An Ethical Question

[eggnog]

Say I get a licence which makes me a RE agent. What implications will this have on me purchasing properties. Will I have to disclose to all buyers that I am a real estate agent. Would I be able to purchase properties from buyers that I source, are my clients or are clients of the agency I would work in. What about if I personally source my own clients (letterbox drops, door knocks, etc) to purchase properties without going through the agency.

I would like to better understand the implications before I decide to get trained for a licence.

 

[TheCamel]

I don't think you'd be required to tell anyone anything...

unless there was an interest in something you were managing for a vendor or buyer, etc..
if that makes sense ?

like, if you were selling propertyX, or your agency was, you'd need to declare an interest if you wanted to buy it

i think ?

 

[alexlee]

I was more thinking, does having an agent's license automatically make you an agent? I mean, if I actually operated as an agent and had a business as an agent I would think ethically you have to disclose. If I just happen to have a license, does that automatically mean I have to disclose?
Alex

 

[eggnog]

thats fair enough camel. But what if you did the personal approach in buying - say through letterbox drops. Will you still have to disclose that your an agent

 

[Alanna]

You need to understand the difference between a salesperson and an agent. An agent is a person who is licensed to carry on a real estate business and must generally be a salesperson in the industry for around 5 years before applying and studying for a triennial certificate. A salesperson works for an agent, an agent is licensed to do their own business.
The ethics or code of conduct varies between each state. Basically you can not buy any property, privately or via the business you MUST disclose that you are a licensed real estate sales person. This needs to be done in writing, the required timing of this varies between states. You must disclose this for every transaction. It is unethical to receive a commission for a sale in which you are a purchaser.
Also bear in mind that you must be employed in the industry to hold your sales certificate and the two yearly renewal must be also completed by a license holder saying that you are currently employed in the industry.

Hope that offers some more info.

 

[urban cowboy]

Heya CF, some answers for your specifics...

What implications will this have on me purchasing properties.
None - you have as much right to purchase whatever, wherever you like. when you are buying you are a private person just like anyone else...as opposed to that other thread a few days ago where the buyer declared he was an agent when it had nothing to do with the transaction.

Will I have to disclose to all buyers that I am a real estate agent...
not sure i understand your question...but simply if you are acting as an REA in the course of your business - people will know you're an agent. if you are acting as a private person - you being an agent does not come into it...

Would I be able to purchase properties from buyers that I source, are my clients or are clients of the agency I would work in...
you can...an agent is permitted to buy a property that is listed by their ageny but there is some extra paperwork and no commission payable. Who "owns" your clients will be determined by your agency policy and procedures, but in short your principal (business owner) decides what you can and can't do.

What about if I personally source my own clients (letterbox drops, door knocks, etc) to purchase properties without going through the agency.
again, a policy question for each individual office as to how they handle clients - not a legal one...but if you are using agency resources to source property i don't think the principal would be too happy. Otherwise, you're fine.


As for Allana's comments - most of that won't apply to you - its WA specific...it is good to know how other states operate though.

In Qld you can do either a Sales Certificate or a full Licence. there is no waiting periods or qualification periods etc...you can do either. The sales certificate takes a couple of days and allows you to perform the functions of sales person. Full full licence is a lot longer and allows you to run your own agency and manage a trust account etc...it costs a hell of a lot more.

For your purposes the sales cert. is just fine.

Our governing act is the Property Agents and Motor Dealers Act 2000 and it has a number of subordinate regulations and includes a code of conduct. Obey that and you'll be fine.

there is no duty of disclosure in Qld for agents buying privately.

ring the lady whose number i gave you the other day...she will explain it all for you with the correct legals and ethics etc.

hope this helps,
cheers
UC

 

[Dazz]

Nice post UC. I certainly picked something up from that.

 

[Ausprop]

wow, sounds like anything goes in Qld ! You would be hung up for that kind of activity in WA. most agencies just make a policy that you can't buy agency listings - far far too messy.

 

[urban cowboy]

It is messy, but it can be done...a little bit more to it than normal, but can be done.

 

[wylie]

Also messy when a family member wants to buy a house that the family member's agency has listed. I have done this and had to sign extra forms stating my relationship and family connection to the agency. Bit of rigmarole.

In the end, it was a waste of time because even though we offered $15K more than the other offer on the table and a clean, unconditional contract, we are 99% sure the office principal did not ever show our contract to the vendors. Long story, but one of the reasons I have low regard for some in the industry, though very high regard for the good ones.

Wylie