On November 14, 2023, 16 property agencies in Singapore, representing 88% of the country’s over 34,000 property agents, signed an agreement aimed at addressing issues surrounding co-broking commissions. This pact encourages agents to adopt a best practice guide for co-broking commissions, set to take effect on July 1, 2024.

The agreement was prompted by the frequent experiences of agents, such as Grace Cheong, who have faced unethical practices from seller agents trying to avoid sharing commissions. Currently, for private property transactions, buyer agents must negotiate their share of the commission with seller agents, who typically receive a higher percentage.

Under the new agreement, buyer or rental agents will collect commission fees directly from their clients, while sellers or landlords will pay the agents representing them. This aims to create a more transparent system where commissions are agreed upon in writing before engaging clients.

Despite the Council for Estate Agencies’ requirement for agents to be open to co-broking opportunities, some agents report that the process for filing complaints is cumbersome, leading to a lack of enforcement. Co-broking currently applies to over 90% of private property resale and rental transactions, according to ERA Realty Network’s key executive officer Eugene Lim.

The agreement is expected to change the landscape of co-broking practices, although its impact may take time to materialize. Concerns remain regarding the potential for seller agents to exploit the absence of legal enforcement, which could hinder collaboration.

Property agents emphasize the importance of educating clients on the value of hiring buyer agents and the necessity of compensating them fairly for their services.