The Sales Coach eNewsletter

March 15 2005 Issue No. 54

Compliance Complacence, are You at Risk?
by Dennis McMahon and Narelle Stratford

Please note - this article and the examples shown are relevant to Queensland Australia. You may or may not have similar regulations in your area.

In a recent interview with Rod Felsch of Felsch & Associates Pty Ltd, (Real Estate Compliance and Audit Consultant), Mr Felsch stated that many experienced Real Estate Agents who were registered prior to September 2001 and Principals who employ them, are at great risk of breaching the PAMD Act, due to ignorance, complacence and non-application of the changes to the PAMD Act 2000 (Queensland legislation).  These two groups are especially singled out because they may not have stayed abreast of changes designed to protect consumers (both buyers and sellers), compared to those who received their Registration after that date.

In an interview with Mr Felsch, he revealed that many Principals are not maintaining adequate records of an employee's registration, and that an employee who has not notified the Office of Fair Trading of a change of address and contact details from one Agency to another, is in breach of the PAMD Act.  This may sound minor to the point of nitpicking, yet this is a legal requirement.

Now, read the following example:  "You're on desk duty and a prospective buyer comes in, and inquires about a property.  During the course of that interaction, you ask the buyer what their budget is, but fail to reveal before asking the question, that you are acting on behalf of your Client and will be passing that information on to your Vendor."    Now that you have read the example, are you in breach because you haven't informed the prospective buyer, or are you in the right, to stay silent?

Or, a prospective vendor phones and says they have a rental property in another suburb outside of your area that you work in, so you are unfamiliar with the property prices.  The caller is upset because another agency has not been putting good tenants in their rental property and has told this other agency that they are taking it out of their hands and selling the property.  You are the Agent who takes the call, and the caller insists that as long as they make a profit above what they paid for the property 10 years ago, they will be happy.  They tell you that the property cost $75,000 at the time, is a standard house block and has a small 3 bedroom home on it.

You say, you don't have a great knowledge of the property in that area, they say, just make me some money.  You do not go and look at the property, you do not do a search to ascertain current market prices, and you call a potential buyer and say "I think I've got a property for you".  2 days later you have a signed contract for $80,000 and your caller accepts the deal and says, "gee, that was quick".  Have you done your duty correctly, or should you have done something differently?  Would you be surprised if you were taken to Court or would you expect it?

To find out, send an email with your response, via the Contact Us.

Mr Felsch provided many examples that indicate that there are many of you who do not have a full and complete knowledge and understanding of the finer points of the PAMD Act 2000, which could result in fines of thousands of dollars, loss of licence and registration, and of course, the loss of business and reputation.

If you aren't completely sure of your legal standing or whether or not your Office and Agents complies with the Act, then call on 0412 251 196 or email for more information regarding Training and / or Compliance Audits to make sure that you don't jeopardise your business.  Should you risk it?

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