"Booking fees" for apartment rental

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EmmyPemmy
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"Booking fees" for apartment rental

Post by EmmyPemmy » Sat, 21 Sep 2013 3:50 pm

I am in the process of renting my first apartment in Singapore. I have found a place I like and have made an offer. The estate agent then told me I have to pay $4800 as a booking fee to secure the apartment (as well as a 2-month deposit and 1 month rent upfront). What is this booking fee???? Is this the norm???? It seems ludicrous that I have to shell out so much just to secure the apartment!

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x9200
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Post by x9200 » Sat, 21 Sep 2013 4:04 pm

There is something called "good faith deposit". It is paid upon signing the Letter of Intent. Later and only after the tenancy agreement is mutually agreed and signed you will have to pay (typically) 1 month rent in advance and the security deposit (1 month of rent for 1 year of contracted lease). At that stage the good will deposit is converted to either the security deposit or the firs rental.
There is no booking fee. Even the said good will deposit is fully refundable if the tenancy agreement is not signed.

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Post by Stevie_W » Sat, 21 Sep 2013 7:52 pm

There is also the agent's fee
This is usually half month's rent if your contract is for 1 year, or 1 month's rent if it's for 2 years, but usually for 2 year's that should be paid by landlord.

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Post by freeman.vu » Sun, 22 Sep 2013 3:23 pm

Both landlord and tenant pay half of 1 month rent to agent for 1 year lease???
Sorry it doesn't make sense to me. You only pay agent when he/she is presenting you but how come it's possible for one agent to present both?
So be sure to question the agent. Like my case, I made it clear and turned out that I don't need to pay agent commission at all...

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Saint
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Post by Saint » Mon, 23 Sep 2013 11:26 am

^^ This,

An agent is no longer allowed to charge commission from both the Landlord and Tennant, this is illegal. However agents are still trying to get away with it. If you responded to an advert placed by an agent for an property to rent, the agent is acting on behalf of the Landlord and and any commission is payable by the Landlord.

This "booking fee" seems to be a way the agent is trying to get commission out of you without calling it commission. Could be the latest method to get around the law concerning commission payments.

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Post by Stevie_W » Mon, 23 Sep 2013 11:41 am

Just to clarify on what i said above for the 1 year contract.
The tenant pays half month rent to tenant's agent. The landlord pays half month rent to landlord's agent.
This is what happened in my case, and there were separate agents acting for the landlord and myself.

But having read what freeman says, does this mean that i didn't need to pay my agent anything? If so, then how does he make his money?

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Saint
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Post by Saint » Mon, 23 Sep 2013 12:02 pm

Stevie_W wrote:Just to clarify on what i said above for the 1 year contract.
The tenant pays half month rent to tenant's agent. The landlord pays half month rent to landlord's agent.
This is what happened in my case, and there were separate agents acting for the landlord and myself.

But having read what freeman says, does this mean that i didn't need to pay my agent anything? If so, then how does he make his money?
Did you contact your agent via an advertisment he/she posted for a rental property?

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Post by Stevie_W » Mon, 23 Sep 2013 12:06 pm

Saint wrote:Did you contact your agent via an advertisment he/she posted for a rental property?
No. The agent is one of the ones used by my company. Also, in addition to what i said earlier, the fee was paid to the agent's company and not directly to the agent himself.

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Post by therat » Mon, 23 Sep 2013 1:39 pm

Just some sharing

Commission is paid to property company.
Property company will took 30-40% of the commission and pass the balance to the property agent 2 to 3 months later.

If the landlord or tenant didn't paid the GST, the property agent has to come out from their own pocket to pay it.
GST is required by government , not property company or property agent.

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