Concern in Singapore after leaked emails show real estate agents using unethical pressure tactics

With the property sector showing signs of a slowdown concerns have been raised over scare tactics revealed in the emails. They suggest real estate agents have been trying to badger clients into selling at a lower price.
 
The emails appear to be correspondence between agents of real estate firm ERA.
In one email, a senior division director drew attention to a news report on land released for private homes. He called on agents to use the news as ‘a bargaining point to lower down your private residential seller’s high expectations’.
 
In another a real estate agent claimed that a deal was closed after telling the client that the ‘market is going to crash’, cashing in on fears that the government is selling too much land and the economic crisis in Europe could impact on Asia.
 
Industry observers said the gap in expectations between buyers and sellers is widening due to mixed sentiments in the market but the economy in Singapore is strong and interest rates low. Also the number of domestic buyers is increasing, suggesting more confidence in the market.
 
ERA said it did not have specific guidelines on how agents should communicate with clients but stipulated that information must be factually correct. ‘It’s a matter of perspective. One person’s impression may be that if the market drops by 10%, the market is crashing. Another person might think a drop of 10% is nothing,’ said Eugene Lim, associate director of ERA Asia Pacific.
 
‘Most sellers are very well informed and because of the availability of information from the media and the government, I think most people would have sufficient information to form an opinion,’ he added.
But some said such language is not condoned.
 
But the Singapore Accredited Estate Agencies said there is concern about the language used. ‘By telling the seller that the market is going to crash, it will make the seller worry, and ultimately they will sell at a price below their expectation. This conduct is not condoned by the industry. Instead, the agent should provide more comprehensive analysis of the market condition,’ said Steven Tan, advisory committee member of the SAEA.
 
The Ministry of National Development (MND) is currently looking into setting up a new statutory board, the Council for Estate Agencies, to implement a new regulatory framework for the real estate agency industry, so as to better safeguard consumer interest and to raise the professionalism of the industry.
 
The new framework will include a Code of Ethics and Professional Conduct, which estate agencies and agents must adhere to. Unethical pressure sale tactics or using unsubstantiated information about the property market will constitute as misconduct under the Code. And consumers who feel they have been disadvantaged or misled by estate agencies or agents can report to the CEA.