Note: All The answers should be For NSW.
CPPREP4002 – Access and interpret ethical practice in real
Case study 1
You need to set the price for a property you have listed for sale by private treaty in all the marketing materials.
The owners have advised they want $ 850,000 and have signed an agency agreement to reflect this price.
Consider the following situations and issues and, referring to the relevant legislation, explain any legal and/or ethical requirements in relation to property sales.
a) In marketing the price, you, as the agent recommend a price range of
Interest over $750,000
to attract more buyer interest.
b) A young couple Mark and Caitlyn Web showed interest in the property and have decided they would like to go ahead with their final offer at $ 837,000.
You have referred the buyers to your colleague who is a mortgage broker to help them with them finance.
As a result of the referral, the mortgage broker pays you a referral fee of 0.03% of the sale price for the business.
c) You are approached by a potential buyer who wants to buy the property, tear down the house, build two units and lease them.
He offers $750,000 and tells you that if you can get the vendor to accept this price, he will use your agency to manage the properties.
What are the possible consequences if you were to agree to the buyer’s proposal?
d) You are approached by a potential buyer who makes an offer of $750,000. You believe that the house will sell for more so you do not pass on the offer to the vendors. No other buyers come forward to with an interest to make an offer on the property.
Case study 2
Mr. Smith signed an agreement with agent Thomas Jones of Your Home Real Estate Pty Ltd and appointed the agency to market his home for sale at 24 Cherrytree Lane, Manly for an agreed listed price of $899,000.
At an open home you conducted on the weekend Thomas had several groups attend and asked them to enter their personal details into the open home register which was left on the kitchen bench for prospective buyers to fill in whilst they were viewing the property.
During the open home of the property, Thomas advised three different prospective buyers “It’s listed at $899,000, but I’m pretty sure that an offer of $850,000 will be accepted, because the owner needs a quick sale.”
After following up with all the buyers on Monday morning he also advised them of another property that he had listed and invited them to attend a private inspection he scheduled for the following afternoon.
a) Discuss the legislative and ethical breaches of this scenario referring to the relevant sections of Acts and regulations for your state/territory and commonwealth legislation.