Wednesday, October 8, 2014

Agents and their commitments

Now seems as good a time as any to remind tenants that the real estate agent you deal with may not be the person you think they are.


Talking with tenants, we find many who think of the agent either as 'their' agent, or as an impartial intermediary between themselves and the landlord.

But neither is true. The agent is always your landlord's agent. The agent may be helpful to you, kind, with a GSOH... but always remember, they act for the landlord, and look out for your landlord's interests – not for you or yours. The agent promises faithful service to the landlord – in return for money, paid by the landlord.

Where a person, for reward, carries on business as an agent for a real estate transaction, rent collection, or other property management services, they are required to be licensed under the Property Stock and Business Agents Act 2002 (NSW) (section 8). That Act imposes numerous obligations on agents, including rules of conduct in relation to anyone with whom the agent deals: for example, an agent must act 'honestly, fairly and professionally with all parties in a transaction' and  'not mislead or deceive any parties' (PSBA Reg 2014, Schedule 1, clause 3(a) and (b)). They must also 'not engage in high pressure tactics, harassment or harsh or unconscionable conduct' (Schedule 1, clause 5). They must also not ask a person to sign a document unless all material particulars have been inserted (Schedule 1, clause 16) and must provide a copy of the document to the person who signed (Schedule 1, clause 17).

But those rules also make clear that the agent must act in the client's best interests and in accordance with the client's instructions, except where doing so would be unlawful (Schedule 1, clauses 6 and 9). And in the case of a tenancy, the agent's client is always the landlord. 

There are also rules of conduct that relate specifically to rental property management. An agent must accompany a prospective tenant on any inspection of a property, and must not give the keys to the prospective tenant even for a short time (Schedule 2, clause 11). They must promptly respond to and 'subject to the instructions of the owner, attend to' your requests for repairs (Schedule 2, clause 13(a)) – and if the landlord's refusal to do a repair would be a breach of your agreement, the agent has to tell them so (clause 13(b)). And if you are in breach of the tenancy agreement, the agent must immediately tell the landlord (Schedule 2, clause 14). If the agent becomes aware that the property is for sale, they must immediately notify you in writing (Schedule 2, clause 15). Finally, the agent must not ask you to sign a claim form for the bond before the end of your tenancy, unless all the bond is being paid to you (Schedule 2, clause 17), and when your tenancy does end, they must take all reasonable steps to ensure that the final inspection is done in your presence.

All these things are useful to know, and if you ever need to you can remind the agent of their obligations under the PSBA Act. And if the agent breaches these obligations, you could make a complaint to NSW Fair Trading about it. But that's not going to get you a remedy. In most cases, you would be better off considering whether the agent's misconduct is a breach of the tenancy agreement between you and the landlord, and dealing with it that way. After all, because the agent is your landlord's agent, your landlord is ultimately responsible for the things the agent does, and doesn't do, on their behalf.

So, for example, if the agent is not responding to your emails about a repair that needs doing, don't worry too much about whether it is a breach of the agent's obligation under Schedule 2, clause 13(a) of the PSBA Reg – treat it as a breach of your landlord's obligation under your tenancy agreement to provide and maintain the premises in a reasonable state of repair, and proceed accordingly.


And if, on the other hand, the agent gives you advice on how to deal with a tenancy issue, or promises to do something for you, that's all well and good, but keep your wits about you, and don't rely on what the agent says. Speak with a TAAS instead – they look out for tenants' interests.

3 comments:

  1. Excellent post

    Thanks

    ReplyDelete
  2. Very well put, have heard a number of epople who are tenants say but the real estate was nice and agreed with me.

    ReplyDelete
  3. Great post and article. Also I lived on a busy inner west street with high traffic and plenty of shops with apartments above the shops. These were not listed as residential by council but as commercial, even though people such as myself had a residential lease. Development was going on all of the time around us with no consideration to the residences living above the shops and other premises. Getting access to garbage bins, recycling and other such things was a nightmare.

    Also I wonder what "reasonable" means.

    In my last place the apartment above leaked regularly, into one of the bedrooms. Getting the landlord to fix it in any reasonable time frame, and to any reasonable quality was very problematic. Part of that reason was that some of the quotes that the agent got were too expensive. They suggested the whole plumbing/ ceiling needed redoing. Landlord wasn't going to pay for that. So instead they kept resealing the upstairs shower/ bathroom as this was considered the site of the leakage. This went on for many many months. Everytime the tenants upstairs showered, a bucket was needed to be placed at the end of the bed where a stream of water leaked down. A plumber came to visit and cut a large square out of the plaster in the ceiling, took a recycling tub and screwed it upside down to the ceiling with a garden hose attached trailing out of the bedroom window. It was left like that for weeks. Eventually someone came back and removed it and placed a fake man hole cover over the square hole, but water stains on it revealed that the leak was continuing. Another plumber accessed the apartment above to check the sealing in the bathroom and then removed the fake man hole cover and placed some paper inside the ceiling to see if any water leaked onto that. It was left this way for years and the agents told us that the landlord was not obliged to fix this. We also had no outside light and access to our premises was only via going down the lane and behind the back of a shop and up some stairs to courtyard and front door. So an outside light over the door would provided much needed light and some security. We attached a spotlight inside pointing out onto the courtyard rear lane access, but in Winter the heat from the lamp cracked the glass. We were told we had pay for that. We had heavy stains on the walls that looked like mould, but the agent said they weren't. They were damp but mould hadn't developed. Nothing was done about it. We kept the premises in tip top shape. We did receive all of our bond back, but were never sure what the landlords responsibility was in our situation.

    ReplyDelete

Please keep your comments PC - that is, polite and civilised. Comments may be removed at the discretion of the blog administrator; no correspondence will be entered into. Comments that are abusive of individual persons, or are sexist, racist or otherwise offensive will be removed, so don’t bother leaving them.