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| Removal of IEA's Commission Guidelines |
15 December 2009
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PRESS RELEASE
Tuesday, 5th August 2008
Removal of IEA's Commission Guidelines
Moving forward IEA will remove IEA’s guidelines in September 2008 and paving the way for industry players and real estate agencies to set their own commission guidelines.
On 18th July 2007, IEA submitted the IEA’s “Professional Fee/Commission for Real Estate Agents/Agencies.” to the Competition Commission of Singapore (CCS) seeking the Commission’s guidance, pursuant to Section 43 of the Competition Act (Cap 50B) on the Notification and Application if it infringes Section 34 of the Competition Act ( Cap. 50B ), which prohibits agreements, decisions by association of undertaking or concerted practices which have the object or effect of preventing, restricting or distorting competition within Singapore.
Many rounds of meetings and discussions took place between IEA and the Competition Commission of Singapore over the period of the year with reference to the IEA Guidelines, the1974 Government Gazette and the rationale for IEA’s introduction of the IEA Professional Fee Guidelines in 1999 and the amendments thereafter.
IEA has always maintained that the Guidelines are non-binding and that real estate agents are free to negotiate fees with their customers. Real estate agents in Singapore are not regulated.
On 25th June 2008, IEA has been advised by the Competition Commission of Singapore (CCS) to remove all elements of fee recommendations and recommendations on fee structures from the Guidelines and any reference to the same in materials that it provides to its members and to the public such that the Guidelines are compliant with the Act.
The CCS noted that IEA in its submission had stated that the IEA Guideline is widely accepted and in practice in the industry today but find it to be the de facto industry standard. IEA has been advised to take the necessary steps to inform our Members, the industry and the public on the abolishment of the Guidelines and relevant materials within three (3) months of the date of issuance of the Guidance. i.e. by 25th September 2008.
The CCS is of the view that the Guideline is harmful to competition, restricting competition in both fee levels and fee structure in the real estate industry and likely to have the object of appreciably restricting competition among real estate agents in the real estate agency market AND that it is IEA’s desire to set industry standard applicable to estate agents and agencies and it affects competition because it enables all participants to predict with a reasonable degree of uncertainty what the pricing policy pursued by their competitors will be.
IEA’s point of view is that we have to comply though we have highlighted to the Competition Commission of Singapore that IEA may not be agreeable to their guidance or assessment which are consistent with decisions by established foreign competition authorities, where the real estate agents are regulated but unlike those in the Singapore who are yet to be regulated.
IEA will be removing the IEA Professional Fee Guidelines and would not advise, encourage or facilitate any discussions, agreements or arrangements on fees amongst IEA members or industry players. We encourage our members and industry players to set their own professional fees/ commission rates and services that they will provide to their customers.
In view of CCS guidance and the removal of the IEA Professional Fees Guidelines, our advice to customers is to do your own due diligence when engaging your next real estate agent AND if you want to choose a professional real estate agent, choose one who is a member of IEA. At least, you will have peace of mind and an avenue for redress if necessary.
IEA maintains that the rationale for the introduction of the Guidelines is meant for better uniformity in fees and as an accepted and approved standard for real estate agents’ remunerations for transactions and to keep the customers informed and avoid over charging. IEA’s 10 year old Professional Fee Guidelines being what it is, is not binding but merely as a point of reference in the real estate industry.
IEA would like to take this opportunity to encourage consumers to engage agents who are members of IEA. Members of IEA adhere to a strict Code of Conduct & Ethics and IEA has a Mediation Board & Disciplinary Board to address any complaints from consumers. Members of IEA are also encourage to subscribe to Professional Indemnity Insurance (P.I) to protect the interests of consumers.
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| Deferred Payment Scheme |
03 November 2007
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The deferred payment scheme(DPS)is withdrawn and the government promises more measures if necessary to cool the market.
So far it had made some impact and most developers are watching the market closely. |
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| New rules for enbloc |
22 September 2007
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New rules were passed regulating enbloc sales.
Associates should read up the rules before advising their clients. |
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| Enbloc Track Records |
09 August 2007
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Loyang Lodge
Located off Jalan Loyang Besar D 18
Residential PR 1.4 Height 5 storeys
43,649 sq ft GFA 61,108 sqft
Value $14.8M
Elegance View
Total Units 24 units (11 sold to a developer)
RH selling the remaining 13 units at $15.6 million , reflecting $366 psf ppr
Option delivered to prospective purchaser on private treaty.
Promises Garden
55, Jalan Lim Tai See off Sixth Avenue
Pending change of plot ratio from 3 storeylanded to plot ratio of 1.6.
Land area : 60,429 sq ft
Value : Approx $60 million upwards
Wai Wing Mansions
Balestier Road/Shan Road
Site area : 9,719 sq ft
Plot Ratio: 3
Zoned: Commercial & Residential
Value : $20 million
Waldorf Apartments
235, Balestier Road
Site Area 11,348 sqft
13 storey apartments with 16 units
Tender pending
Price: $18 million reserve price
Holland Courts
Site Area 35,000 sqft
Plot ratio 1.4
5 storey
Pending CSA
Price: $18 million reserve price
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| Enbloc Track Records |
09 August 2007
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Balestier Court
Residential Site located in D12
Balestier Rd
100% consensus 10,429 sq ft
PR 2.8/36 storeys
Sold at $13.8 m
Concorde Residences
Residential site located in D11
Thomson Road
site 35,000 sq ft
PR 2.8/ 36 storeys
Sold at $51 million
Bright Building
Residential Site
located in D12
Site area12,227sq ft
PR 2.8/36 storeys
Price $17.3 million
Paterson Lodge
Exchange Programme (1st in this current boom in Orchard Road vicinity)
20 units based on Exchange Programme
Site area : approx 14,000 sq ft
Breakeven at $900 psf ppr (breakeven $35 m.)
Current value $130 million (reflecting approx $2,800 psf selling price
Ruby Plaza
Located in Balestier Road, District 12
Mixed use, commercial & residential
Plot ratio 3 with high rise potential
Status: Pending change of use to Hotel with 422 rooms.
Price : $69 million
24 Cheong Chin Nam Road
Commercial Site
Site area 11,947 sqft Commercial Zone
Plot ratio 1.4 height restriction 5 storeys
Status: Sold
Total Price $12 million
Merlin Mansion
Residential site
D15 (East Coast Rd)
Site area 36,174sq ft
PR 1.4
5 storeys
Price $25.5M($530ppr)
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| Stamp Duties |
25 March 2007
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| With the recent announcement on the stamp duties please remember to remind purchasers that stamp duty is payable within 14 days of the Acceptance of Option. |
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