More compliance for Real Estate Agents in NSW!

From 15 August 2016 NSW Real Estate Agents have new responsibilities relating to property inspection reports.

What does this mean for Agents?

Agents are required to keep a record of property reports and provide this information to prospective buyers when they ask for a contract for sale (regardless of whether or not the buyer asks for information about the reports).

Failure to comply may result in penalties of up to $4,400 for corporations and up to $2,200 in any other case.

Which reports?

• Building inspection reports
• Pest inspection reports
• Strata and community scheme inspection reports

What information is to be recorded for each report?

Agents must record the following details for each report that they are aware of or can reasonably obtain:

• The date on which the inspection was conducted
• Who requested the report
• Who prepared the report with their business contact details<
• Whether the report author has professional indemnity insurance
• Whether the report is available for re-purchase.

These records must be kept for 3 years.

Why?

The idea is to make it easier for buyers to obtain pre-purchase reports and reduce the costs of obtaining reports for properties they bid on but may not end up securing.

Buyers will have the option to be able to request an already available report at a reduced cost or request a new report with the knowledge that an inspector has already conducted a report on a particular property and negotiate a reduction in cost.

Do sellers have any obligations?

No, sellers do not have to tell their selling agent that any pre-purchase reports have been completed for their property and the seller does not have to obtain any reports.

Tim Smith

Senior Legal Advisor

Tim Smith is a Senior Legal Advisor at lawlab, a specialist legal services provider for property transactions large and small across Australia.