a) management is to attain the best tenant

a)

Identify the various business ownership option and services
offered by real estate agencies:

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Real estate agencies work with property – to either buy,
sell or manage. This comprises of residential (houses and apartments),
commercial (offices and hotels), rural (farms) and industrial (warehouses and
factories) properties. Different specialized agencies in real estate industry
provides an array of services including: Residential sales, commercial sales,
industrial sales, business sales, residential property management, project
management, commercial, industrial and retail management, strata management and
community management, stock and station agency, buyer’s agency, on-site
residential property management, holiday lettings and valuations.

Outline of typical organizational structure for a real estate agency

Figure 1:
Organizational Structure of a Typical Real Estate Agency

Overview of agency staff roles and responsibilities including admin, agents
and its representative and management. Legislative liabilities and
responsibilities:  

 

The Office of Fair Trading dictates the requirements and
eligibility by Property, Stock and Business Agents Regulations 2002 and 2003.

The agent who has
completed their certificate of registration can work as a real estate
salesperson, stock and station salesperson, business salesperson, property
manager, registered strata manager or registered community manager and a
registered on-site residential property manager. To complete the registration,
the person must be at least 16 years of age; fit and proper to hold a
certificate of registration (established by a police check); have a
qualification required for the class of certificate of registration concerned
and; should not be disqualified person.

 

The support staff in the
real estate agency may or may not require the registration certificate
depending the role they perform or whether they undertake the functions of a
real estate agent. Any staff member that is in contact with the client and
customers of the agency must be registered. The following are the main roles
and responsibilities of the property management team:

 

·        
Management – The aim of property management is
to attain the best tenant for the property and rent it at a fair price as quickly
as possible. The agent must meet the requirements of landlords as listed in
landlord’s instruction form. The principal is someone who client pays and get
into a written agreement for the use of the services provided by an agency.
This is the Management Agency Agreement. The principal must give the agent an
authority to act on their behalf. The agreement gives the principal and
therefore its agents the right to act and negotiate on behalf the client and
enter the client into a contract with third party. This means that agent can
find suitable tenants for the client and negotiate with them. The agent can
sign the lease on behalf of the client. The lease is the Tenancy Agreement. The
agent manages the property and tenancy as agreed upon the management agency
agreement.

·        
Principal – overlooks the property management
and sales department by giving agents an authority to act on his behalf. At all
times agents – both sales & property management and the principal has
fiduciary duties towards each other. At all times the agents will be loyal to
the principal and in return the principal will disclose all the relevant
information to the transaction and pay agent the commission or fee as agreed

·        
Property manager – is the main point of contact
for landlord and will be responsible for the operation of a portfolio of properties.
The agents and the property owners have duties towards each other that are
listed out in PSBA Act 2002. These are contractual agreements and each party
must agree to what is stated in the contract. A failure to fulfil duties as
agreed on the agency agreement is breach of contractual duties which can lead
to penalties. They have a duty towards tenants too.

·        
Property officer – is an assistant to a property
manager. The officer deals with the tenants and tradespeople on a day to day
basis

·        
Leasing officer – prepares and executes tenancy
agreements and manages payments of security deposits and bond at the
commencement of the lease

·        
Bookkeeper – manages the trust account
transactions and looks after the financial aspects of property management
department

·        
Receptionist – first point of contact when
someone enters/calls the agency. They must direct the inquires to relevant team
members. They are generally responsible for signing the keys in/out of the key
register.

 

 

 

 

b) Key agencies and industry bodies:

 

NSW Office of fair trading

To safeguard the rights of all consumers and advise the
business on ethical conduct and fair practice. This includes:

1.      
Licensing and registrations

2.      
Improving the delivery of real estate services

3.      
Promoting community awareness of real estate
services

4.      
Investigating complaints made my public and
resolve disputes

5.      
Continuing the development of the regulatory
framework

6.      
Administering the fair-trading act that affects
the conduct of real estate agents and practice in NSW

Civil and Administrative tribunal

It is a low cost, accessible and an independent
decision-making body which is like court that resolves the issues between
landlords and tenants or managing agent and tenants that cannot be solved by
the agent. It manages the complaints quickly and efficiently. 

Rental Bond Board

Agents are obliged to deposit all the rental bonds with
rental bond board which is administered by the office of fair trading. Rental
Bond board holds these bonds as security and are kept safely. No interest is
paid for the amount to tenants but is retained by OFT to fund state education
programs. The bond is refunded to the tenants once they move out in full amount
if no claims are made.

Real Estate Institute of NSW (REINSW)

It was established in 1910 to protect the interests of those
who are directly involved, represent and support the real estate industry. All
the members are bound by a code of conduct which administers the relationship
with their clients, customers and other members. Once the agency is a member,
all the employees automatically are bound by the code. It has 1500 members ad
offers various services including agency practice support, research and policy,
commercial benefits, education and training amongst others. The members can
join their numerous chapters and be a part of their regular meetings that
discuss important issues such as new legislation, complaints etc.

c) Legislative Requirements

Part 2:

d) Ethical and professional conduct standards

·        
The Property, Stock and Business Agents Act 2002,
Regulations and Rules of Conduct, Standard business practices and operating
procedures and Consumer Protection Legislation outlines the ethical conduct for
real estate agents. Its main objective was to encourage high standard of
professionalism and ethical standard of practice when dealing with clients,
consumers and other stakeholders. There are 19 core rules that apply to all
certificate and license holders. It includes:

·        
Rules 1-5: Fiduciary obligations arising as an
agent to ensure that the relationship between principal & agent and agent &
client is based on good faith, trust, loyalty, use reasonable skill and
diligence and an acceptable standard of behavior. It should be free from any
harassment and harsh or unconscionable conduct

·        
Rules 6-9: Agents must always deal in the best
interest of client and should be free from any conflict of interest. Agents
must comply by all contractual duties and obligations including duty to follow
instruction, act in the best interest of client, act in person, keep
confidentiality and respect the client’s monies. 

·        
Rules 10-13: Licensee must ensure that all
employees are compliant. Agents must not be of any transaction where there is a
conflict of interest. The agent cannot have any commercial relation with the
service provider for referrals. The service provider must be independent of the
agent. The agent must not recommend principal or any prospect engage the
services of a solicitor or licensed conveyancers if the agent knows that they
might be acting for the other party to the agreement concerned. Exception, when
no other solicitor is available. In such a scenario, the agent must disclose
the information to the principal and prospect that the solicitor or conveyancer
will be acting for the other party.

·        
Rules 14-19: Agents must not offer any gifts or
monetary or other benefit to any person to carry out the duties of an agent.
Agents must not be involved in false advertisements or representation about
acts or regulations. Agents must provide a copy of signed documents and must be
compliant always.

Failure to comply to the requirements can lead to a penalty
of up to $11,000.

e) Client Service Standards

Strategies:

f) Risk Management

Risk management is an essential part of the real estate
business. Risk is defined as an potential threat that have an impact on the
objectives of the business. It can be measured in terms of possibility and
consequences. All stakeholders of the agency will or have the potential to be
affected by the risk. No one is immune and thus everyone, collectively or
individually must take steps to mitigate the risks. Neglecting to assess,
manage and monitor risks may lead to breaches of relevant act, loss of revenue
and reputation, lawsuit, penalties and increased insurance premiums.

Risk management is a 
4-fold process:

a)      
Identification of risk – What are the potential
risks? This can be done by brainstorming, use of checklists, direct
observations, analyzing work structure, conducting surveys and hypothetical
situation analyses.

b)     
Risk Analysis – How will the risk affect the
business? How likely is the potential threat to happen and what can be severity
of it?

c)      
Control of risks – Can the risks be controlled
or mitigated? Can the chances of risk be reduced? Can the consequences be
controlled?

d)     
Monitoring risks – Re-evaluating existing risks
and building awareness of new potential risks.

Risks can be minimized and reduced if the agency is
compliant of all the acts and legislations that are laid out. The agency must
invest in continuous training programs and updating the team with new and
updated legislations. Another way to minimize risks is by having standard
policies, procedures and practices that reduces the chances of error.

No.

Type of risk

Minimizing risk

Monitoring

1.        

Unethical behavior

The principal or the person
in charge must be able to identify ethical behavior. Training to the team for
ethical behavior and professional conduct must be imparted. Brochures of the
rules of conduct must be easily available to each team member.

Periodic analysis
Feedback from clients and consumers
 

2.        

Failure of ensure that
documentations are accurately prepared

Having a set step-by-step
procedure to ensure that documents are prepare accurately. A checklist of all
the documents must be provided to the team members to ensure that all the
documents are attached and recorded correctly. A training session must be conducted
at regular intervals.

Internal audit to check if
documents are accurately prepared and recorded correctly.
Having a reporting hierarchy.
 
 
 
 
 
 

3.        

Inadequate key security

Understanding how is it
inadequate? Is the key cabinet not safe? Or there are some unauthorized
personnel who have access to the keys? If so, the keys should ne stored in a
fire proof cabinet and only those who are concerned must have access to it.
The new staff must not have an access until confidence and trust is gained.
Training the team about key management

Monitoring key register
 

 a)

Identify the various business ownership option and services
offered by real estate agencies:

Real estate agencies work with property – to either buy,
sell or manage. This comprises of residential (houses and apartments),
commercial (offices and hotels), rural (farms) and industrial (warehouses and
factories) properties. Different specialized agencies in real estate industry
provides an array of services including: Residential sales, commercial sales,
industrial sales, business sales, residential property management, project
management, commercial, industrial and retail management, strata management and
community management, stock and station agency, buyer’s agency, on-site
residential property management, holiday lettings and valuations.

Outline of typical organizational structure for a real estate agency

Figure 1:
Organizational Structure of a Typical Real Estate Agency

Overview of agency staff roles and responsibilities including admin, agents
and its representative and management. Legislative liabilities and
responsibilities:  

 

The Office of Fair Trading dictates the requirements and
eligibility by Property, Stock and Business Agents Regulations 2002 and 2003.

The agent who has
completed their certificate of registration can work as a real estate
salesperson, stock and station salesperson, business salesperson, property
manager, registered strata manager or registered community manager and a
registered on-site residential property manager. To complete the registration,
the person must be at least 16 years of age; fit and proper to hold a
certificate of registration (established by a police check); have a
qualification required for the class of certificate of registration concerned
and; should not be disqualified person.

 

The support staff in the
real estate agency may or may not require the registration certificate
depending the role they perform or whether they undertake the functions of a
real estate agent. Any staff member that is in contact with the client and
customers of the agency must be registered. The following are the main roles
and responsibilities of the property management team:

 

·        
Management – The aim of property management is
to attain the best tenant for the property and rent it at a fair price as quickly
as possible. The agent must meet the requirements of landlords as listed in
landlord’s instruction form. The principal is someone who client pays and get
into a written agreement for the use of the services provided by an agency.
This is the Management Agency Agreement. The principal must give the agent an
authority to act on their behalf. The agreement gives the principal and
therefore its agents the right to act and negotiate on behalf the client and
enter the client into a contract with third party. This means that agent can
find suitable tenants for the client and negotiate with them. The agent can
sign the lease on behalf of the client. The lease is the Tenancy Agreement. The
agent manages the property and tenancy as agreed upon the management agency
agreement.

·        
Principal – overlooks the property management
and sales department by giving agents an authority to act on his behalf. At all
times agents – both sales & property management and the principal has
fiduciary duties towards each other. At all times the agents will be loyal to
the principal and in return the principal will disclose all the relevant
information to the transaction and pay agent the commission or fee as agreed

·        
Property manager – is the main point of contact
for landlord and will be responsible for the operation of a portfolio of properties.
The agents and the property owners have duties towards each other that are
listed out in PSBA Act 2002. These are contractual agreements and each party
must agree to what is stated in the contract. A failure to fulfil duties as
agreed on the agency agreement is breach of contractual duties which can lead
to penalties. They have a duty towards tenants too.

·        
Property officer – is an assistant to a property
manager. The officer deals with the tenants and tradespeople on a day to day
basis

·        
Leasing officer – prepares and executes tenancy
agreements and manages payments of security deposits and bond at the
commencement of the lease

·        
Bookkeeper – manages the trust account
transactions and looks after the financial aspects of property management
department

·        
Receptionist – first point of contact when
someone enters/calls the agency. They must direct the inquires to relevant team
members. They are generally responsible for signing the keys in/out of the key
register.

 

 

 

 

b) Key agencies and industry bodies:

 

NSW Office of fair trading

To safeguard the rights of all consumers and advise the
business on ethical conduct and fair practice. This includes:

1.      
Licensing and registrations

2.      
Improving the delivery of real estate services

3.      
Promoting community awareness of real estate
services

4.      
Investigating complaints made my public and
resolve disputes

5.      
Continuing the development of the regulatory
framework

6.      
Administering the fair-trading act that affects
the conduct of real estate agents and practice in NSW

Civil and Administrative tribunal

It is a low cost, accessible and an independent
decision-making body which is like court that resolves the issues between
landlords and tenants or managing agent and tenants that cannot be solved by
the agent. It manages the complaints quickly and efficiently. 

Rental Bond Board

Agents are obliged to deposit all the rental bonds with
rental bond board which is administered by the office of fair trading. Rental
Bond board holds these bonds as security and are kept safely. No interest is
paid for the amount to tenants but is retained by OFT to fund state education
programs. The bond is refunded to the tenants once they move out in full amount
if no claims are made.

Real Estate Institute of NSW (REINSW)

It was established in 1910 to protect the interests of those
who are directly involved, represent and support the real estate industry. All
the members are bound by a code of conduct which administers the relationship
with their clients, customers and other members. Once the agency is a member,
all the employees automatically are bound by the code. It has 1500 members ad
offers various services including agency practice support, research and policy,
commercial benefits, education and training amongst others. The members can
join their numerous chapters and be a part of their regular meetings that
discuss important issues such as new legislation, complaints etc.

c) Legislative Requirements

Part 2:

d) Ethical and professional conduct standards

·        
The Property, Stock and Business Agents Act 2002,
Regulations and Rules of Conduct, Standard business practices and operating
procedures and Consumer Protection Legislation outlines the ethical conduct for
real estate agents. Its main objective was to encourage high standard of
professionalism and ethical standard of practice when dealing with clients,
consumers and other stakeholders. There are 19 core rules that apply to all
certificate and license holders. It includes:

·        
Rules 1-5: Fiduciary obligations arising as an
agent to ensure that the relationship between principal & agent and agent &
client is based on good faith, trust, loyalty, use reasonable skill and
diligence and an acceptable standard of behavior. It should be free from any
harassment and harsh or unconscionable conduct

·        
Rules 6-9: Agents must always deal in the best
interest of client and should be free from any conflict of interest. Agents
must comply by all contractual duties and obligations including duty to follow
instruction, act in the best interest of client, act in person, keep
confidentiality and respect the client’s monies. 

·        
Rules 10-13: Licensee must ensure that all
employees are compliant. Agents must not be of any transaction where there is a
conflict of interest. The agent cannot have any commercial relation with the
service provider for referrals. The service provider must be independent of the
agent. The agent must not recommend principal or any prospect engage the
services of a solicitor or licensed conveyancers if the agent knows that they
might be acting for the other party to the agreement concerned. Exception, when
no other solicitor is available. In such a scenario, the agent must disclose
the information to the principal and prospect that the solicitor or conveyancer
will be acting for the other party.

·        
Rules 14-19: Agents must not offer any gifts or
monetary or other benefit to any person to carry out the duties of an agent.
Agents must not be involved in false advertisements or representation about
acts or regulations. Agents must provide a copy of signed documents and must be
compliant always.

Failure to comply to the requirements can lead to a penalty
of up to $11,000.

e) Client Service Standards

Strategies:

f) Risk Management

Risk management is an essential part of the real estate
business. Risk is defined as an potential threat that have an impact on the
objectives of the business. It can be measured in terms of possibility and
consequences. All stakeholders of the agency will or have the potential to be
affected by the risk. No one is immune and thus everyone, collectively or
individually must take steps to mitigate the risks. Neglecting to assess,
manage and monitor risks may lead to breaches of relevant act, loss of revenue
and reputation, lawsuit, penalties and increased insurance premiums.

Risk management is a 
4-fold process:

a)      
Identification of risk – What are the potential
risks? This can be done by brainstorming, use of checklists, direct
observations, analyzing work structure, conducting surveys and hypothetical
situation analyses.

b)     
Risk Analysis – How will the risk affect the
business? How likely is the potential threat to happen and what can be severity
of it?

c)      
Control of risks – Can the risks be controlled
or mitigated? Can the chances of risk be reduced? Can the consequences be
controlled?

d)     
Monitoring risks – Re-evaluating existing risks
and building awareness of new potential risks.

Risks can be minimized and reduced if the agency is
compliant of all the acts and legislations that are laid out. The agency must
invest in continuous training programs and updating the team with new and
updated legislations. Another way to minimize risks is by having standard
policies, procedures and practices that reduces the chances of error.

No.

Type of risk

Minimizing risk

Monitoring

1.        

Unethical behavior

The principal or the person
in charge must be able to identify ethical behavior. Training to the team for
ethical behavior and professional conduct must be imparted. Brochures of the
rules of conduct must be easily available to each team member.

Periodic analysis
Feedback from clients and consumers
 

2.        

Failure of ensure that
documentations are accurately prepared

Having a set step-by-step
procedure to ensure that documents are prepare accurately. A checklist of all
the documents must be provided to the team members to ensure that all the
documents are attached and recorded correctly. A training session must be conducted
at regular intervals.

Internal audit to check if
documents are accurately prepared and recorded correctly.
Having a reporting hierarchy.
 
 
 
 
 
 

3.        

Inadequate key security

Understanding how is it
inadequate? Is the key cabinet not safe? Or there are some unauthorized
personnel who have access to the keys? If so, the keys should ne stored in a
fire proof cabinet and only those who are concerned must have access to it.
The new staff must not have an access until confidence and trust is gained.
Training the team about key management

Monitoring key register
 

 

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