How Not to Break the Law as a Buyer’s Agent

It’s commonplace to hear stories about buyers who struggle to get enough information from their real estate agent to be able to submit a reasonable offer. You may also hear horror stories about sellers who don’t trust their own real estate agents enough to listen to their opinions. No wonder real estate agents don’t have the best reputation and don’t always offer the best outcomes for clients.

But as a buyer or seller, you may be comforted to find out that buyers are required to work within a legal framework. Plus, if you’re asking yourself should I become a real estate agent, it’s essential to know the different laws on the books that will affect your career. You don’t want to get a reputation for being untrustworthy and someone who doesn’t act in your client’s best interest. So, studying the necessary laws to understand your obligations is essential. Here is a closer look at some of the crucial laws of real estate in Australia.

1. Are Real Estate Agents Obliged to Present all Offers?

Real estate agents have a fiduciary duty to report all offers to the seller before the contract of sale has been finalised. However, there are exceptions to this rule. For example, if the seller instructs their agent not to submit offers under a particular dollar amount. Agents must also attempt to negotiate the best possible price for their clients.

2. Is It Legal to Use Real Estate Lists in Australia?

Yes, but only if the personal data owner has consented to its distribution. If a person has not consented to the processing of their personal data, then when using such data, your business in Australia can face a severe fine. So, you must know where your real estate buyers’ leads come from.

For example, Radius real estate lists are taken from real estate business partners whose clients signed an agreement on transferring personal data. But, be aware that the Internet is full of cheaper databases that could be obtained by hacking, which is fraught with obvious risks. So, if you purchase real estate buyers leads online, make sure it’s from a trustworthy source.

3. Can the Buyer’s Agent Represent You Without Permission?

No, it’s illegal for a buyer to obtain consent from the buyer before they are allowed to represent them in a transaction. However, some buyers agents Australia may say they have a property for sale when they don’t yet have a signed authority. They may do so because they are sure they will settle the cooperation with the property owner and want to speed up the paperwork. But this is a risk that agents often take. Getting leads in real estate often takes time, and many buyers’ agents may want to hit the ground running. So they may begin advertising the property before the agreement is signed.

4. What Obligations Does an Agent Have to the Purchaser?

Agents are responsible for being open and honest with their clients at all times.

That means if the agent is privy to certain information, they have a responsibility to present it to their client if they have reason to believe the client is unaware of it, and the facts may impact their decision-making.

Agents must disclose information about council approvals, disputes, corporate matters, and the property’s history (including murders or suicides). This includes any information that may impact the buyer’s purchase decision.

5. Is Gazumping Legal in Australia?

Although not always a recommended practice, gazumping is legal across Australia. Queensland is the only region to outlaw the practice. In the sunshine state, the agreement is binding as soon as the buyer makes a formal written offer to sell the home and the seller accepts.

Gazumping is a severe problem, but the lack of buyers’ understanding of the law and how contract signing works is usually what causes an issue.

However, buyers typically hold the agent responsible.

So you may want to keep a catalog of emails and written notes just to be on the safe side.

It’s also wise to be persistent and repeat yourself multiple times so that the buyer heeds your advice, especially in a market with plenty of competition. That way, the buyer can’t say they didn’t make the necessary effort.

6. When Can a Client Sue Buyers Agent?

A client can sue a buyer’s agent when they violate the laws of real estate in Australia. Problems and even lawsuits arise when agents fail to inform their clients of property-related issues. Any client can sue their real estate agent over omitting information regarding the sale and the property. Overall, real estate agents have a fiduciary responsibility to ensure that official processes like estimating a home’s fair market value and conducting a home appraisal are completed fairly and with the utmost professionalism.

Otherwise, they will face a lawsuit if the client thinks he/she spent money on a bad deal because the agent didn’t do their job.

So if you’re wondering how easy is it to become a real estate agent in Australia, the answer is likely more complicated than you think. You must understand all the local and national laws to ensure you don’t get sued. You must also put forward the best effort possible to serve your clients in the highest capacity. As long as you know the laws and do the necessary work, making a decent living in real estate is possible. But you must study hard, so you don’t end up breaking the law.