Lately, we’ve been seeing a lot of homebuyers in Singapore foregoing the services of a real estate agent in favour of navigating the process alone. Today’s buyers seem more sophisticated and are able to easily browse properties online, so do they really need an agent? Or is an agent still a very important part of a real estate transaction?

Homebuyers have traditionally engaged real estate agents to help them find a home that meets their needs and get them through the process. From negotiating the best deal possible with the seller and their agent, to the home inspection, dealing with mounds of paperwork and finally closing the deal, these are all vital aspects of an agent’s job.

However, there are some homebuyers, and sellers as well, that feel no need for a real estate agent. Since 2013, about 25% of those buying or selling an HDB flat each year have done so without using an agent.

Is an agent necessary for me to find and buy a house?

There is an advantage in having an experienced property agent’s help in finding you just the right house. They are a trained professional who understands the industry’s rules and regulations. If you engage a reputable agent, he/she will bring to your attention details that you might miss, whether they involve specific properties, or the terms spelled out in the Option to Purchase of the property you’re buying.

An experienced agent will do more than just guide you in your dealings with sellers and their agents, he/she will also find other properties for you to consider based on your price range, wants, and needs. Your agent will also set up viewings, negotiate on your behalf with sellers and/or their agents, explain the paperwork, and give you expert advice on the documents you are required to sign.

Homebuyers often make decisions based on emotions when they would benefit by being more objective. A real estate agent will offer that objectivity when needed, especially when it comes to price. They come equipped with details on the most recent transactions in the neighbourhood including the block and unit and/or house number. Therefore, you should be able to get an accurate valuation on the property you are most interested in. With that information, you can make a respectable offer on the property without overpaying due to your emotions. Furthermore, a good agent will recommend several reputable mortgage bankers.

An astute agent might very well keep you from being scammed by an unscrupulous person impersonating a seller to get option money from you before vanishing. Your agent would certainly verify ownership of any property you were seriously interested in before allowing you to fork over money. This would ensure that any payment you make would go to the property’s legal owner.

Also, most real estate agents have an extensive network of professional contacts in related industries that they can recommend. You will likely need a mortgage banker, moving company, renovation contractor, interior designer, and cleaning vendor. These referrals are especially important for first-time homebuyers.

If you engage a real estate agent to help you buy private property you will likely receive all the services discussed above free of charge. This is because the buyer’s agent is usually paid a portion of the commission received by the seller’s agent.

On the other hand, if you’re looking to buy an HDB flat, the going rate for engage a buyer’s agent is 1% of the transaction price. This is because these units sell for less money than private properties, plus a lot of extra work goes into transactions involving HDB flats. This includes the the Intent to Buy, Request for Valuation, and the work involved in submitting the resale application to HDB and eventually accompanying the buyers to attend HDB resale completion.

Also, there are a lot of HDB rules and regulations that the agent must know and understand. If you decide to undertake all of this on you own, you could be asking for trouble in that you may miss loopholes and make unnecessary mistakes.

Doesn’t it make sense to just skip the middleman?

If you are a first-time homebuyer, you would be much better off if you engage service of a real estate agent. Although you can easily go online to find properties for sale that includes lots of information, like the address, listing price, size, and etc., you won’t find out everything. Unless you have an astute agent with access to inside information you will not learn everything you need to know about any given property.

The only disadvantage of hiring a real estate agent would be the off chance that the one you choose turns out to be untrustworthy. You’ll only come to realise this with time when you start communicating directly with the seller and his/her agent. An untrustworthy agent can persuade buyers to only consider properties in which the seller is paying the highest commission, which is divided between the two agents.

If you are an experienced homebuyer, you may be very knowledgeable about the buying process and feel you no longer need a real estate agent. In this case, you have to be extremely thorough from beginning to end. This means double checking and perhaps triple checking everything. This starts the second you begin looking and continues until you close the deal and pick up the keys.

Without an agent working on your behalf, you must be prepared to represent yourself throughout the transaction. This means working directly with the seller’s agent and having a conveyancing lawyer that you trust implicitly. He/she is there to ensure that you abide by the rules and regulations while explaining and advising you on all the paperwork such as the Option to Purchase or Sale & Purchase Agreement.

It is totally up to you whether you engage a real estate agent or not. Even if your plan is to buy an HDB flat, there is no HDB requirement that you use an agent. However, there is no question that it is less risky for first-time homebuyers when they have a real estate agent by their side, whereas an experienced buyer may be able to get through the process without the help.

Disclaimer: The information provided in this article does not constitute legal advice. We recommend that you get the specific legal advice you need from an experienced attorney prior to taking any legal action. While we try our best to make sure that the information provided on our website is accurate, you take a risk by relying on it.

At Pinnacle Estate Agency, we strongly believe in sharing our real estate knowledge to the public.⁠ For more content like this article, check out our Singapore Property Guides.