agent that you trust and also like on a personal level, as, typically, most people have a turbulent experience with the agents in Singapore!

P.S. I wouldn't pay her anything on top - she certainly won;t be working for you from the goodness of her heart!Plus, it's her job to make her clients happy. A nice meal is more than enough!

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Post by taxico » Fri, 26 Apr 2013 12:50 pm

closing thoughts: they have ways of making/sharing a commission and it is common practice. in singapore, realtors don't work for nothing if they can help it.

if she treasures the relationship she has with you and refuses to accept money, i think you should leave it at that. dinner sounds just fine.

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Post by WanWanWan » Fri, 26 Apr 2013 1:08 pm

BillyB wrote:If you signed a two-year lease, then she'll get 1 month's commission from the landlord / landlady. One year contracts may also generate 0.5 month's worth of commission to the agent, but that is not always the case.
It's a 2-year lease, yes.

So her getting paid via commission from the landlord is pretty normal? OK, thanks for clarifying. It seems to support what I found online, but there was so little written explicitly for someone who is completely new to the whole system. As long as she gets paid how she normally does, I needn't feel guilty. Dinner it is!

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Post by BillyB » Fri, 26 Apr 2013 1:10 pm

WanWanWan wrote:
BillyB wrote:If you signed a two-year lease, then she'll get 1 month's commission from the landlord / landlady. One year contracts may also generate 0.5 month's worth of commission to the agent, but that is not always the case.
It's a 2-year lease, yes.

So her getting paid via commission from the landlord is pretty normal? OK, thanks for clarifying. It seems to support what I found online, but there was so little written explicitly for someone who is completely new to the whole system. As long as she gets paid how she normally does, I needn't feel guilty. Dinner it is!
On the whole - yes, it is normal practice. Your agent should have outlined this to you prior to starting the search. But you'll know for the future, and at least she isn't trying to rip you off by asking for / changing her contract to take fee's from both sides. Looks like you found a good agent!

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Post by x9200 » Fri, 26 Apr 2013 1:12 pm

BillyB wrote:If you signed a two-year lease, then she'll get 1 month's commission from the landlord / landlady. One year contracts may also generate 0.5 month's worth of commission to the agent, but that is not always the case.

It's good to have a reliable real estate agent that you trust and also like on a personal level, as, typically, most people have a turbulent experience with the agents in Singapore!

P.S. I wouldn't pay her anything on top - she certainly won;t be working for you from the goodness of her heart!Plus, it's her job to make her clients happy. A nice meal is more than enough!
She may be working just for the opportunity created. Our agent who is with us for a good number of years works this way and we pay him only in restaurants and beer packages.

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Post by JR8 » Fri, 26 Apr 2013 7:22 pm

We have used an agent who is a distant relative of my wife.

They receive commission from the landlord, so there is nothing further to pay. But we took the agent (and spouse) out for a very nice dinner as a 'thank-you for helping us' gesture. And I expect we will again when we return to SG, and need their help once more.

I'm sure they would feel insulted if there was any suggestion of us paying them anything. Simply knowing you have helped a friend or relative is often gift enough.

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