A property agent commission can easily hit five- to six-digits, with some even earning a million-dollar commission. That’s why it’s understandable why many would think that working as a property agent is one of the best jobs in the world. Aside from the possibility of earning huge property agent commissions, you get to be your own boss and have the freedom to work whenever you want.
In fact, back in April 2015, a property agent earned a whopping $1.5 million commission after selling a penthouse at Le Nouvel Ardmore for $51 million.
However, buyers and sellers of the property are advised to be more careful, especially since a property agent was caught deceiving both the buyer and seller of an HDB flat in order to receive double the commission. The property agent was sentenced to 23 weeks in jail and fined S$11,000. To avoid being in a situation like this, buyers and sellers can make use of PropertyGuru’s Agent Ratings and Reviews feature (we’ll talk more about this new feature later in the article).
Nevertheless, with so many perks, it’s no wonder that a career as a property agent in Singapore is relatively sought-after. Unfortunately, not everything about being a property agent is rosy.
So before you apply for a Singapore property agent license, here are some things that you should know first.
|Reasons why being a property agent isn’t rosy||Explanation|
|Property agents can have zero income for months||There will be periods where transactions are sluggish|
|Property agent commissions and salaries depend solely on closing deals||You don’t enjoy a steady income, and only receive (potentially lucrative) property agent commissions by closing deals|
|You need to spend money to get results||You need to invest money to market yourself to clients|
|You work on evenings, weekends, and even holidays||Prepare to work outside normal working hours|
1. Your Property Agent Commission Is Your Salary
One of the toughest problems you could face being a property agent in Singapore is that you might not close any deals for months, leaving you with no property agent commission and thus no income during that period.
While property agent commissions can hit a million dollars from just a single sale, the industry usually follows a cyclical trend. This means there can be periods when many people are rushing to buy houses, and at times when transactions are sluggish and affect a property agent’s commission.
Let’s look at the yearly transactions of new private houses in Singapore. From 2009 to 2012, new private home sales (excluding executive condos) increased significantly from 15,904 units to 22,197 units a year.
But when the cooling measures took effect in July 2013, transaction volume fell to 14,948 units. Then in 2014, sales plunged by more than half to 7,316 units.
Though sales volume started to pick up from 2015 onwards, it still isn’t as high as in previous years. In the recent five years, private home sales are averaging around 9,945 units, which is still below the pre-cooling measure average of 14,729 units sold between 2007 and 2013.
While the above doesn’t account for property agent commissions from rentals, and transactions for HDB resale flats and resale private properties, selling new private homes accounts for a substantial chunk of a property agent’s salary.
Currently, owner-occupied homes face a property tax rate increase of between 6% and 32% for the portion of the annual value above $30,000. For non-owner-occupied properties, the increase in property tax rates is even higher.
Coupled with the announcement of the December 2021 property cooling measures which saw a hike in Additional Buyer’s Stamp Duty (ABSD) and rising interest rates which may cause more to be financially prudent, these combined factors could mean slower movements in the property market.
With new private home sales increasing in July 2022 and more HDB flats selling for a million dollars, perhaps we’re at the start of another cycle where property agents might see an increase in transactions and property agent commissions.
2. Property Agent’s Commission and Salary Depends Solely on Closing Deals
One of the top perks of being a property agent in Singapore is that you get to earn commission from sales and rentals that typically surpass the monthly salary of average jobs in the city-state. But this also means that you might not get to enjoy the regular and steady income, and only get paid if you close a transaction.
Hence, you can only earn more by completing a greater number of property deals or closing a lower number of high-value sales, like the $51 million deal for the Le Nouvel Ardmore condo. This means that a property agent’s commission is ultimately their salary, and monthly income can seesaw from high to low.
While there are no black and white rates or guidelines on how much property agents in Singapore should be paid per closed deal, you can expect to get a 2% property agent commission for successfully selling a home, as well as a month’s rent for every 2-year rental.
Let’s say in a particular year, you manage to sell four private condos at $800,000 each. With a 2% property agent commission for each deal, this means that you’ll earn $64,000 that year.
This equates to a monthly salary of around $5,333.33. This isn’t that bad for a monthly salary, given that it’s higher than the median salary of $4,680 in Singapore in 2021.
But if you take into account the additional expenses that you’ll need to fork out to close deals, that amount might not turn out to be that high… Not to mention, the Urban Redevelopment Authority (URA) is now probing property agents’ commission rates. There could be a possibility of real estate agent commission rates dropping in the near future.
3. Property Agents Need to Spend Money to Get Results
Just like in every business or start-up, you’ll need to first invest some money before you can make decent money from closing deals.
For starters, you’ll need to spend some money to provide services to your clients. And there’s no guarantee that you’ll close these transactions.
Let’s say you accompany your client to see different shortlisted properties for two months. To bring your client to visit these properties, you spend a lot of money on petrol to chauffeur him/her around Singapore.
Another example is when your client decides to buy a particular home, you begin taking care of the relevant documents. But just before the signing of the sales and purchase agreement, your client decides to back out.
Although this is rare, there’s still the possibility that this can happen. Despite putting in all your hard work, you end up getting nothing in return, and that’s the nature of the business.
There are also marketing expenses that you need to spend to market yourself, be it flyers, newspaper ads, social media, or online listings, you have to spend some money to reach out to as many people as possible.
As a property agent in Singapore, you can subscribe to PropertyGuru’s agent package, which allows you to get your listings seen by home hunters and real estate investors.
4. Property Agents Have to Work on Evenings, Weekends, and Even Holidays
Being a property agent means that you have to be prepared to work outside normal working hours.
Most Singaporeans work standard working hours from Monday to Friday. This means you might only be able to meet your clients when they’re free in the evenings, at weekends, or even on public holidays.
In addition, you should prepare to work longer hours, especially to market new residential projects here in Singapore and abroad.
Aside from marketing units and showing properties to your clients, you’ll also need to provide further services. This includes assisting them in negotiating the best price, overseeing the sale or rental process, handling all the necessary paperwork, and sharing accurate market data.
Nevertheless, being a property agent means that most of the time you’re your own boss. There’s no one to dictate when you need to work. Plus, you have the freedom to take time off whenever you want.
How Can I Succeed as a Property Agent in Singapore?
- Take on side jobs and acquire other skills
- Stand out, but also be a team player
- Learn to manage your time
- Cultivate a charming personality and appearance
- Uphold honesty and integrity
Though being a property agent can be challenging, it can be equally rewarding as well, especially when you close off a deal after months of hard work.
So, here are some of our tips to help you succeed in the profession.
1. Take on Side Jobs and Acquire Other Skills
With the possibility that you might not earn anything for a few months, some property agents have taken on side jobs. In January 2016, it was reported that a 50-year-old property agent named Billy Loh worked as a driver for Uber after not securing any deals for six months.
You can also take up courses by the Institute of Estate Agents (IEA), which trains real estate agents for other jobs such as property management to obtain supplemental income.
You may want to widen your career options too, by enrolling in other training courses offered by SkillsFuture, and taking advantage of your SkillsFuture credit.
An alternative is also to improve your craft. Be sure to stay updated on the latest rules and regulations, as well as the latest trends in the property market.
2. Stand Out, but Also Be a Team Player
Here’s a table of the number of property agents and agencies in Singapore for the last five years, according to CEA:
Amidst the thousands of real estate agents in Singapore, you’ll need to stand out to get noticed by potential clients.
You can start by answering people’s questions on PropertyGuru’s AskGuru portal. Behind these questions, there might be clients with a real intention to buy or sell a property.
You can think of these questions as sort of an initial test that prospective clients use to select a suitable property agent. People are more likely to choose agents who provide helpful answers than those who give short and vague answers.
For listings, you can stand out by posting clear and visible photos of neat rooms. Overlay your picture and contact details on just one photo, and not the rest, as people can get frustrated when they want to see an entire room and your photo is blocking the view. Also, avoid using picture collages.
While there’s a need to stand out, you should also be a team player, as there are many advantages of cooperating with working and getting along well with property agents in your agency. For starters, you can get a lot of helpful advice from your seniors.
There could also be cases when you need to work together with another real estate agent to close a sale or rental transaction. Known as co-broking, this shortens the time you need to find a buyer or tenant, though you’ll need to share the property agent commission with the other real estate agent.
3. Learn to Manage Your Time
Even if you have many talents and skills, you won’t succeed as a property agent in Singapore if you can’t properly manage your time and workload.
For example, when scheduling your meetings, you should consider possible client delays and traffic, so that you won’t be late for subsequent meetings. This is especially important as being late can give a lasting negative impression to your clients as well as colleagues.
Also, a well-organised schedule gives you more freedom to spend quality time with your family.
4. Cultivate a Charming Personality and Appearance
People are more likely to engage you as their property agent if you’re someone they’re comfortable with. Be genuinely cheerful, enthusiastic, and friendly. It also helps if you have a good sense of humour.
Be sure to improve your communication skills too, so you can get your message across clearly and prevent misunderstandings. In the property industry, it’s important that you provide accurate information.
When meeting with clients, dress appropriately depending on the situation and venue. If it’s a high-end restaurant, company premises, or the property itself, you can wear a suit, office shirt with slacks, or an elegant dress.
But if you’re meeting them at a coffee shop or at an informal setting, wearing smart casual attire like a polo t-shirt and a pair of pants should suffice.
You might also want to keep a blazer in your car in case you need to attend an unexpected formal meeting.
5. Uphold Honesty and Integrity
Last but not least, all the talent in the world means nothing if you aren’t honest and lack integrity.
Be sure to follow CEA’s Code of Ethics and Professional Client Care. As a property agent in Singapore, you should always safeguard and look after the interest of your clients, even if doing so could mean some inconvenience to you.
Needless, you shouldn’t break the rules to earn easy money. Take the example of James Ngu, who was fined $30,000 and suspended for lying to pocket a higher commission. Or property agents Mu Shen and Loy Thye Wei who were jailed for backdating a property’s Option to Purchase (OTP) to evade higher stamp duties.
Other things you should not be doing include giving a cut of your commission to the buyer in the form of kickbacks or dual representing.
And of course, take note that you need to be registered with CEA to legally become a property agent in Singapore.
PropertyGuru Agent Ratings and Reviews: How to Leave a Rating
As a buyer or seller, or a landlord or tenant, you might need to engage the services of a property agent. Property agent scams have seen a resurgence, with at least 997 people losing a total of $3.9 million since the start of 2022 to scammers posing as agents. In the face of such scams, the need to be prudent and find trusted agents is more important than ever.
So, how do you avoid being in a situation with a dishonest property agent or a potential scammer?
The idea behind having the PropertyGuru Agent Ratings and Reviews feature is to help sellers and buyers find a trusted property agent. When it comes to money-related issues, it’s important to find a property agent who is honest and trustworthy.
Using the Agent Ratings and Reviews feature, not only will you be able to access an agent’s ratings and reviews, but also their details, including information such as their name, CEA registration number, number of active property listings, and so on.
If you’ve engaged the services of a real estate agent, do take a minute or so to leave them a review and rating. It’ll go a long way in helping others in their search for a reliable agent.
You can do so via the agent’s profile page, via the agent contact card on their listing pages, through email or notifications (after you enquire for a property), or by contacting your agent to request a review link that will lead you directly to the agent review form.
For more property news, content and resources, check out PropertyGuru’s guides section.
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