Definitions - estate agents

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Estate agent

The role of an estate agent is to:

  • act on behalf of owners and residential rental providers to arrange the sale or lease of property including houses, buildings, factories, shops, farms, land and businesses
  • act on behalf of buyers when engaged as a buyers agent or advocate to negotiate the purchase of property
  • provide market appraisals of properties and businesses for clients
  • negotiate the sale or lease of properties and businesses
  • collect rents and manage rental properties.

To do any of these you must:

  • hold an estate agent’s licence, or
  • be employed by a licensed estate agent as an agent’s representative.

Officer in effective control

The officer in effective control (OIEC) is the principal agent in control of the estate agency business of a corporation.

The principal agent and the officer in effective control of a corporation must:

  • regularly and substantially attend and be in charge at the principal office
  • control and supervise the agency business, including any branch offices
  • establish procedures to ensure the agency’s ongoing compliance with the law and good agency practice, and monitor the agency to ensure these procedures are followed
  • take reasonable steps to ensure that estate agents, agents’ representatives and other employees comply with the law.

Principal agent

The principal agent is the agent in control of an estate agency business including sole trading enterprise, partnership or corporation. In the case of a corporation, the principal agent is called the officer in effective control.

Agent’s representative

An agent’s representative is employed by or acts for a licensed estate agent, and with written authority can perform any of the legal functions of that estate agent. For example, an agent’s representative can act as a salesperson or property manager, but cannot operate an estate agency business.

Agency authority

An agency authority is a binding agreement between a client (usually a seller or residential rental provider) and estate agency, for the sale, lease or management of real estate. Among other matters, it details the agreed commission, marketing expenses and outgoings.  

An agency authority must include the information and statements required by the Estate Agents Act 1980, and be signed by the client and the estate agent (or the agent’s representative on behalf of the agency).

An authority can be either an exclusive, general or auction authority. 

For information on the agency authority to sell, view Selling property with or without an agent

For information on the agency authority for the lease of real estate, view Property management.

Trust account

A trust account is a special purpose account where trust money received by an estate agent or an agent’s representative is held until settlement, or until it can be released to the person entitled to that money. Trust money is money held by an agent on behalf of another person and includes sales deposits, rent, or fees for advertising and maintenance paid in advance.

For more information, view What is a trust account?.