What is the difference between property agents and real estate negotiators?

Sorry to burst your bubble, but an agent is not the same as a negotiator in Malaysia. No worries, check out our beginner’s guide to get an explanation plus a few helpful tips!

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Do you hear that siren’s call beckoning you to start a career in the real estate industry? Buying and selling properties can be both rewarding and difficult. The high-flyers bring home six-figure salaries, some earn enough while others only get a few thousand per year. Those who are used to a 9 to 5 job might want to kiss this dream goodbye. Leads will not fall into your lap just like that, you are going to have to hustle, and hustle hard.

Are you still with us?

Before you jump into this exciting and challenging industry, here are 3 important things you need to know about being a real estate agent and a negotiator.

1. The difference between a real estate agent & a negotiator


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The real estate agent (REA)

A REA can own and operate his/her own real estate agency and can employ up to 30 real estate negotiators to assist with the provision of real estate services. These include selling, leasing or searching (buying) a property for clients.

NOTE: Each REA can now hire a maximum of 50 RENs – The previous number was only 30. If the firm has more than one REA, the REN numbers will then be multiplied accordingly.

Given their seniority, a REA is required to possess the necessary academic qualifications and meet the minimum experience, standards and expertise set by BOVAEAP. This includes the Real Estate Diploma Course, a comprehensive set of examinations where there are 12 papers altogether. Applicants will have to obtain a pass for all 6 papers in Part 1 before being allowed to proceed with Part 2.

The exams will be followed by 2-year working experience with an existing agency as a Probationary Estate Agent (PEA) and finally sitting for the oral test of professional competence (TPC). Detailed information pertaining to the procedure involved can be found here.

Once completed, a REA will have his/her name on the Board’s list as a registered estate agent. A REA will also have to apply for a license to set up his/her own agency. A REA will have to carry a formally issued ID tag. This blue-coloured tag will bear the agent’s and agency names as well as an E number (E XXXX).

  • Real estate negotiator (REN)

A REN is employed by a registered estate agent. Since they do not manage the business themselves, they are not required to obtain a registration under BOVAEAP. However, these individuals must attain the necessary certification before they are allowed to practise. Every REN must attend a full 2 days course, called the Negotiator’s Certification Course, in which they will be taught the basics of estate agency as well as the related laws, Acts and standards pertaining to the industry.

Upon completing the course, they will be issued with a certificate of attendance, with which they can look and apply for employment with a registered agency. The employer (firm) will then apply for the REN tag from BOVAEAP.

MORE: My tenant is not paying rent. What can I do as a landlord?

Once the negotiator has obtained his designated tag and issue number (REN XXXXX), only then can he or she start representing sellers, landlords, buyers and tenants.


A sample of REN tag from BOVAEA.

The Quick Respond (QR) code on the REN and REA ID cards can be verified by a customer using a smartphone. It contains all the negotiator’s information including his/her photograph. Alternatively, the customers can call BOVAEAP during office hours at 603-22876666.

CHECK OUT: How to buy a house in Malaysia in 12 steps

2. Rules a real estate agent and real estate negotiator must follow


© Mohd Kafii Isa / EyeEm/ Getty Images

Before you ask, “Aiya, why do I have to get a certification? I can just start marketing my services on social media or word of mouth. Well, please note that the Malaysian real estate industry is regulated.

Both agents and negotiator must be registered with the Board of Valuers, Appraisers, Estate Agents & Property Managers (BOVAEAP), the industry’s governing board in Malaysia, which is under the purview of the Finance Ministry.

  • A REA is only allowed to represent one party in a transaction, either the buyer or seller. A REA is bound by codes of conduct and strict laws under the Valuers, Appraisers and Estate Agents Act 1981 (Act 242). Any registered REA or firm that commits any wrongdoings will be subjected to BOVAEAP’s disciplinary action which includes fines, suspension or deregistration.
  • All advertisements in newspapers and property portals posted by a REN must contain the Firm’s E registration number, firm’s telephone number, firm’s name and REN numbers beside his/her mobile number. The public can easily cross-check any REA’s or REN’s identity through BOVAEAP’s websites; www.propertyagent.gov.my and www.lppeh.gov.my.
  • Agents and negotiators are prohibited from placing ads on tree trunks and lamp-posts. Illegal brokers who put up ads (without REN numbers) and commit any other offence under Section 30(i) of Act242 is liable upon conviction to a fine not exceeding RM300,000 or imprisonment for a term not exceeding 3 years or both.

Also, illegal ads verified by BOVAEAP will be followed up with a communication to the  Malaysia Communication and Multimedia Commission (MCMC) who will then suspend and bar the mobile number.

More information can be found here.

READ: How to sell a property in Malaysia in 8 steps

3. How much commission can I earn?

Malaysia money ringgit bill in hand

© Ekachai Wongsakul | 123rf

i. As per the Seventh Schedule (Rule 48), the maximum commission fee is 3% for the sale or purchase of land and buildings.

This figure applies to other services rendered by the firm, such as a joint venture, sale of company and property swap. For chattels including plant and machinery, a fee of 10% on the proceeds is chargeable.

However, these subject to a minimum fee of RM 1,000 per property.

Meanwhile, the fee for the provision of sale and marketing services is to be agreed upon between the estate agent and client

ii. For lettings or rental properties, the following maximum amounts are chargeable for tenancies:

  • Up to 3 years: 1.25 months gross rental
  • >3 years, up to 4 years: 1.5 months gross rental
  • >4 years, up to 5 years & >5 years: 1.75 months gross rental
  • >5 years (with an option of renewal): 1.75 months gross rental plus 0.25 months rental for every additional year

*Subject to a minimum fee of 1-month rental & this scale does not apply to serviced offices or apartments or any other premises of a similar nature. For tenancies less than a year, the fee can be calculated using a pro-rata basis.

Well, there you have it – all the best in kickstarting your real estate agency career!