Buying or selling property

This term should not be used lightly in advertising because it would be reasonable that the reader of any advertising where there is a claim to be a “property expert” should have certain expectations.

According to the Macquarie Dictionary, an ‘expert’ is defined as:

“Someone who has special skill or knowledge in some particular field; a specialist; authority: a language expert; an expert on mining.”

If a sales representative is labelling themselves as ‘an expert’, you should expect that they have completed all the required training and registrations, have a wealth of experience working in the market and that they have an in-depth knowledge of their local area with a proven track record of success.

The sales representative you deal with should be able to comfortably answer the following questions:

• When did you initially receive your government registration?
• How did you gain your on-the-street training?
• What is your role?
• How long have you been conducting transactions?
• How have you gained knowledge of this particular locality?
• What are the trends in this particular locality?
• What is the typical profile of prospective buyers and what are they looking for?
• How do you determine the market value of a property?
• How many transactions have you conducted in this locality in the last six months?

Generally the only funds held during the purchase period is the deposit that is put down as part of the offer, which is usually held by the selling agents in their trust account. The balance of the purchase price is usually paid at settlement.

If you are paying in cash, then your settlement agent would arrange a bank cheque to be handed over at settlement to the seller’s settlement agent on the day of settlement. If you are financing it through a bank, then they hand the funds over on the settlement day to the seller’s settlement agent.

The settlement agents and a representative from the bank usually meet at a designated place and time on settlement day to finalise it all.

In order to secure the sale of a property, a common condition of the Contract for the Sale of Land/ Strata Title is that the seller will receive a deposit from the buyer.

This deposit is generally 10 per cent of the selling price, but this can vary case by case.

When a deposit is required, the seller nominates who holds the deposit (usually the seller's agent) in trust until settlement.

The seller's agent may comply with a request that the deposit be placed in a separate interest earning account if they are satisfied the deposit exceeds $20,000 or that the transaction is not to be settled within 60 days.

The seller's agent cannot release a deposit without the agreement of all parties.

If a deposit is required but not received by the nominated date then the seller can terminate the contract and proceed with any other offers.

A conveyancer, or also known as a settlement agent, is granted a license by the State Government that enables them to arrange for the transfer of legal ownership of property.

Each party to a contract for the sale of land normally appoints a conveyancer to act in their best interest. The conveyancer ensures that the necessary procedures and documents are signed and lodged to enable the transfer of ownership to occur when the agreed purchase price paid.

The appointment and the agreement to a fee for services is normally made when the buyer and seller have signed the contract for the sale of land.

In preparation for the transfer of ownership, the conveyancer may perform the following functions:

• Searching land titles and dealings in the records of Landgate to ensure that the seller is the registered proprietor of the land and is able to transfer ownership.
• Identify the person purporting to be the seller.
• Searching and inquiring at government and local government offices to determine if records, plans and policies affect the property.
• Making inquiries with respect to the adjustment of local government rates, water rates, taxes and other outgoings such as strata levies.
• Determining if any rent needs to be adjusted.
• Determining if any contractual conditions need to be satisfied.
• Preparing a settlement statement and an authority for the payment or receipt of monies.
• Arranging the payment of duty (previously called stamp duty) and any other imposts or fees on documents.
• Arranging and attending the settlement, including exchanging documents and receiving and disbursing monies to affect the settlement.
• Lodging documents to enable the registration of the new owner with Landgate.
• Reporting on the progress of the settlement to the designated party (buyer or seller).  

The completion of a real estate transaction can be a complicated process so it is important that a conveyancer with the necessary set of skills to complete the transaction is appointed.

A Selling Agency Agreement is a written agreement whereby the agent is authorised by the seller/owner to find a buyer for a particular property. The agent is required by law to have written authority.

REIWA produces standard Selling Agency Agreements for use by its members. These agreements are worded to equally protect the rights and obligations of the seller/owner and the agent.

The Selling Agency Agreement will detail the name of the seller/owner, the property details, the agreed fee for the agent finding a buyer, terms and conditions detailing the rights and obligations of seller and agent, and any agreement relating to the seller contributing towards the costs of marketing the property.

REIWA's standard exclusive agency agreements have received authorisation from the Australian Competition and Consumer Commission (ACCC).