Seacliff Park SA 5049
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Are all agents, sales representatives and auctioneers required to have qualifications and be registered with Consumer Affairs?
Yes, under the new legislation they must all be qualified and pay an annual registration fee. Sales representatives and auctioneers have until 21 January 2009 to register.
Previous legislation only required the registration of land agents. Sales representatives may register if they are undertaking training and are properly supervised. An Auctioneer must either be an agent who is also registered as an auctioneer or a sales representative who is also registered as an auctioneer. .
(ref. Land Agents Act sec 6-8C)
Do all agents and sales representatives have to carry their registration card?
The Land Agents Act 1994 sec 11B states that agents and sales representatives registered under the Act must at all times when performing functions as an agent or sales representative carry the registration card issued by the Commissioner and produce it if requested to do so by an authorised officer or a person with whom the person has dealings as an agent or sales representative. Maximum penalty $1250. Expiation $160
(ref Land Agents Act sec 11B)
Do the agent’s registration and contact details have to appear on each advertisement?
The legal entity (agent or agency) whose name appears on the sales agency agreement must have their RLA (license registration number) on every property advertisement for any land or business.
For example: John Smith 0456 785 393 Smith Real Estate 8445 3334 RLA 1234
(ref Land Agents Act sec 48A)
Is there a set period of time that has to be specified in a Sales Agency Agreement?
The maximum time an agreement for the sale of residential land can run is 90 days after which you would need to renegotiate a new agreement. You can nominate a shorter period of time e.g. 30 days or 60 days.
(ref LABSAC Regs sec 16A(1) )
How does making an offer on a property work?
- Agents are required to pass on all signed offers to vendors that are in the prescribed form within 48 hours or at a later time agreed with the vendor.
(ref LABSAC sec 21(1))
- Agents must take all reasonable steps to ensure the offer is in the prescribed form and signed by the prospective purchaser.
- Agents cannot pass on the offer to the vendor until it is signed and in the prescribed form unless there is insufficient time to do to ensure the vendor is aware of the offer.
(ref LABSAC sec 21(1))
- Agents are required to pass on a signed offer in the prescribed form even if it is below the advertised price or the minimum price the vendor will accept. (Agents cannot disclose the minimum price).
- Agents are not required to provide proof to the prospective purchaser that the offer has been passed to the vendor.
- If an offer is in the form of a contract for the sale of residential land in the prescribed form then the prospective purchaser will be bound if the vendor signs the contract.
(ref LABSAC Regs 16B)
- Agents must pass on all offers in the prescribed form regardless of an agent or vendor stipulation that the offer must be in the form of a contract.
- Agents and sales representatives are required to give copies of signed offers in the prescribed forms immediately to the person making the offer.
What should vendors know about the new pricing requirements for residential land?
- In the sales agency agreement the agent must specify their genuine estimate of the selling price, expressed without any qualifying words, as either:
- a single figure, or
- as a price range in figures with an upper limit that does not exceed 110 per cent of the lower limit. (ref LABSAC sec 24A)
- The agent is not required to disclose to the vendor how they arrived at their genuine estimate of the selling price. However a vendor is free to choose not to list with the agent on this basis.
- The vendor is required to state their selling price sought or a price acceptable to them as a single figure in the sale agency agreement.
- If a vendor does not specify a selling price in the prescribed form then the agent is not authorised to act on their behalf and is prohibited from doing so. (ref LABSAC sec 20 (1))
- An agent cannot market or advertise a vendor’s property for less than the ‘prescribed minimum advertising price’.
- Legislation does not require vendors to accept any offers; however, the agency agreement may require payment of commissions in a variety of circumstances.
- If the vendor wishes to advertise below the ‘prescribed minimum advertising price’ the sales agency agreement needs to be amended and signed by both parties.
- If the vendor receives an unconditional offer over their stated selling price in the sales agency agreement but rejects the offer then the agent may be entitled to their sales commission if the sales agency agreement makes allowance for this.
What can I expect if I intend to buy at auction?
Before the auction
- Attend open inspections.
- You will be given a Buyers Information Notice (Form R3) by the agent. It provides you with a list of factors to consider before purchasing, under the headings of Safety, Enjoyment and Value.
- Consider arranging a professional building inspection.
- Arrange your finance (loan), taking into consideration that you will have to pay a deposit on the day if you are the successful bidder.
- Read the vendor’s statement.
It must be made available to the public for at least 3(three) consecutive business days preceding the auction – the auctioneer must place a public notice advising of the times and places the statements will be available. It must also be available at the auction 30 minutes or more before the commencement of the auction.
Register to bid
- On the day of the auction the conditions and the prescribed standard conditions of auction must be made available 30 minutes or more before the commencement of the auction.
- An ‘auction record’ must be made by the agent.
It is a written record that must contain information specified in the Land and Business (Sale and Conveyancing) Act 1994 and Regulations e.g. the amount of each bid and the identifying number of the bidder.
- If you are intending to bid you will need to register on the Bidders Register.
You can register on the bidders register any time before the actual auction or on the day if the agent is accepting registrations. You will need to provide proof of identity – this can be a current licence, passport, credit card or an electricity or telephone account or similar documents. You do not need to leave the documents with the agent or allow them to make a copy.
- If you are intending to bid on behalf of another person then you must provide written authority to act and proof of the other persons identity if it is on behalf of a body corporate then the certificate of the body’s incorporation)
- If you are bidding via phone you will need to nominate and authorise someone in writing to attend the auction, register and bid on your behalf. You will both be required to provide appropriate ID documents.
- Everyone registering must be given a Bidders Guide (Form R4) and the Collusive Practices (Form R5).
- You will be given a bidders ID number that you will need to display every time you make a bid.
During the auction
- The standard conditions must be audibly announced by the auctioneer immediately before the auction commences.
- If someone arrives after the auction has commenced and wants to bid it is at the auctioneer’s discretion as to whether they will interrupt the auction and allow them to register.
- If vendor bids are made by the auctioneer (max of 3) they must be announced as being a vendor bid and the amount must be entered in the auction record. Vendor bids must be below the reserve.
- If you are the successful bidder you will be required to sign a contract for sale and pay a deposit (usually 10%) immediately after the fall of the hammer.
- If you made an unsuccessful bid at an auction where the property was passed in and you entered into a contract for that property before midnight on the same day as the auction, then cooling off rights do not apply.
- No cooling-off rights apply when you purchase at auction.
What is meant by cooling-off rights?
- In SA if you buy a property you have a cooling-off period that expires at the end of the second clear business day after the contract was made or the second clear business day after the Section 7 Vendors Statement is served.
- This does not apply if the property is bought at auction or if the land or business is offered for sale at auction but is passed in and a person who made a bid then enters into a contract on the same day. However if you didn’t make a bid then cooling-off rights would apply.(ref LABSAC Act see sec 5(7))
- If a property is bought prior to auction then cooling-off rights do apply.
- You can cool off in the form of a simple letter that identifies the contract and is signed by the purchaser or by someone authorised to do so on their behalf.
- The cooling-off notice must be served before the prescribed time in one of the following ways:
- served on the vendor by giving it to the vendor personally (anywhere)
- served on the vendor’s agent at the office of the agent by giving it to the agent personally or by leaving it for the agent with a person apparently responsible to the agent
- served on the vendor by posting it by certified mail to vendor’s address
- served on the vendor or vendor’s agent by faxing to the number provided (proof of faxing document lies with the purchaser).
Where a purchaser has validly cooled off and the deposit did not exceed $100 (or other amount fixed by the regulations) the deposit may be refunded.
However, in this situation the vendor may retain money paid by the purchaser.
(ref LABSAC Act sec 5 (4)2 (a)(b))
This information has be taken directly from the OCBA website