Rules of conduct for property professionals
These rules of conduct guide property agents on professional and ethical standards, with 21 core rules that apply to all, plus specific rules for different categories of agency work.
Key requirements for agents
Agents must:
- prove their competency before they are issued a licence or certificate
- undertake continuing professional development each year to make sure they remain up to date and competent in the skills and knowledge needed to do their jobs
- be insured under a professional indemnity insurance policy that complies with the requirements specified in the regulations. Download the professional indemnity insurance information sheet.
About the rules of conduct
The rules of conduct under the Property and Stock Agents Regulation 2022 (the Regulation):
- support agents' competency and professionalism
- provide professional and ethical standards for agents as expected by the public.
There are 21 core rules which apply to all licence and certificate holders, and additional specific rules which apply to the various categories of agency work.
The rules of conduct can be found in Schedules 1-4 of the Regulation as follows:
| Link to Schedule in the Regulation | Applies to the following licence and certificate holders |
|---|---|
| Schedule 1 | All licence and certificate of registration holders |
| Schedule 2 Part 1 | Real estate agents and assistant agents exercising functions relating to the sale or purchase of land, or business agent functions |
| Schedule 2 Part 2 | Real estate agents and assistant real estate agents who exercise real estate sale or leasing functions in relation to the lease of land, or on site property managers |
| Schedule 3 | Stock and station agents and assistant stock and station agents |
| Schedule 4 | Strata managing agents and assistant strata managing agents |
Other relevant laws and obligations
In addition to complying with the rules of conduct, agents and assistant agents have to comply with other laws, including the Property and Stock Agents Act 2002, in relation to their conduct and in carrying out their functions.
For example, strata managing agents also have obligations under the Strata Schemes Management Act 2015. Further information about strata schemes and their management can be found at disclosure requirements for strata managing agents.
There are 21 rules of conduct that apply to all agents. Some of these are:
- knowledge of the Act and Regulations – agents must have good knowledge of the Act and Regulations and all other relevant legislation that applies to the class of licence held.
- agents must always act with honesty, fairness and professionalism and not engage in conduct that may be misleading or deceptive.
- conflicts of interest- agents must declare any potential conflict of interest to clients and not enter into any commercial arrangement that would place their interests before their clients.
- fiduciary obligations – agents must act in the best interests of their clients at all times.
- referral to service providers – agents must declare to a client any personal, family or commercial relationship with the provider. The referral must be made only if it is in the client's best interests.
Examples of rules of conduct
Some examples of the rules of conduct are outlined below.
Gifts and benefits generally prohibited where there could be a conflict of interest
Section 53F of the Property and Stock Agents Act 2002 establishes a general prohibition on agents receiving or requesting gifts or benefits for themselves or for another person in circumstances that could reasonably be considered to give rise to a conflict of interest.
However, this does not apply to:
- anything provided by the agent’s employer
- anything provided as part of an agency agreement or as a gift of thanks from a client for services provided under the agency agreement, or
- anything of less than $60 in value - which is the same level as the dollar limit under the reforms to the laws governing strata managing agents that commenced in 2016.
The supervision guidelines also require principal licensees to maintain a register of gifts and benefits received by agents employed in the agency.
Separate trust accounts for rental and sales money
The licensee in charge of the business will need to establish a different general trust account for rental money and sales money. Rent and sales deposits must not be kept in the same general trust account.
Many businesses already maintain separate trust accounts for rental income and sales deposits; this rule mandates it for everyone.
This requirement aims to improve the accountability and transparency of agents by ensuring they do not mix rental and sales money in a single trust account.
Expression of interest deposits
An expression of interest deposit is made prior to the exchange of contracts and shows the vendor that the buyer’s offer is serious. It does not oblige the buyer to purchase the property, and it does not oblige the vendor to sell the property. Expression of interest deposits are refundable.
It is important that consumers are aware of their rights in relation to expression of interest deposits. To ensure this, the Regulation imposes rules on real estate agents (including buyer’s agents) and stock and station agents. None of them can accept an expression of interest deposit from a person (or, in the case of a buyer's agent, they must not pay an expression of interest deposit on the person's behalf), unless they have given the person the following information in writing:
- the vendor has no obligation to sell the property or business
- the buyer has no obligation to buy the property or business
- the deposit is refundable if a contract for sale of the property or business is not entered into.
Before the agent accepts the deposit, the person must give a signed written statement to the agent confirming they were given the above information, and they understand it.
The agent must promptly inform the person if a subsequent offer is made to purchase the property.
An agent acting for the vendor must also:
- advise the person that they have the right to make further offers until exchange of contracts has taken place
- refund the expression of interest deposit within 14 days once a contract for sale of the property has been entered into by someone else
- promptly inform their client that an expression of interest deposit has been paid.
Rules for rent bidding and advertising residential rental properties
The rules of conduct prohibit agents from soliciting rent bidding.
Real estate agents or assistant agents cannot solicit or invite an offer of rent that is higher than the advertised price for a residential rental property.
Tenants can offer higher rents for a rental premises if they do it voluntarily and freely.
Agents can accept a higher rental offer that is made freely and voluntarily.
Advertisements for residential rental properties must include a fixed price. They cannot be advertised with a price range, or text like 'offers from' or 'by negotiation'.
Signs used on or near the property which advertise that it is available for rent are not required to list a price.
These rules only apply to leasing of residential property.
A strata managing agent's fiduciary obligation to their client
An example of a strata managing agents fiduciary obligation to their client is that a strata manager must not accept a commission from a service provider unless proper disclosure is made to the owners corporation as prescribed in the Strata Schemes Management Act 2015. The disclosure does not void the potential conflict and the strata manager must also demonstrate to the owners corporation that acceptance of the service would be in the best interests of the owners corporation.