Raising professional standards in strata and property services agencies event resources

Fair Trading will initially take an educative approach to compliance with genuinely new requirement of the Supervision Guidelines. We have not announced a formal grace period as such.

It is important to remember that the overall legal obligation for principal licensees and licensees in charge to properly supervise their business has not changed. Some specific requirements have changed, and we have highlighted those on the Fair Trading website and in our communications to industry. Principal licensees should move as quickly as possible to implement those new requirements.

If there is a failure of supervision which has a negative impact on NSW consumers, it is important for all industry stakeholders that this is addressed. Our preferred approach is education to assist professional businesses to meet their obligations.

The overall legal obligation, under the Property and Stock Agents Act 2002, for principal licensees and licensees in charge to properly supervise their business has not changed.

Some requirements set out in the Supervision Guidelines have changed and they have the force of law.

The Supervision Guidelines apply to all agencies and all parts of the business are required to be supervised. Operational procedures are required in all agency businesses, but they will be more extensive where employees are engaged, and less so if you are a sole practitioner.

For example, every agency regardless of size must have written procedures of some sort that ensure all laws applying to the business are complied with.

Another example directly applicable to sole practitioners is the training plan requirements in section 2.4.2 of the Supervision Guidelines.

The expectation is that the business remains supervised and in practice this means that whoever the licensee in charge is, they retain responsibility and accountability for supervision.

If for some reason this is not possible due to extended absence or inability to perform these functions, arrangements will need to be made for an interim licensee in charge to be appointed.

There is no requirement to be on location at all times, provided the requirements are met.

Yes. The Supervision Guidelines are a set of rules issued by the Strata and Property Services Commissioner and apply to all licensees.

Operational procedures is a document you create which governs the govern day to day operations of your business and staff. The Supervision Guidelines tell you the minimum things that must be included in your operational procedures.

No. See answer to previous question.

The Supervision Guidelines apply to all licensees in NSW, including commercial real estate agents. There are be some aspects of the Supervision Guidelines that are not relevant to commercial agencies — for example, rules on price representations and underquoting of residential property.

All property services business must comply with the supervision requirements as set out in the Property and Stock Agents Act 2002 and the Supervision Guidelines, including real estate agencies, stock and station agencies, and strata managing agencies.
There will be differences in implementation of the requirements across different types of businesses.

Refer to Section 2.5.4 of the Supervision Guidelines where this is clearly laid out.

Yes, provided you can also identify this is who you are receiving instruction from.

They should record they have sighted the documents, noting the specific documents that were sighted. The requirements here have not changed as compared to the Supervision Guidelines that were in force before 1 July 2024.

In this case you should identify the person who has the legal right to act on behalf of the owner, as well as verifying they have the right to do so.

Operational procedures for the business will identify the requirements within the business. There is no legal requirement for the licensee in charge to check and complete the proof of ID, noting the supervision requirements include having appropriate induction and procedures in place.

No, the Supervision Guidelines do not include any specific requirements relating to electronic signatures, which in NSW are a valid and legal form of signing and executing documents.

This depends on the nature of the arrangement. If the contractor is not under the supervision of the licensee in charge, then the contractor would need to be the licensee in charge themselves of their own business. Otherwise, they would need to be under the supervision of the licensee in charge.

The licensee in charge must supervise all parts of the business, including supervising other class 1 licensees.

When in doubt, record it. Licensees in charge should reference the guidance and requirements in 2.5.2 of the Supervision Guidelines with respect to the register of gifts and benefits. All licensees and assistant agents must also be aware of how the current laws affect real, perceived or potential conflicts.

Section 53F of the Property and Stock Agents Act 2002 provides that “the holder of a licence or a certificate of registration must not request or accept a gift or other benefit for the holder or for some other person in circumstances that may reasonably be considered to give rise to a conflict of interest”.

There are some exemptions to that overall prohibition, including anything that has a value less than $60.

The Supervision Requirements are not geographically limited and apply to all staff. Remote supervision can work, so long as the legal requirements for proper supervision are met.

Supervision Requirement 3 does not require reporting of breaches to Fair Trading. The requirement is for licensees in charge to make records of breaches of the agency’s operational procedures, including the corrective action you take. This is set out in section 3.1.2.

However, the law requires that certain specific breaches, such as a business having no licensee in charge or a failure to account for money held in trust, must be reported to NSW Fair Trading.

Fair Trading will determine compliance with the Supervision Guidelines based on information and documentation gathered from the agency when requested by ensuring the Supervision Guideline and section 32 of the Property and Stock Agents Act 2002 are complied with.

When auditing an agency, the licensee will be requested to produce copies of the required operational procedures documents along with supporting evidence to establish the procedures have been implemented, utilised, updated as required and are complied with.

Money received by a licensee (in the course of the licensee’s business) on behalf of another person must be deposited in a trust account as required by section 86 of the Property and Stock Agents Act 2002. If you do not receive money on other people’s behalf in the course of your business, then you do not need to operate a trust account and so the trust account requirements in the Supervision Guidelines do not apply to you.

No, CPD completed before 1 July 2024 is not relevant for the CPD year that starts 1 July 2024 and ends 30 June 2025.
Also note the term ‘points’ is no longer being used. The CPD requirements refer to compulsory topics that must be completed.

Underquoting remains a consistently high-profile issue in the media and for consumers. Fair Trading is carrying out increased, targeted compliance action against agencies suspected of systematic underquoting.

Alongside that, it is important to provide an additional level of confidence for consumers that the professionals they engage with are operating at or above minimum professional standards, with the detailed knowledge needed to comply. At a time where market pressures and declining trust are evident, this is a step towards increasing confidence and transparency which is in the interests of all stakeholders.

The course will be available shortly. Approved providers are not delivering the course – it will be available on the TAFE NSW learning platform only, where a 50% discount will apply to anyone completing the course in the first three months of it going live.

Class 1 and 2 licensed agents who are engaged in any residential real estate sales will be required to complete the course.

While this can be developed in a format preferred by the licensee in charge, it should cover the requirements listed in the Supervision Guidelines at 2.4.2.

It needs to clearly identify who requires training, the obligations they need to meet (topics or units of competency), training attended, training provider, hours of training, and completion (or otherwise) of courses and assessments.

There is also a new requirement in the Supervision Guidelines that started on 1 July 2024.

Training plans prepared by licensees in charge must also now include other training to ensure the licensee in charge and all licensees and certificate holders under their supervision maintain their knowledge of legislation relevant to the agency business, in compliance with Rule 1 (Knowledge of Act and regulations), Schedule 1 to the Property and Stock Agents Regulation 2022. This is in section 2.4.2 of the Supervision Guidelines.

This would only be required if they needed to demonstrate completion within a CPD period where they were under the supervision of the licensee in charge.

Individual licensees must keep records of the compulsory CPD they have completed for a minimum of three years.

The basic requirements is for all licensees must complete a minimum of five hours of compulsory CPD training, with an approved provider, on a minimum of four compulsory topics for your licence category.

In the example given, if a property manager starts to engage in residential sales work during the 2024-25 CPD year, it is recommended they also complete the online TAFE course on price representations and underquoting.

There is further guidance on the Fair Trading website for people who obtain a new licence during the CPD year – their CPD requirements are reduced depending on how much of the CPD year has already passed.

No. There will be additional training required for a person who holds more than one licence type.
The principle is that you do not need to complete the same training twice, however in some cases you will need to complete additional case studies to cover the learning outcomes required in all compulsory topics applicable to the licences you hold.
There is guidance on the Fair Trading website on how the various compulsory topics overlap.

The main obligation of a licensee in charge is to ensure licensees and certificate holders under their supervision are compliant during the time they are employed in the business.

It is a condition of all licences, whether the holder is currently working in the industry or not, to complete the CPD requirements issued by the Strata and Property Services Commissioner each year.

Financial arrangements relating to CPD are a commercial matter for the business to decide.

The obligation to complete the CPD training is on each licensed agent as it is a condition of their individual licence.

The licensee in charge has an obligation to prepare a training plan and engage with agents they supervise to ensure they meet their obligations.

NSW Fair Trading conducts surveillance of training providers, and they are required to report to NSW Fair Trading annually. This includes method of delivery, who they trained, dates, times and topics.

Training providers who fail to meet the delivery requirements for CPD each year, as well as the conditions of approval, can have their approval to deliver compulsory CPD topics revoked.

Yes.

This depends on the duties and responsibilities of the staff and whether or not they are involved in any functions where licensing is required.

Generally, administrative, reception and accounts staff do not need to be licensed.

No, there won’t be any blanket extensions applied after this time. The only extensions will be for exceptional circumstances applied for and assessed on a case by case basis.

No changes are planned.

Overquoting is an offence just like underquoting but governed by different parts of the law.

Section 2.5.5 of the Supervision Guidelines clearly sets out the legal obligations on licensees and assistant agents, including the overarching prohibition on false or misleading representations to any party to a transaction, including vendors.

Commercial arrangements with your landlord clients are a matter for the business to decide unless they breach legal obligations.

These will be reflected in agency agreements if additional services are being provided related to the transaction.

The rules under residential tenancies legislation on what can be charged directly to tenants are not changing.

No. Trust money means money received for or on behalf of any person by a licensee in connection with the licensee’s business as a licensee.

Requirements relating to estimated selling prices apply to the selling agent for the vendor, not an agent for a prospective buyer.

Section 29 of the Property and Stock Agents Act 2002 requires the licensee who is carrying on the business at the premises to display their name and description as a licensee, as well as a description of the kind of licence/s that they hold. The corporation licensee must also include the name of the person in charge of the corporation.

The law does not require you to display the names of every licensed agent who works at those premises.

If a corporation operates with other corporations and licensees working in conjunction, then those corporations and their licensee in charge, must do the same. For these additional details, they can be displayed anywhere outside the office as long as they are legible, clear and visible. They do not have to be displayed as prominently as the main corporation or licensee in charge which is generally on the front door.

As a result of the 2020 law reforms, there is no longer a licence category restricted to business broking only. The work experience requirements in the Qualifications Order issued by the Minister recognise this and now provide for a pathway to an unrestricted real estate agent’s licence. If a person is to obtain a class 1 unrestricted real estate agent’s licence then they must have qualifications and experience in real estate sales and leasing, including the operation of trust accounts in accordance with the law.

If you would like to share details of your own circumstances, please email to the Office of the Strata and Property Services Commissioner: propertyservicescommissioner@customerservice.nsw.gov.au

We can’t comment on individual situations. If you are acting as an agent for the sale, purchase or leasing of any land, you must be licensed. This includes residential, retail, commercial and rural property.