Real progress for real estate

Before 2010, it seemed that for every honest property agent, there was at least one dishonest agent. But things have changed. With the CEA’s fifth anniversary having just passed, we take a look at what it has done and what it hopes to do for the real estate industry and its consumers.

by Cheryl Marie Tay

Property is often at the forefront of many people’s minds in Singapore, and there is no shortage of real estate agents making a decent living off the high demand for property here.

Of course, as it is with any business, real estate has its good and bad sides. One buyer might have the good fortune of engaging a trustworthy agent, and yet another might, to his detriment, run into a dishonest agent.

Then and now

Before 2010, salespersons needed only licences to sell real estate. They did not need to be registered with any governing body, or obtain industry qualifications before practising. There were also no legal provisions for action against errant salespersons.

Against such a backdrop, there was an increasing trend in the number of complaints against agents and salespersons.

These days, however, buyers can turn to the Council of Estate Agents (CEA) should find themselves dealing with errant agents. Established under the Estate Agents Act on 22 October, 2010, the CEA is a statutory board under the Ministry of National Development (MND) responsible for enforcing a regulatory framework for the property industry.

One of its main aims is to raise the standard of professionalism within the industry through cooperation with property professionals, typically via industry development programmes. At the same time, the CEA acts in the interests of consumers with its target public education schemes.

Strict standards

All practising real estate agents in Singapore are required to be registered with the CEA, but not before meeting its comprehensive list of strict criteria to ensure the quality of their services.

For instance, the duties, business activities and conduct of estate agents and salespersons are fully governed by the Estate Agents Act and Regulations, which include the Code of Practice and the Code of Ethics and Professional Client Care. A Professional Service Manual was also developed to provide a service standard benchmark for the industry. There is also a system for complaint management, dispute resolution, and enforcement. Reported malpractices are thoroughly investigated, and disciplinary action taken against errant estate agents and salespersons.

Overcoming initial challenges

Since its inception, the CEA has helped regulate the property industry and made consumers less vulnerable to the dangers to which they were once highly susceptible.

Still, running the board has not been without its challenges. As a new organization with multiple stakeholders, the CEA had to establish its value to different audiences.

It guided estate agents and salespersons to emphasise the necessity of its licensing and registration processes, and helped them comply with the new requirements. For consumers, its education programmes and investigation into their complaints were all efforts to build trust between the CEA and consumers.

As such, one of its key challenges was to better understand ground issues and help the industry navigate the new regulatory landscape. To facilitate the transition into the new regulatory regime, the industry was given time to make adjustments and prepare for regulatory compliance.

The CEA adopted a light touch in handling early cases of non-compliance by advising the salespersons involved, instead of immediately pursuing enforcement. Its Executive Director, Lee Kwong Weng, says: “Looking back, we believe the open and consultative culture between the CEA and our stakeholders has gone a long way in the successful implementation of the regulatory regime.

“The close engagement and cooperation with the industry continues today, and we hold regular dialogues, focus group discussions and working groups involving industry representatives.”


Despite the aforementioned initial challenges, the CEA has been successfully offering heightened protection of consumer interests. One of the changes for the better was the disallowing of dual representation by salespeople, a common practice in HDB transactions before the CEA was established.

This ensures the interests of buyers and sellers are not compromised. Unlike before, it is now much more difficult for a salesperson to persuade a seller to sell to the buyer who offers him the highest commission, instead of the buyer with the highest offer for the property itself.

At the same time, a salesperson can no longer persuade a buyer to buy a property from the seller who offers him the highest commission, instead of referring the buyer to a property that gives him the best value.

Seah Seng Choon, a CEA member who is Executive Director of the Consumers Association of Singapore (CASE), shares: “There were cases in which salespeople got their clients to sell their houses to the salesperson’s relatives. In such a situation, the salesperson could have engineered the sale of the property to his relatives instead of informing the seller of the highest offer. Conversely, the salesperson could recommend that a buyer buy from his relatives at a price that does not reflect the market value, instead of recommending a property of better value.”

To avoid such situations, salespeople or agents are now required to declare their relationship with buyers and sellers. The purpose of such transparency is to minimise any possible conflict of interest, such as the abovementioned scenarios.

Michael Tan, Key Executive Officer and Executive Director at, concurs, saying that the CEA has managed to correct the misconception of the role of estate agent and salesperson.

“For example, if a landlord withholds the refund of a security deposit to a tenant for whatever reason, the latter may hold the landlord’s salesperson responsible. However, the landlord’s salesperson can only assist his client.

“They will be advised to seek legal consultation as to their rights and obligations according to the Tenancy Agreement, and try to resolve the matter through appropriate channels such as the Small Claims Tribunal.”

Black and white

Contracts are common in property transactions, but the CEA has gone a step further and drawn up a mandatory model contract to make absolutely sure agents offer fair contractual terms to buyers and sellers.

Highlighting the post-CEA improvement where contracts are concerned, Seah says: “Service contracts used to have auto renewal clauses, and sellers would be trapped when selling their property after the duration of the contract. They thought the contract had expired, only to be confronted with a letter of demand from the salesperson for commission. This is one of the many disputes CASE had handled before the CEA was formed.”

All-around progress 

Though the board has aided many consumers since its establishment, it has also proven beneficial to businesses. CASE is one such business. Seah says, “CASE deals with many complaints from the real estate industry, including those that the CEA currently deems as (involving) a breach of the law. We can now refer consumers with such complaints to the CEA. As such, we have received fewer complaints over the years.”

He also acknowledges that CASE and the CEA are “partners in educating the consumers”, as both organizations believe it is crucial to ensure consumers are equipped to protect their own rights and interests.

Tan has similarly positive sentiments: “OrangeTee endeavours to adopt best practices wherever possible, which must align with the CEA’s regulatory requirements. This helps to elevate (our level of) professionalism. As such, there is a greater emphasis on providing a high level of service for our clients. The effort eventually pays off, as happy customers are our best ambassadors.”

What is, and what is to be

It’s safe to say that the CEA has had an overall positive impact on the local property industry, both for consumers and professionals. Lee says: “The annual number of consumer complaints against salespersons has declined by two-thirds over the past five years, a result of our effective regulatory enforcement, professional development of salespersons, and consumer education. We have received positive feedback on their conduct, and are grateful to industry stakeholders for working closely with us to effect these changes.”

Despite this marked improvement in the industry, he believes there is room for more growth: “The CEA just turned five last month. It is a young and lean organization that has to regulate about 1,400 real estate agencies and license some 30,000 individuals.”

Over the next five years, the CEA plans to build further on its regulatory framework, focusing more on industry development to enhance its professionalism and customer service.

On its part, the CEA will review its practices to help reduce compliance costs and increase efficiency.   For instance, it no longer requires salespersons to display their registration expiry dates on their estate agent card. Consumers can now easily verify a salesperson’s valid registration period on the CEA’s Public Register (both online and via the mobile app).

Lee says, “We recognise that transformation of the industry will take time.  After all, five years is a relatively short period to fully transform an industry with 30,000 salespersons.

“There is certainly a need for the CEA to continue to work closely with industry stakeholders and partners, estate agents, and consumers to bring about further improvement. I look forward to this close collaboration in our continuous journey towards the vision of professional and trusted real estate industry for Singapore.”