A NSW Fair Trading spokesperson said:
“Changes have been made to tighten up and strengthen the existing underquoting, supervision and responsibility provisions.
“This should not have any impact on how real estate licensees work or on how real estate agencies structure and operate their businesses.
"Their responsibilities regarding underquoting are effectively the same, and the penalties remain the same. If a real estate agent breaches the underquoting laws they could face a fine of up to $22,000 and could also lose any commissions or fees for the sale of the underquoted property.
"The changes will ensure that licensed real estate agents and their employees are captured by these laws regardless of what kind of employment arrangements are in use.
“This will also reinforce the effectiveness of NSW Fair Trading’s compliance and enforcement activities, and will ensure the consumer protection measures are not undermined.”
What changes to the underquoting laws have been made?
The
Property, Stock and Business Agents Act 2002 (NSW) has been amended to include changes to the underquoting provisions in particular. Some of the amendments include:
Section 73A - Underquoting representations made by real estate agents
Section 73A(1) and the penalty to section 73A(1) has been omitted and replaced with the following:
(1) A real estate agent or any person engaged by a real estate agent must not, in the course of marketing a residential property, make any statement to any person that indicates or suggests that the property may be sold for a price that is less than the estimated selling price for the property.
(1A) A real estate agent must ensure that any person engaged by the real estate agent does not, in the course of marketing a residential property, make any statement to any person that indicates or suggests that the property may be sold for a price that is less than the estimated selling price for the property.
(1B) It is a defence to a prosecution for an offence under subsection (1A) if the real estate agent establishes that the real estate agent took all reasonable precautions against committing the offence.
Section 73B - Real estate agents to keep records of quotes
The following sections have been inserted after section 73B(1):
(1A) A real estate agent must ensure that any person engaged by the real estate agent who makes a statement, in the course of marketing a residential property, of a kind referred to in subsection (1) makes a written record in accordance with subsection (2).
(1B) It is a defence to a prosecution for an offence under subsection (1A) if the real estate agent establishes that the real estate agent took all reasonable precautions against committing the offence.
What are the reasons for the amendments?
The reasons for these latest amendments to the Act are as follows:
(a) to ensure that certain controls applying to property, stock and business agents who are employers and to their employees also apply to agents who engage staff under non-traditional employment arrangements and to those staff (including independent contractors);
(b) to strengthen obligations for persons exercising functions as property, stock and business agents to be licensed or hold a certificate of registration under the Act by ensuring that persons carrying on business as property, stock and business agents may only engage staff who are licensed or hold a certificate of registration; and
(c) to strengthen obligations for property, stock and business agents to ensure that their staff are properly supervised and that those staff comply with requirements under the Act.
For more information on the changes to the PSBA Act,
visit here.