Do you trust everything your real estate agent tells you? Well, even if you trust him / her, it’s best to understand what you are actually buying. This is especially if the property is overseas where the rules and regulations may be different from the one at home. The reason is because sometimes, even the agent himself may not be sure and he may have given you wrong advice. In other words, he is not the one trying to cheat you but the end-party may cheat him and subsequently cheated you as well. Once the milk is split, it’s already too late to do anything.
One such incident was reported in propertyguru.com.sg. Singapore’s Council for Estate Agencies’ (CEA) Disciplinary Committee has fined SQFT Global Properties Singapore $10,000 (RM31,000) for failing to supervise the conduct of one of its former agents on the sale and marketing of a property in Auckland, New Zealand. The ex-agent, Paleenia Wong Mui Wah, was also fined $6,000 for misrepresenting facts of a purchase to an investor. Wong assured the investor that the money paid (NZ$65,000) would be kept safe in the trust account and that the developer could not withdraw it for other purposes than for construction. In June 2011, however, the developer took the money from the trust account without any construction having started on Albany Heights Villas.
Subsequently, the developer went into liquidation in February 2013 and the investor lost the money paid. Main reason for the fines, according to CEA was because neither SQFT nor Wong conducted proper due diligence checks on the ANZ account. CEA further shared the following, “Given the complexities and risks involved, consumers should find out and understand pertinent information such as the foreign country’s rules and restrictions on property purchases and ownership, whether the property has obtained approvals from the authorities, taxes payable, pricing and terms and conditions of the purchase, the foreign property market condition, currency exchange risks, etc.”
I think this case is a clear example that even when the industry is well regulated, in this case Singapore, the property purchase may still face issues because it was not in Singapore. Instead of assuming the agent or the agency knows best, buyers should also assume the responsibility. The loss is ultimately the buyer’s even if the CEA may fine the agency in the future. Stay safe dear Malaysian investors.
written on 8 Dec 2016
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