In brief - Changes commence on 15 August 2016
With little fanfare, the New South Wales state government has introduced new changes affecting the obligations of real estate agents in regard to property reports and price disclosures for agency agreements for residential property sales, and an exemption for certain commercial property agency work. The changes commence on 15 August 2016.
Register of reports for residential property for sale to be made available to purchasers
Real estate agents now have the obligation to maintain a register of various reports relating to residential properties that are for sale (being predominantly building reports, pest reports, and strata or community scheme reports) which must be made available to purchasers who ask for a contract for sale.
The records must indicate the date on which the property was inspected, details of the person requesting the report, details of the person who prepared the report, whether the report is available for repurchase and whether the person who prepared the report has a professional indemnity insurance policy.
Deregulation of commercial property agency work
A real estate agent is now exempt from the operation of the Property, Stock and Business Agents Act 2002
with respect to undertaking commercial property agency work on behalf of an affiliate of the agent or an entity that is a significant property owner (that is, one that has properties having a market value of $40 million or more or an aggregate gross floor area of 20,000 m2 or more).
Price disclosures for private treaty sale of residential property
Following industry consultation, if an agreement (usually an agency agreement) provides for a residential property to be offered for sale by way of private treaty, that agreement must specify the price of which the property is to be offered.
Legislative changes aim for improved governance and reduced costs for purchasers
Whilst imposing additional obligations on real estate agents, an exemption is given and these legislative changes are logical and obviously are part of good governance process for agents.
These measures also are aimed at reducing the costs for purchasers whom otherwise may incur significant costs in relation to reports on multiple properties they may be considering.
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