PRACTICE GUIDELINES FOR THE SALE & MARKETING PROCESS OF
FOREIGN PROPERTIES
The purchase of foreign properties carries additional risks not associated with local property transactions.
Property agencies and agents therefore play an important role in carrying out due diligence and advising consumers on the risks involved in purchasing foreign properties located outside Singapore, regardless of whether they are developed by foreign developers or Singapore developers, or whether they are owned by foreigners or Singaporeans. .
If you are marketing or facilitating the sale of foreign properties inSingapore ,
remember to abide by the Council for Estate Agencies’ Practice Guidelines
regarding the conduct of such estate agency work.
The guidelines seek to instill professional practices that property agencies and agents must adopt in the sale and marketing process of properties located outsideSingapore ,
as well as to better protect consumers’ interests.The sale and purchase of a foreign property is subject to the laws of the country where the property is located, with differing legal processes and financing practices.
This set of guidelines on the marketing of foreign properties took effect on 1 December 2018, superseding those issued in 2014 (PG01-14).
Let’s take a look at some of the key changes to the guidelines:
Do refer to the Practice Guidelines (click on the link) for the full set of guidelines on the sale and marketing process of foreign properties inSingapore.
(Information accurate as at 29 March 2019.)
Info courtesy - The Council for Estate Agencies.
The purchase of foreign properties carries additional risks not associated with local property transactions.
Property agencies and agents therefore play an important role in carrying out due diligence and advising consumers on the risks involved in purchasing foreign properties located outside Singapore, regardless of whether they are developed by foreign developers or Singapore developers, or whether they are owned by foreigners or Singaporeans. .
If you are marketing or facilitating the sale of foreign properties in
The guidelines seek to instill professional practices that property agencies and agents must adopt in the sale and marketing process of properties located outside
This set of guidelines on the marketing of foreign properties took effect on 1 December 2018, superseding those issued in 2014 (PG01-14).
- In the pre-marketing phase, property agencies must now confirm that guarantees made in advertisements, e.g. return on investments (ROI) are binding on the vendor (such as the developer or underwriter who owns and sells the property purchased from the developer).
- Due diligence checks must be conducted by Estate agents. Due diligence must be conducted on the vendor and his claims.Due diligence must also be conducted on the foreign property, to verify the specifications and other material information relating to the foreign property, such as property title, tenure, location, size, features, amenities, etc.
- Property agencies must check whether there is information that is adverse or potentially adverse about the vendor or the property. This can be done by screening for news in the mainstream or social media.
- If property agencies assess that there are adverse or potentially adverse findings, they must inform consumers in writing.
- The agencies must also see the contractual documents providing these guarantees. If the figures indicated in the advertisement are not current, the date and time of the data must be stated in the advertisement e.g. ROI from previous years.
- Engagement of a Third Party to Conduct Due Diligence - Where an estate agent engages or depends on a third party (e.g. a company that provides compliance/accounting services, a foreign estate agent or a local representative in the country where the foreign property is located) to perform due diligence checks, the estate agent shall verify and ensure that the third party is qualified and appropriate to perform the due diligence. Estate agents shall determine the scope of due diligence to be performed by the third party and shall assess the results delivered accordingly.
- If a salesperson intends to represent a vendor or purchaser in a foreign property transaction, he shall seek approval from his estate agent to do so.
- Estate agents shall ensure that they possess the necessary and adequate professional indemnity insurance for the conduct of estate agency work to market foreign properties.
- The agent must also be able to advise on the due diligence, risks, payment and financing for the property. Consumers are advised to also conduct their own due diligence and proceed at their own risk.
- Estate agents and salespersons shall explain to consumers the arrangements for the signing of transaction documents (e.g. Sale and Purchase Agreements) and advise them to seek independent legal advice to explain the terms and conditions of the documents before they sign them.
- If the documents are not provided in English, property agencies must obtain an English translation from reasonably qualified translators and provide the documents to consumers before these are signed.
- Salespersons who are marketing on behalf of the vendor cannot represent consumers in the same transaction.
- Estate agents and salespersons shall explain to consumers the dispute resolution mechanism that will apply in the event of a dispute relating to the purchase.They shall also inform consumers about the applicable jurisdiction where a dispute will be resolved, as well as the governing law of the Sale and Purchase Agreement (or equivalent contract).
- Must keep all records and documents.
Do refer to the Practice Guidelines (click on the link) for the full set of guidelines on the sale and marketing process of foreign properties in
Info courtesy - The Council for Estate Agencies.
