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Most people will need to hire the services of a professional for the different steps of buying and selling a property.
Finding a professional
Make sure any professional you hire is licensed to carry out the work.
Check the public licence register
Agents, sales reps and auctioneers must carry their registration when working and show it to you on request. The agent’s registration number is also displayed on any property advertisement.
Real estate and land agents
A real estate or land agent is usually involved in selling property on behalf of the seller. People can also sell the property themselves.
An agent can't act on behalf of both a seller and the buyer, but in certain situations, this is allowed if the buyer is given a warning notice.
What the agent does
- give a realistic selling price
- give advice about the best way to sell - for example, auction, by offer
- organise advertising and marketing
- organise and attend open inspections
- negotiate the final selling price
- prepare legal documents, for example contract of sale
- register bidders for the auction, including sighting their ID.
Your agent, their sales reps and associates - for example, a close family member - can purchase your property at auction. But they are not allowed to buy your property by making an offer unless they have been given approval by Consumer and Business Services. Approval will only be granted in exceptional circumstances.
Agent fees
- commission percentage of the sale price
- a set fee
- combination of both.
The estimated selling price is written in the sales agency agreement. This can only be a single dollar figure; price ranges cannot be used.
Sales agency agreements
You must sign a contract with the agent before the agent can sell your property. This contract is called a sales agency agreement.
For residential properties, the agent must give you a guide, Final sales agency agreement guide - form R1 - which outlines your rights and obligations under the agreement. After you have read and signed it, you must receive a signed copy, or if you both agree within 48 hours.
The agreement must state:
- how the property will be sold and the estimated selling price as a single dollar figure
- how long the agreement will be valid – up to 90 days
- how the agreement can be terminated
- any recent sales of similar properties or information the agent has used when working out the estimated selling price.
Fees and charges must also be included, such as:
- services the agent is to provide and all fees and charges
- marketing strategy and separate services charged – e.g. advertising
- nature, source and amount of commissions, rebates, discounts or other benefits.
Other information that must be included:
- whether the agent has authority to accept an offer on your behalf
- a statement confirming that the agent will comply with the Land and Business (sale and conveyancing) Act 1994 and will act in your best interests.
Provisions, fees and terms in the agreement can be negotiated. These must be put in writing and signed by you both. For example, there could be a commission penalty if the final selling price is less than the estimated sale price, or a bonus if the final price is higher.
Any changes to the agreement must be in writing and also signed by you and the agent. However, you cannot increase the acceptable selling price for auction sales.
Sole agency agreement
This is the most common type of agreement. It gives the agent the exclusive right to sell your property. The agent will be entitled to the agreed commission, even if you end up selling the house yourself.
If you withdraw your property from sale before your agreement ends, the contract might include a cancellation fee. Listing with a new agent if you cancel a contract early could mean you have to pay commission to both agents. Seek legal advice if you want to terminate an agreement.
General or open-listing agreement
Most agents won’t offer a general or open listing agreement because they could still have to pay their marketing costs if another agent sells the home.
With this agreement the agent is only entitled to the commission if they sell the property. You could open-list your property with several agents and you can cancel the agreement at any time by giving them written notice. The conditions of an open listed agreement should be included in the contract.
Extending a sales agency agreement
A sales agency agreement can be extended for up to 90 days if you are given both:
- a Notice of Expiry within 14 days of the original agreement expiry date
- the extension recorded in writing, signed and dated by you and the agent.
If the agent gives you this notice you can:
- give written notice that you don’t wish to extend the agreement
- agree to extend the agreement - for no longer than 90 days
- do nothing – the agreement will extend automatically, up to 180 days.
The agreement can only be extended once. After that, new agreements need to be made. During the extension period, you can end the agreement by giving the agent at least 7 days’ notice in writing. No reason needs to be given.
Auctioneers
A registered auctioneer must conduct all property auctions. The real estate agent will normally organise this for the seller.
The auctioneer will ask for reserve price to be set in writing. This is the lowest amount the seller will accept.
Before the auction
The auctioneer must:
- provide bidders with the bidders guide (PDF, 43.2 KB)
- make the collusive practices statement (PDF, 28.1 KB) available to view 30 minutes before the auction.
During and after the auction
The auctioneer will usually:
- announce and place vendor bids during the auction
- decide whether the auction will stop to allow latecomers to register to bid
- maintain a written record of the number of bidders, bids made and who made them
- announce and record the outcome of the auction
- negotiate with bidders if the auction was held over
- accept the highest bid if it is equal to or more than the reserve price.
Conveyancers and solicitors
Conveyancers and solicitors are the legal professionals who transfer the ownership of property from one person to another.
What the conveyancer or solicitor does
They prepare the transfer documents and complete the legal steps when someone:
- buys or sells property
- subdivides land
- registers, changes or removes an easement
- updates details on a certificate of title – for example when registering a death.
Do it yourself
You are not legally obliged to hire a conveyancer or solicitor but if you sell or subdivide a property yourself, you must:
- prepare all legal documentation
- make sure you fully understand relevant legislation and regulations that apply
- be aware of what is required for agencies that might be involved in the sale – for example, your local council.
You will not be able to lodge the documents yourself to transfer the property to the new owner. This can only be done by a conveyancer or solicitor with access to an electronic lodgement system.
