Methods to Beat ABSD and Own Multiple Properties in 2024 (Updated)
TLDR Navigating the Additional Buyers Stamp Duty (ABSD) in Singapore can be daunting for property investors. To save on ABSD...
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TLDR
In Singapore, hiring a friend or family member as your property agent can be risky. Disclosing sensitive financial details may lead to complications or jealousy. They might not offer top-notch service if they lack experience in your specific needs. Social norms can make it hard to ask critical questions or fire them if needed. Personal relationships can also lead to unprofessional behavior and hidden deals. For the best results, consider hiring a professional agent who can maintain a necessary level of professionalism and confidentiality.
In Singapore, it’s practically a tradition: having a close friend or relative as your property agent. But what happens when things take a turn for the worse? Dealing with a subpar agent is one thing, but imagine having to fire your childhood buddy or someone you’ll inevitably run into at annual reunions – the thought alone is cringe-worthy. And let’s not forget the potential loss of not just your hard-earned cash, but also a valuable friendship. Before selecting your next property agent, allow us to impart some wisdom: tread carefully, dear property seekers.
1. Unveiling Hidden Secrets
When embarking on the journey of purchasing a new home or planning your property ventures, you may find yourself in the delicate position of divulging financial details to your agent. These may be details that you would not feel comfortable sharing with a dear friend or beloved family member. For instance, your combined income with your spouse may greatly exceed your apparent wealth, or you may have hidden property assets that you wish to keep discreet.
Revealing these truths to a loved one could potentially complicate matters in the future, as the green-eyed monster of envy may rear its ugly head. Moreover, there is the matter of confidentiality to consider. While you may have complete trust in your friend or family member to keep your financial matters private, there is always the possibility of unintended consequences arising later on.
2. Are You Missing Out on Top-Notch Service and Advice?
Given the negative reputation that plagues many property agents, it’s no surprise that most people prefer to work with someone they already know and trust, such as a friend or family member. After all, if you can’t rely on those closest to you, who can you rely on?
However, while this may seem like a foolproof plan, the real issue lies in the agent’s capabilities. On one hand, a friend or relative may have a strong desire to help you and go above and beyond. But on the other hand, they may not possess the necessary skills or experience to handle your specific needs.
Take for instance a situation where your friend or family member primarily deals with OCR condos and hasn’t dabbled in tenancy agreements in years. Is this person truly the best candidate to assist in renting out your 4-room flat? Chances are, there are other agents with a more up-to-date understanding of the market and a larger pool of potential tenants.
Similarly, when working with a newly minted agent who is handling their first few cases, they may turn to friends and family as their initial clients. While this shouldn’t automatically disqualify them, it’s important to consider the complexity of the transaction at hand.
Giving them a chance to find a tenant may be acceptable, but entrusting them with selling your condo or navigating a complicated upgrading process that also involves applying for ABSD remission is a risk that may not be worth taking. A mishandled process could potentially strain your relationship for years to come.
Moreover, there’s also the possibility of your friendship being taken for granted. This was the case for one of our clients who engaged their friend as their agent, only to find that their friend frequently missed appointments and had little time to spare.
“It turns out he was prioritizing his other clients and assumed that our friendship would excuse his lack of dedication. It ended up damaging our friendship, which was the very thing I was trying to avoid in the first place.”
3. When They See You as a Chore but Don’t Say It
After speaking with several real estate agents, we discovered that the situation can go both ways: there are those who dislike working with family and friends, yet feel obligated to do so when asked.
One particular realtor, who wished to remain anonymous, shared their perspective on this issue:
“As a specialist in landed properties, I don’t usually deal with HDB. I find it challenging due to the strict regulations and difficulty in standing out in the market.
Last year, I was approached by two family friends to help sell their flat. Initially, I tried to politely decline, but my mother insisted that they were elderly, uneducated, and vulnerable to being taken advantage of. Reluctantly, I took on the task and invested a lot of time and effort into it.
I believe in appreciating every opportunity that comes my way, but some cases end up costing me more than just money. It takes away from my main business and can be emotionally draining.”
It’s easy to see how this situation can quickly turn sour. If a realtor views themselves as doing you a favor, but then you also have complaints about their service, future interactions will likely be tense and uncomfortable.
4. Social Norms Ease the Usual Strictness
Choosing a friend or relative as your realtor may seem like a cozy and convenient option, but beware the impact of the social compact. This unspoken agreement can stifle your curiosity and hinder your ability to ask crucial questions.
Questions like, “Are you receiving kickbacks from any company or individual you refer me to?” or “Can we negotiate your commission?” or “Do you have experience selling properties like ours?”
These are inquiries that can make even the most confident homeowners hesitant when dealing with a familiar face. The professional dynamic between a realtor and client encourages such candid discussions, but when it’s a loved one, the social compact takes over, dictating blind trust. This can result in a frustrating lack of communication, with responses like, ”
Of course, whatever you say” to avoid seeming intrusive. If this resonates with you, then it’s best to steer clear of using friends and relatives as your real estate agent. Trust us, it’s for the best.
5. The Challenges of Letting Go: Why It’s Hard to Fire Agents
“Let’s face it, dismissing friends or family from a professional role is like walking on a tightrope while juggling flaming torches – a recipe for disaster. With the already daunting task of house hunting, do you really want to add potential family drama to the mix?
We’ve heard of a poor soul who spent a full week brainstorming how to delicately terminate their realtor, who also happened to be their father-in-law. Needless to say, they ultimately couldn’t go through with it and ended up selling for far below market value – a tough blow in a booming year like 2021.”
6. Hidden Deals: The Rise of Under-the-Table Practices
The allure is simply too alluring, enticing both you and your trusted real estate agent to delve into discussions of “furniture discounts” (code for sneaky price cuts that could lead to potential legal trouble down the road).
In the midst of this shady temptation, both parties may find themselves engaging in actions that go against their moral code – such as fudging dates on paperwork or forging signatures for the sake of convenience.
Of course, not every friend or family member turned agent will veer off the straight and narrow, but the risk of unprofessionalism is much higher when personal relationships are involved.
Some home buyers may view this intimate connection as a boon…until a hiccup arises and the finger-pointing begins.
Realtors strive for a harmonious yet distant rapport, understanding the importance of maintaining a certain level of professionalism in their training. After all, it’s all fun and games until someone gets sued.
Should You Buy, Sell or Wait?
If you’re reading this, you must be trying to figure out the best course of action right now: is it the right time to buy or sell?
It’s difficult to give an exact answer since everyone’s situation is unique and what works for one person may not necessarily work for you.
I can bring you a wealth of on-the-ground experience and a data-driven approach to provide clarity and direction. From beginners to experienced investors, our top-down, objective approach will help you on your real estate journey.
I can help you by:
- Offering Strategic Real Estate Advice – I can help create a comprehensive plan to guide you through your property journey.
- Connecting Your Home with the Perfect Buyers – Through stunning visuals, an effective communication strategy, and an in-depth knowledge of the market, we’ll ensure your home is presented in the best possible way to fulfill your goals.
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