|i am referring to private properties|
My brother and I walked into a property showroom in Geylang. He got interested in a unit and so I lent my ears to the fantastic arrangement of buying a property.
I thought the arrangement should be - I like what I see at the price that I like, I sign the option to purchase and pay the 5% down payment first.
But the property agency ("Agency") and its agents ("Agent") have a different way of selling properties for the Developer/their client ("Developer"). Here is the process as I understand it. If any property agent is reading this, please feel free to correct me if I am wrong.
1. The Agent stressed that we have NOT officially launched the project and the price list is as SUGGESTED (only tentative/indicative) by Agency.
2. If we are interested in a particular unit, we will write a cheque (5% of SUGGESTED price) to the Developer's account to DEMONSTRATE our interest in that unit. (The Developer/Agency is asking prospective buyers to "shown hand" first in a poker game.)
3. After we wrote the cheque, Agency will put a small orange sticker on that unit. For some units, there were 3 or 4 stickers. Agents will use that "stickered" presentation to demonstrate to the next prospective buyers on the level of "hotness" the project is accumulating.. (I asked the Agent - who verify whether the stickers represent real interest.)
3. There will be a specific launch date, launch time and balloting time as determined by the Developer/Agency. (I am not sure when they decide on this. But if I were the Developer, I guess I will only LAUNCH when my agents have secured 3 or 4 cheques for each unit on offer.)
4. Half an hour before 11.15am on launch day, the Developer releases their FINAL price list. (If I were the Developer, I will obviously launch at a higher price given the many cheques/stickers collected.)
5. Agent will then attempt to call those who have shown their interest with their cheques. Agent's intention is to seek confirmation as to whether to put my brother's cheque into the "lucky draw" to be final purchaser of the unit.. ie. assuming more than one party has shown a willingness to proceed at the HIGHER Developer's price list.
However, if my brother decides not to proceed at the new Developer's price, we have the right to withdraw and the Agent will return the cheque with no further obligation.
6. But should my brother decides to withdraw AFTER being successful in the ballot, a penalty is payable.
7. My brother decides to proceed with the process. Agent sent a SMS to confirm our intention. He affirmed with a return SMS.
What if the prospective buyer did not received the phone call/SMS, Agent said the cheque will be withdrawn from the balloting process. (True enough.. after the balloting, we witnessed a family disputing viciously/vehemently with their Agent/Agency on the lost chance of getting a unit. For some reasons, they did not received any phone call.)
8. Balloting exercise subsequently ensue in the presence of anybody who manage to squeeze into the showroom.
9. For my brother's unit, he was duly informed of being the successful purchaser without any competing interest.
10. Normal sales & purchase arrangement follows. Bankers, lawyers, agent, CPF monies, talking about tiles.. follow.
Besides the above, what are my other concerns?
- Does any Authority need to approve the process of sale?
- Can the Developer/Agency vary the details of the process during the "soft" launch?
- What is "soft" launch?
- Should the sales process be explicitly presented somewhere in the showroom?
- Our Agent did a good job explaining the process to us. But it is not in black and white.
- I find it very uncomfortable having to write a cheque to show my interest. I thought a cheque is a promise to pay. You can be sued if that instrument is dishonoured.
- Isn't Developer and Agency the same party?