If you provide real estate services, such as fee collection, you must hold a real estate agent or property manager licence. Depending on your state or territory, there may be specific rules regarding fee collection. For instance, the requirement to have a written agreement or ensuring unlicensed individuals do not receive specific fees or commissions. This article will break down the applicable laws in New South Wales, Victoria, Western Australia and Queensland, outlining the requirements when with assisting a real estate business in collecting fees.
What Are the Requirements in New South Wales?
Under the NSW Property and Stock Agents Act 2002, you must hold a real estate agent licence to handle property transactions such as:
- sales;
- leases; and
- management.
This licence will be sufficient for the collection of fees, including rent and property management.
What Type of Licence Do I Need?
Two types of licences exist: class one and class two. You must have a class two licence when assisting with fee collection. Obtaining a class two licence requires:
- 12-month assistant agent registration;
- supervised experience; and
- subsequent licensee experience.
Class two licences permit:
- property trading;
- negotiation;
- rent collection; and
- fee handling.
What Are the Requirements in Victoria?
The Estate Agents Act 1980 (Vic) makes it essential to have an estate agent licence when engaging in real estate activities such as:
- selling;
- buying;
- letting; or
- rent collection.
Furthermore, agents must:
- hold a written agreement;
- inform clients of commissions; and
- provide details of agreed fees.
Additionally, Victoria permits “agent representatives” to perform the functions of an estate agent. Agent representatives are unlicensed but employed by licensed agents and have defined roles and responsibilities. Agents are accountable for their representative’s actions and must detail their authority in writing.
What About Fee Collection in Victoria?
An agent cannot obtain or seek to obtain any payment from a person unless there is:
- a signed agreement;
- negotiation disclosure; and
- clear fee statements.
Additionally, the sharing commission requires a prepared statement indicating the sharing parties. Agents cannot retain rebates without client consent and must promptly transfer received rebates to clients.
Continue reading this article below the formWhat Are the Requirements in Western Australia?
Under Western Australia’s Real Estate and Business Agents Act 1978, a real estate licence is mandatory for negotiating property deals and rent collection. Additionally, an agent requires a licence and a triennial certificate for business operations.
Furthermore, in Western Australia, a “sales representatives” must be registered and can only carry out functions on behalf of a licence holder with a triennial certificate. Depending on the function of the sales representative, there are various registrations, including:
- unrestricted;
- sales-focused; or
- property management-focused.
An agent cannot receive fees unless they:
- have a licence;
- hold a current triennial certificate; and
- there is a valid appointment in place, which is in writing and signed.
What Are the Requirements in Queensland?
The Property Occupations Act 2014 (Qld) in Queensland defines licences for various categories, including:
- auctioneers;
- real estate agents; and
- resident letting agents.
Additionally, licensing is essential for activities like:
- property transactions;
- business deals;
- negotiation;
- complex lot letting; and
- rent collection.
Additional requirements in Queensland require agents to disclose relationships with referred entities and any benefits received.
Key Takeaways
Compliance with real estate law is crucial when assisting real estate businesses in fee collection. Depending on where you operate your business, the key requirements to ensure fee collection is handled lawfully include:
- obtaining the appropriate licences;
- maintaining written agreements; and
- ensuring adequate disclosure when necessary.
If you need assistance understanding the requirements in your state, our experienced real estate lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 1300 544 755 or visit our membership page.
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