By Ravinder Kapur, Zuu Southeast Asia. 5th June 2017
Purchasing real estate is never easy. There are innumerable factors to be taken into consideration. Possibly the most important condition to be met is that the property should have the potential to appreciate in value over time. If you need help with the purchase of a property, click here.
Of course, it is also vital that the property is well-maintained and that it is located in a prime area. If you are buying a home, your personal preferences and those of your family members will play a crucial role in your choice. But if you are purchasing an investment property, your outlook will be different.
In most instances, your decision to buy will depend on the price that is being quoted. Is the amount that you are being asked to pay too much? What is the current value of similar properties in the same area?
When making a decision on a real estate purchase, you can use all the help that you can get. Advice from an expert can be especially useful. A trustworthy and experienced property agent is usually the best person that you can turn to in such a situation.
1. An estate agent will help you locate the property that best meets your needs
As a prospective property buyer, you would probably start with a particular budget in mind. You may also have a broad idea about the area in which you want to make the purchase. But there could literally be dozens of flats that are affordably priced and which also meet your other requirements. How will you choose?
Estate agents normally have a high degree of knowledge about the specific neighborhood that they operate in. How old is a particular building? Are there any details that you should be familiar with before you commit hundreds of thousands of dollars to buying a flat there?
Even if your preferred property is in a location that the estate agent is not familiar with, it is likely that the agency will be in a position to provide you with the required information. How will the property agent do this? The salespersons at the agency usually have a network of contacts across Singapore. It is quite easy for them to gather the details that you require.
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2. A property agent brings negotiation skills to the table
Singapore’s real estate prices have been going downhill for the last three years
While there are many reasons for this decline in prices, one major contributing factor is that currently supply exceeds demand. The problem is exacerbated by the fact that large numbers of new residential units will continue to be added over the coming months and years.
At the end of the first quarter of 2017, there were 36,942 uncompleted private residential units. This figure excludes executive condominiums. Of these 36,942 units, almost 16,000 remained unsold till 31st March, though this is the lowest number of unsold uncompleted inventory since the third quarter of 2006.
All this data indicates that Singapore is a buyer’s market, and that it is possible to negotiate for a fair price for the property of your interest. However, this requires specialised skills and knowledge, and a property agent may be the best person to help you and ensure you are getting the best possible value.
The salesperson who is handling your account has probably been in dozens of negotiations before. This individual will know how long the property has remained unsold and the prices at which similar flats in the vicinity have been sold in the recent past.
3. A home inspection is essential
Once you zero in on a property, you should arrange to get it inspected. Remember that there may be defects that are invisible to the untrained eye. Are there damp spots on the walls or on the ceiling? Is there any termite infestation? Are all the electrical fittings in good condition?
A property agent can play an important role in the inspection process. You will need to identify a competent agency that is reasonably priced. The agent will be able to help with this.
What if the inspection reveals some flaws? If you go ahead with your purchase, you will have to bear the cost of rectification. Your property agent would be able to help you negotiate for a price that reflects the cost of the rectification.
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4. You will need guidance during the buying process
There are various steps involved when you are purchasing real estate. Of course, one of the first hurdles that you have to overcome is to arrange the money. It is advisable to obtain an Approval-in-Principle from your bank right away. When this is in place, you can then move to the next stage, which requires you to pay 1% of the agreed value and enter into an Option to Purchase contract with the seller.
There are several other formalities to be completed. The entire process can take between 10 to 12 weeks. A property agent is the ideal person to guide you during this time. The advice that the agency provides will help you in successfully completing the purchase.
5. Buying an HDB resale flat can be complicated
An estate agent’s help can prove invaluable if you are buying an HDB resale flat. The eligibility criteria can be quite complicated. There are different schemes for unmarried people (singles), joint singles, and for non-citizens who are married to Singaporeans. A salesperson from an estate agency can guide you through the maze of regulations.
A resale checklist for buyers is required to be completed. Additionally, buyers need to submit an application form, sign statutory declarations in the presence of a Notary Public, and also provide various undertakings to the HDB authorities.
An agent’s knowledge and experience can prove to be of tremendous help in the buying process.
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Estate agents are regulated by the Council for Estate Agencies
Can you trust your property agent? Singapore’s property agents function under the control of the Council for Estate Agencies (CEA), a statutory body that works under the ministry of national development.
Every agency is registered with the CEA and it is possible to verify the credentials of the agency that you propose to deal with. But bear in mind that the CEA does not regulate the fees that an estate agency charges. You need to negotiate these yourself and it is usually a good practice to speak to several agents before making your choice.
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